Until recently, falling revenue has not been the prime cause of these serial national deficits. In fact, the Treasury took in an all-time high of nearly $2.6 trillion in 2007. Unfortunately, wild spending has skyrocketed well above the pace of both inflation and annual revenue increases. Such profligacy ensures that even with a growing economy, increased tax revenues never match out-of-control spending.
If the president wishes to raise revenue, he might first close loopholes. That would ensure that those who owe taxes actually pay them. He could start with his own Cabinet. Treasury Secretary Timothy Geithner, who oversees the IRS, at one point did not pay his Social Security and Medicare taxes and took improper writes-offs. Attorney General Eric Holder, the nation's top law-enforcement official, did not pay long-overdue property taxes on a house he co-owned until recently chided to do so by the media. The husband of Labor Secretary Hilda Solis had overdue tax liens on property that went back 16 years. Cabinet nominee Tom Daschle withdrew from consideration due to past unpaid taxes.
So before raising taxes, the president might first urge the super-rich to pay their taxes at the income tax, rather than capital gains, rate. Next, he could remind his own Cabinet officers to pay all the taxes they owe. Then, he should offer to pay more of the first family's costs when they jet to luxury spots like Martha's Vineyard, Costa del Sol or Vail. And finally, he might ask the nearly 50 percent of Americans who now pay no income tax to pay at least 5 percent of their income in federal taxes -- to ensure that they see their government as a taker as well as a giver.
Do all that and we would have more money -- and the president would be less likely to declare, "I don't need another tax cut."