Bryan talks about good taxes
Federal tax cuts may sound good in the short-term but, because they’re based on projections, could hurt in the long run.
That was the main topic of Sen. Richard Bryan, D-Nevada, address Monday to the Tahoe-Douglas Chamber of Commerce State of the Basin luncheon.
The current “economic performance is matchless,” Bryan told the business group. “(Five years ago, the deficit’s) sea of red ink was expected to run into the end of time.”
Now analysts are predicting a surplus of $996 billion in 10 years, not including social security dollars that are often added on to make it look like a $1.9 trillion surplus.
Plans to spend it, including the Republican tax cut proposal are premature, he said.
“There’s nobody on the face of the planet who knows what the economy is going to be like the next 10 years,” he said.
The surplus is based on three assumptions, he said. The economy continues to surge. All surplus goes to pay down the debt. And Congress will abide by its self-imposed spending caps.
If the tax cuts are imposed and the projected surplus does not happen, it could leave Congress with no choice but to cut back spending.
Besides hits to Social Security and Medicare, the dollars promised Lake Tahoe during the 1997 Presidential Summit on Lake Tahoe, may also get lost in the melee.
“All the issues come down to one point, the economy,” said chamber President Pat Atherton, following Bryan’s address. “I think Tahoe’s concerned as we watch what happens at the federal level where the surplus goes.
“If projections fall short, would the $300 million (in federal funding for Lake Tahoe environmental projects) come through or be one of the areas that’s hit with cutbacks?”
Whether federal analysts or chamber members, it all boils down to projections.
“We’re looking in our crystal ball at projected figures. If it materializes, it solves everybody’s problems. If it doesn’t, everyone fails,” Atherton said.
Bryan warned that, if Republicans choose to make a tax cut a major campaign issue, they would be unlikely to compromise. Some Democrats might also benefit by capitalizing on the impasse itself as a campaign issue.
“Gridlock can save us from ourselves,” Bryan said. “If (the tax cut) goes nowhere, it all goes to debt reduction. “If we put every dollar on the debt, I feel I can give a gift to (my grandchildren).”
Bryan touched on several points of more direct concern to Tahoe businesses during the meeting.
– Addressing concerns that the Feinstein bill to redesignate the Lake Tahoe Basin as the Lake Tahoe National Scenic Forest and Recreation Area only consolidates three designations into one administrative unit. Obtaining the $300 million in environmental improvement projects should be easier to deliver, he said.
– Bryan would also like to see some Bureau of Land Management property in Las Vegas that now falls under the special Santini-Burton environmental designation be sold and the dollars sent to Lake Tahoe.
– Bryan supports efforts to limit Internet gambling.
“It doesn’t make sense to turn every family room into a gambling parlor,” he said, noting there’s no way to impose an age limit on who can access gambling Web sites.
– Regarding the expected Y2K computer problems, Bryan said that Congress took a positive step in reducing the limitations on litigation, including a ceiling on damages and time given to companies to correct problems before litigation.
– Efforts are under way to update “hopelessly outdated” financial regulations created in the depression era.
“Everyone agrees it’s outdated but not everyone agrees on how to (update it).”
– Conferees now hammering trying to merge Senate and House bills that restrict the ability of financial institutions to sell private information to a third party, including telemarketers, without the consent or knowledge of the subject.
Some financial associations prohibit members from such sales but there is no legal protection, he said.
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