Obama's stimulus plan spells bad news for taxpayers

By now, most Americans are familiar with the debate regarding the economic stimulus plan championed by President Obama. It now appears that a stimulus package supported by the president and his Democratic allies will soon be approved by both houses of Congress and signed into law by the president, according to CNN.

President Obama and his supporters argue that this stimulus package will give the ailing economy a much needed shot in the arm. They argue that when money is being spent, the economy is better off and job growth will soon resume.

The Republicans have united against this package. According to The Washington Times, the GOP contends that this plan will be slow to achieve results on the economic front and that tax cuts need to play a bigger role in any recovery plan.

Both parties raise excellent points in their reasons for being supportive or critical of the stimulus proposal. However, I believe that there are other important questions yet to be asked: Mr. President, since, in your inaugural address, you called for the government "to spend wisely" and "reform bad habits" with regard to the people's money, how do you plan to spend so much money without worsening the national debt? And if you decided to raise taxes to pay for this plan, wouldn't the tax increases lessen the impact of the stimulus?

As many Americans know, the federal government's budget deficit has hit a record high in recent years. One factor contributing to this astronomical debt was President George W. Bush's unwillingness to veto many spending bills during his eight-year tenure. Now, reports CNN, President Obama and the Democrats have unveiled a $789 billion economic stimulus plan, including highlights such as $90 billion of increased Medicaid match to states and $150 billion for infrastructure improvements.

These are wonderful reasons to spend government money. All Americans would like to see better bridges and roads and lower-income citizens receiving help for health-related expenses. However, as the president himself has acknowledged, responsible budgeting must be a priority. If the government is going to spend $789 billion, an already record federal deficit will only balloon even more. If such a plan is to become reality, the only way that it can be enacted without worsening the deficit would be to institute massive tax increases. However, higher taxes would only place another burden on an already struggling citizenry.

When taxes go up, the government has more money and thus finds itself in better fiscal shape. However, this money is coming from the people, the very sources of economic growth. If individuals have less money, they are less able to invest and spend, which will further weaken the economy. If businesses are overtaxed, they will be unable to hire additional workers and may have to jettison others.

There will also be less money for innovation and implementing new technology. If employers want to look into buying better healthcare plans for their employees, they will be less likely to do so because they will have less money to spend on it.

Some, including President Obama himself, have suggested increasing taxes only on people who are traditionally considered wealthy. They argue that since these people have so much money, they should contribute to their government more than anyone else simply because they can afford to. Yet, this is probably not a wise course to pursue either, for no reason other than that it sends a message to younger people that more success will equal fewer rewards. Since there are such significant costs to this stimulus package, is it really worth enacting?

So what should be done on economic and fiscal issues? President Obama should dedicate himself (as President Bush should have done) to emulating the approach of the late Connecticut Gov. Thomas Meskill.

In the early 1970s, Meskill vetoed hundreds of spending bills on his way to turning a $260 million deficit into a $65 million surplus, according to Eyewitness News. At the same time, the president should dedicate himself to cutting as many taxes as possible. He should first concentrate on reducing taxes on businesses of all sizes. With how sorely needed jobs are, this will increase hiring opportunities.

He should also work toward reducing taxes on individuals of all incomes to allow people to keep more of their hard-earned money to spend and invest to further improve the economy. Doesn't this make more sense than a costly stimulus plan that may make tax increases inevitable?