Austin, Texas--

The justification for enormous cuts in social spending, including Medicare, is "We must balance the budget, we must balance the budget." The old, the young, women, the poor, veterans, the environment, education -- all must be sacrificed so we can balance the budget.

As Gib Lewis used to say: "Whoa! Back up, members."

We're so busy counting up the losers under the Republican budget that nobody is looking at the winners. There are two sides to the ledger. True, one way to balance the budget is by cutting spending. Another way to balance the budget is by NOT cutting taxes, especially by not cutting taxes for the wealthiest Americans and corporations.

Let's just take a look at the numbers with the help of Citizen Action, which reports that the Republicans propose:

--Repeal of the corporate alternative minimum tax at a cost of $22.1 billion over seven years.

--Increased corporate write-offs and deductions, at a cost of $47.8 billion over seven years. (Corporate profits are now at their highest level in 45 years.)

--Capital-gains tax breaks, indexed to inflation, at a cost of $78.6 billion over seven years.

Total: $148.5 billion.

Now add to that billions in proposed tax cuts for families, again disproportionately benefiting the wealthy, for a total of $245 billion in tax breaks under the Republican bill. According to the Treasury Department, 52 percent of the proposed Republican tax breaks will go to families making more than $100,000 a year and another 31.6 percent to families making from $50,000 to $100,000. Less than 5 percent of the tax breaks will go to those making under $30,000; that's 40 percent of American families.

That's a direct redistribution of income by the government.

You can also add the additional defense spending -- $58 billion more over seven years than the Pentagon even asked for, much of it pure Republican pork.

Now look at your budget.

Yes, Virginia, we are making deep cuts in many essential programs -- not to balance the budget but to pay for tax cuts for wealthy individuals and corporations. This is dumb.

Let's assume that balancing the budget is an important national goal. (Actually, many economists say the national debt should be considered as a proportion of the gross domestic product, and that ours is well within whatever ballpark they use for these things. Personally, whenever I contemplate the national debt, I feel like retiring to bed with an ice pack on my head.) And let's acknowledge that even the mildest recession in the next seven years (or in the case of the Clinton proposal, 10 years) would knock all projections into a cocked cowboy hat. And the Federal Reserve is doing its dead-level best to bring on a recession. Even leaving aside the fact that we are discussing an illusory goal here, we need to look long and hard at what balancing the budget in this backassward fashion is going to do to our country.

The poor in this country have gotten poorer, the rich have gotten much richer, and the middle class is shrinking. Social mobility is disappearing. Income disparity -- the gap between the rich and everybody else -- is enormous and getting worse. The cost of this phenomenon comes in what sociologists call "social cohesion," which is a fancy term for what keeps the country from falling apart.

This is a 20-year trend; it holds constant through all kinds of studies by all kinds of organizations using all kinds of paradigms. The decline of the middle class -- those with after-tax incomes between $24,000 and $72,000 -- was shown most recently in a study by Greg Duncan of Northwestern University and Timothy Smedling of Syracuse University, using the financial surveys of 5,000 households conducted every year since the late 1960s by the University of Michigan.

Duncan told The New York Times: "What's striking is how uniform this fall in upward mobility has been across all demographic groups in the labor market." But while it may be affecting all groups, it is actually affecting young people disproportionately. "Young men's chances of attaining a middle-class income by age 30 is dwindling. While 60 percent of those turning 30 before 1989 managed to do so, only 42 percent have succeeded since then," according to the Times story. That's a damn dramatic drop. Education, race, parents' income -- nothing else mattered.

This is the terrible irony of the new political orthodoxy: We keep saying we have to balance the budget so we won't pass this dreadful debt on to our children, but what we are doing is destroying our children's ability to get anywhere. Barry Bosworth of the Brookings Institution is also quoted in the Times: "To the extent that the widening of distribution of income has occurred, it really is true among younger people rather than older, and younger people have borne the brunt of the changes."

In the 1960s, those with only a high school education could still get well-paying jobs. Not today. Either higher education or technological skills are needed. So the Republicans are cutting student loans and job-training programs. We're sacrificing young people so the rich can get even richer.


Heads up, team; sneak play ahead. The deliriously misnamed Coalition to Save Medicare is about to join the national debate about health insurance programs for seniors. What we have here, hiding behind those Foster Grants, is a coalition of huge corporations and insurance companies out to loot Medicare to pay for corporate tax breaks.

If the Coalition to Save Medicare is interested in saving Medicare, then we have gone Through the Looking-Glass. As the Red Queen said to Alice, "Why, sometimes I've believed as many as six impossible things before breakfast."

Citizen Action, a consumer watchdog group, looked into the membership of this wondrous coalition and found therein not only the usual suspects -- the National Association of Manufacturers and the U.S. Chamber of Commerce, both of which opposed Medicare from the beginning -- but some nifty double disguises as well. Take the Alliance for Managed Care, which turns out to be the "nom de lobby" for Aetna, CIGNA, Prudential and MetraHealth.

Also listed as a member of the Coalition to Save is the Healthcare Leadership Council, which sounds like something that Hillary Rodham Clinton would join but happens to be the largest hospital corporations, insurance companies and pharmaceutical companies. The Council for Affordable Health Insurance is a collection of smaller fry, about two dozen medium-sized insurance companies, according to Citizen Action. And you know how concerned the insurance companies are that we all have affordable health care.

All these corporations are in line to get the corporate tax breaks that Republicans are supporting and planning to pay for by cutting Medicare. Ah, but surely the Seniors Coalition -- whose chief lobbyist, Jake Hansen, is co-chair of the Coalition to Save Medicare -- would not support a raid on Medicare just to pay for a tax break for corporations. Would it?

According to Citizen Action, the New York attorney general investigated the Seniors Coalition along with other organizations in a network involved in "a pattern of fraud and abuse" (quoting the New York Times). According to PR Newswire, "The organization was fined by the Pennsylvania State Attorney General and forced to contribute $9,000 to a legitimate seniors' charity organization, the Pennsylvania Alzheimer's Association." According to the Washington Post, "The Seniors Coalition is barred from soliciting in the state of Maryland for failing to disclose financial data as required by law."

This is the group that House Speaker Newt Gingrich chose to meet with on April 28 to make a major policy speech on Medicare reform, bypassing the American Association of Retired Persons (33 million members) and the National Coalition of Senior Citizens (5 million members.) The Seniors Coalition says it has 1 million members.

According to an article in the National Journal, the Seniors Coalition is one of three "seniors" groups -- the others are the 60/Plus Association and the United Seniors Association -- started with help from Richard Viguerie, the right-wing direct-mail king. Viguerie is notorious for trying to scare senior citizens into parting with their money.

United Seniors reported spending nearly $2.2 million on fund-raising and $113,000 on lobbying in 1993. According to Associated Press reporter Jim Drinkard, the three groups mail out millions of solicitations to seniors attacking the AARP as liberal, and together, they raise about $18 million a year. USA sent out a letter earlier this year saying Congress was about to make "BILLION-dollar cuts in Medicare funding" and that donations were needed to pay for "intensive work by our team of lobbyists and legislative specialists."

Drinkard found that many of the members of Congress who control issues critical to seniors had never heard of these three groups. None had ever been invited to testify before Congress until the Republicans took over this year. The Journal noted, "The groups, in turn, can use the GOP to establish their legitimacy."

The Seniors Coalition grew out of the Taxpayers Education Lobby, a conservative direct-mail group started by Dan C. Alexander, a former school board president from Mobile, Ala. This group supposedly supported school prayer and traditional values, but Alexander was convicted of extorting kickbacks on school construction projects. While he served a four-year term, his wife, Faye, started the Seniors Coalition with Viguerie's help. For several years, the Coalition's president was the Alexanders' teen-age daughter.

So here these groups are, scaring seniors into giving money to save Medicare, while they support Republican efforts to take $270 billion out of Medicare.

Another one of the member organizations of the Coalition to Save is Citizens for a Sound Economy, which opposes government financing of health care. In January 1993, one of its publications stated: "Reform entails phasing out Medicare for those young enough to invest privately and to accumulate enough funds to provide for their own medical care upon retirement. The only viable long-term solution to the Medicare crisis lies in encouraging all Americans to save for their future health care needs."

And good luck to you in that endeavor. A friend of mine spent three days in the hospital earlier this summer with what turned out to be a bad stomach ache (she was advised not to eat peanuts anymore) and just got a bill for $15,000.

Molly Ivins is a columnist for the Fort Worth Star-Telegram.



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Copyright 1995 The Progressive Populist. -- Revised October 29, 1995 --