A Modest Proposal

No, this is not a modest proposal like Jonathan Swift's, who suggested that poor Irish people could sell their babies to the English, who would eat them. This is truly a modest proposal to help the working people of America, and lo and behold, it fits right in with the GOP mania for tax cuts.

Prior to 1981, that is before the "Reagan Revolution," people who itemized their tax deductions could write off interest paid on personal debt - that is interest paid on car loans, credit card debt and so forth. Since so many people of modest means were already itemizing to use the deduction for interest paid on a mortgage, quite a few people were using this deduction.

Trying to encourage thrift instead of consumption, President Reagan and the Congress we all know and love removed the deduction, and created exemptions for thrift savings accounts. What this did of course was to shift the tax burden downward onto the shoulders of the people who could least afford to pay more tax.

So, my proposal is simply to restore the deduction for interest paid on personal debt. Doing so would put more money into the hands of the people who are most likely to spend any additional money they have, increasing personal consumption, reducing inventories of unsold goods, and getting the old economy humming again. And, using the Republicans' own logic which seems akin to "the more you spend the more you save," tax revenues would actually go up!

What could be wrong with that?

You say it will encourage even more indebtedness? I say, shouldn't people be able to decide for themselves how far they go into debt? Don't they already cringe at the necessity of piling up debt? How could the current indebtedness plight of ordinary working people possibly be worse?

Isn't it worth a try?