Tax Credit Rhetoric
The figures bandied about regarding the percentage of tax cuts in the stimulus package was false. Only a very small portion of the bill represented real tax cuts – the rest was spending implemented by having it paid through the tax system. This same type of deceit put Enron executives behind bars. Yet, because it is Uncle Sam and not Kenneth Lay, we let our guard down—and our sensibilities.
Tax cuts and tax credits are terms often used interchangeably. Most Americans don’t know the difference and Congress was counting on that. The stimulus package was sold as “tax credit this” and “tax cut that”. We eventually tuned out: they sound alike, ergo they must be alike. But that is simply not true.
Tax credits peppered the stimulus package. Whether it was a “credit” for energy saving devices, college tuition, alternative energy, gasoline efficiency, or even for being over a certain age; all are simply government expenditures being run through the tax system, But its your money collected and then given back to certain people who meet the criteria—or dare we say, agenda.
For example, if the law provides that by purchasing a $5,000 energy saving device you can reduce your taxes by $1,000, this has nothing whatever to do with a tax cut. If you have to do something to get something, you must look at what is really going on. In this case, the manufacturer and seller of the device is being paid a $1,000 subsidy by Congress to help it sell its product. The payment is being made by having the IRS write the check.
We’re in a recession now. Tax cuts have helped end recessions in the past. The same cannot be said for tax credits. Government is simply laundering its expenses by running it through the tax code. Stimulus spending will do nothing to fix the economy and everything to make the government and its deficit bigger. With politicians and the media using confusing rhetoric, many Americans bought into The Big Lie.