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October 30, 1985 - Image 4

Resource type:
The Michigan Daily, 1985-10-30

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Wednesday, October30, 1985

Page 4

The Michigan Daily

0, S ridw 1ai1y
Edited and managed by students at The University of Michigan

Complexities of tax reform

Vol. XCVI, No. 40

420 Maynard St.
Ann Arbor, MI 48109

Editorials represent a majority opinion of the Daily's Editorial Board

Disarming ideal

THE PROPOSED handgun ban
ordinance presented at a
special session of the City Council
is reason to rejoice.
Members of Citizens for Han-
dgun Control, a local organization,
have taken the initiative to press
for the implementation of a most
urgently needed piece of respon-
sible legislation; one that might
end the unnecessary bloodbath
created by handgun violence.
-The proposed legislation is
modeled on the law currently in ef-
fect is the village of Morton Grove,.
Illinois: in short, the law would ban
the possession and sale of han-
uns within Ann Arbor city limits.
eace officers, military personell
on duty, corrections officers, and
certain private security agents
would be exempted from the ban,
as would antique guns and han-
dguns rendered permanently
inoperable. The law would not call
for the confiscation of handguns
pity residents already own, or be
applicable to "long guns" - those
for sporting purposes.
Handguns have no purpose other
than to kill people. Handguns
provide a pleasant illusion of
security. The fact is however, that
posession of a handgun is actually a
dangerous thing. A loaded gun is
six times more likely to cause an
accidental death than to kill a rob-
ber or burglar. If a victim of a rob-
bery or burglary has a gun, it is
eight times more probable that the
victim will be hurt than if he or she
has no gun.
In 1983, 9,014 people were mur-
dered with a handgun in America,

and 57 percent of those murders
were committed by relatives or
persons acquainted with the vic-
tim. And perhaps most tragically,
approximately one-fourth of the
3,000 accidental deaths by handgun
each year in the U.S. are if children
under the age of fourteen. It seems
hard to justify such senseless
massacre with the relaxed federal
gun laws that do exist.
What weak legislation there is to
protect the populace from the
menace of handguns is embodied in
the 1968 Gun Control Act, a law
passed largely in response to the
assassinations of Sen. Robert F.
Kennedy and civil rights leader
Martin Luther King, Jr.
That law, however, is currently
being challenged in Congress by
senators and congressmen with
heavy financial backing from the
National Rifle Association. The
bill, known as the McClure Gun
"Decontrol" bill passed the Senate
July 9 by a vote of 79-15. If it passes
the lower House, legislation
restricting interstate handgun
sales would be eliminated, effec-
tively repealing whatever
measures there are to restrict han-
dgun sales.
After a six-year battle to block
the passage of the McClure bill,
advocates of gun control will con-
tinue to lobby for the retention and
strengthening of federal gun con-
trol laws. But the implementation
of local ordinances to ban han-
dguns is now perhaps the most ef-
fective way to act responsibly to
stop so many unnecessary mur-

By David J. Kaufman
Important interest groups have lined up
for and against specific provisions of
President Ronald Reagan's tax reform
proposal. However, the struggle is not just
between these groups, but between the
White House and Congress and between the
Democratic-controlled House of Represen-
tatives and the Republican-led Senate. It
has forced some unique coalitions between
members of Congress. This short piece will
explain some of the problems posed by the
Rep. Daniel Rostenkowski, chairman of
the House Ways and Means Committee, will
indeed send a bill out of his committee and
see that the whole House has a chance to
vote on it. His political life depends on how
effectively he is able to gauge the different
opinions of the members of his committee
and the larger body and come up with a
cohesive package that will be passed
without significant delay.
There are several reasons for this urgen-
cy. Rostenkowski wants Speaker Thomas P.
O'Neil's job when he retires in 1986. His
ability to form a coalition and mobilize sup-
port for this legislation is a significant test
of his leadership. Additionally, the Reagan
Administration has taken the initiative and
has forced the Democrats into proving that
they are not the "tax and spend" party, a
label which has all too often been accurate.
If the House Democratic leadership in-
cluding Rostenkowski fail, the President
and other Republicans will be able to
claim that the Democrats torpedoed tax
reform. This will do little to dispel the im-
pression that the party is fiscally irrespon-
sible. With general support for the
Democrats waning, the future of their party
depends in part on this issue.
The package that Rostenkowski's Ways
and Means Committee sends out will be
significantly different from the one that
Reagan presented at the end of May. A
summer of hearings has sensitized the
committee as to what some of their vocal
(and powerful) constituents desire.
The committee is stacked with
Democrats - 23 of 36 or 64 percent are
Kaufman is a graduate student in the
Institute of Public Policy.

members of that party - while in the House
Democrats represent only 58
percent. The point is that their bill will be a
Democratic one, which will balance such
diverse views as Donald Pease and Byron
Dorgan's relatively anti-business stances
against more moderate members like Cecil
First and foremost in the Democratic
members' minds is the issue of fairness to
families and to the middle class. They wish
to make the proposal more generous to
those in the middle, rather than to those in
the upper income groups. However, they
fail to realize that the reason why the higher
groups are receiving a larger tax cut is
because they pay at a higher rate and in-
dividually pay more.
In fact, many are taxed at the rate of 50
percent, or for each dollar earned, 50 cents
is paid in taxes. Is it not fair that those who
pay at the highest rate get the largest per-
centage decrease?
Additionally, they fail to realize that the
bulk of revenue is generated from the mid-
dle class. If one gives a larger cut to many
individuals, it will be more expensive and
have greater negative consequences for the
deficit. A relatively larger cut to those in the
higher brackets would cost less and in many
instances, increase government revenues
because of the removal of the disincentive
effects of high marginal tax rates.
Because just about everyone involved in
the process agrees that the proposal must
remain revenue neutral (whatever that
means), money for the more generous tax
cuts to the broader base of people must
come from somewhere. But before that can
be discussed the fallacy of revenue
neutrality must be uncovered.
"Revenue neutral" assumes that in-
dividuals and businesses do- not change
their behavior relative to tax code changes.
Everyone knows that this is incorrect. In
fact many believe that the reason why the
United States has a tax code is to influence
decisions of consumers, workers and
business people. Individuals and cor-
porations do take tax considerations into
account in making decisions.
In addition, such "fairness to families"
provisions as two-earned deduction and.
child care credits will be reinstated. The
cost of these will be made up from tax in-
creases in the most politically easy places.
Corporate taxes and the way in which a
company recovers the cost of an investment

are two "hidden" places in the eyes of
Congress, and the public are prime areas to
pick up more revenue. However hidden they
appear, the ramifications involved are
It is well known that businesses are often
able to pass on all or some of their tax bur-
den to their consumers as a cost of doing
business. Wages could even decrease
because of their increased costs. Business,
more specifically small business, is the
most active place for job creation in this
country and will suffer from , increased
taxes. Investment in plant and equipment is
an important determinant of the growth of
income and productivity in any economy.
If businesses are unable to recoup their
investment as quickly as they have been
able to in the past, serious slowdowns in in-
vestment and hence growth are destined for
our economy. The effects of such provisions
will be to slow growth in or even decrease
the standard of living for all Americans.
Further, a fourth rate for higher individual
incomes and a stronger individual
minimum tax will probably be parts of
Rostenkowski's package and will reduce the
incentive effects of reduced tax rates.
The non-deductibility of state and local
taxes. is the largest dollar item and most
controversial of the provisions in the
Reagan tax plan. Surely a compromise will
result in the Ways and Means Committee
with the deductibility for property taxes
only the most likely outcome. Large amoun-
ts of money will be needed because of this
compromise, however, this may make the
proposal politically pallitable enough to the
high-tax state legislators, most notable
those in New York. Additionally, because
the personal exception is a more lucrative
advantage for those in the higher brackets,
it will be changed to a credit instead.
Overall it appears as if the tax burden will
be significantly shifted from the middle and
lower income individuals to those with
higher income and the business sector of the
economy. Only influential business lobbies
can prevent this from occurring or at least
decreasing the level of diversion.
Rostenkowski will broker enough votes to
enable the bill to clear the House by the end
of the year. The Senate has promised to
work on it in 1986. Reagan will have a chan-
ce to sign a bill before the midterm elec-
tions, but the question remains as to
whether it will be meaningful, or merely a
reshuffling of interests.


' .




-MOE -~ rK ~ ONES MO


Constitutional intent


Activists at the height offashion

ATTORNEY General Edwin
Meese sparked the latest con-
troversy over the United States
Constitution in July when he called
upon the Supreme Court to return
tO "a jurisprudence of Original In-
tention. "
Subsequent clarification from
Meese's staff seem to indicate that
Meese would have the Court inter-
pret theConstitution in the precise
ianner in which the Constitutional
flamers had intended it to be writ-
Beyond the impossibility of
knowing what went through the
minds of the founding fathers,
Meese's request is disturbing in its
sheer inappropriateness.
The men who wrote the Con-
stitution were, for the most part,
adept politicians who sought to
create a national government that
would preserve the rights of
private citizens to maintain
property. They were responding to
the urgent need for a unified
mechanism of response against
foreign governments and a system
for arbitrating grievances between
state governments.
:The situations the framers were
c6ncerned with have either been
resolved or greatly altered. Many
of the pressing Constitutional
issues of today couldn't have been

was written. Abortion was not a
formalized medical procedure, so
there was no question of "when life
begins," universal public schooling
was still a dream so there was no
question about prayer in the
schools, and slavery was an accep-
ted institution so there could have
been little debate over civil rights.
Despite its distant origins, the
Constitution remainstan important
document because it embodies a
spirit of freedoms and rights that
lawmakers from the founding
fathers on down have accepted. It
remains a viable part of the U.S.
legal system because its basic
truths can be applied to contem-
porary problems in light of
changing situations and changing
public perceptions.
No doubt some of the framers of
the Constitution intended it to
guarantee their rights to own
slaves, and in that respect their in-
tention should certainly carry no
Instead, Supreme Court Justices
have appropriately accepted the
basic tenets spelled out in the Con-
stitution and applied provisions
originally intended for a small
segment of society to all U.S.
What Edwin Meese proposes is
not only infeasible, but reactionary

To the Daily:
It's always good to know that
the University is always at the
height of fashion. We protest
apartheid, the SDI, the Vice-
President, NBC Television, the
Administration's policies in Cen-
tral America and South Africa
the CIA, "the Code", and
everything else of Fashion.
Why call it Fashion? Fashion
represents, according to
prevailing style," and today, the
above causes are "in style".
Now, while I will agree with
anyone who says bombing other
countries' populations is wrong,
does anyone besides me remem-
ber that, as you read this, the
Soviet Army and Air Force are
laying waste to the Afghan coun-
tryside, and that the Israeli Air
Force violated "national
sovereignty" by 1. invading
Lebanon and 2. Bombing the
nearly-completed Iraqui nuclear
power plant, killing French
technicians. I guess that's okay,
as no one protests these things
any more.
It is all well-and-good to protest
against the racist regime in South
Africa and its backing by the
Administration. But unless the
real economic -bulwark of the
regime collapses, not much will
be accomplished. This, I know, is
the point of divestment. But,
divestment does not keep the
corporations out of South Africa.
Tf vnn reallyI irwa* nt. to make *ba

any and all visitors from Israel,
including Yitshak Perlman.
However, I don't see this forth-
coming, as Israel has never been
a fashionable protest target, lest
one be labelled "anti-Semitic".
I'm sure that there are real
believers out there, and I too

believe that things need to
change. But by assaulting only
the fashionable, high-visibility,
low-risk targets, all one does is
become, as the Bush protesters,
an obnoxious rabble. No one
respects the obnoxious ones, and
your form, as it happens with

stylish causes, far outweighs
your substance. Until the true
causes are attacked, no construc-
tive change will occur, just
another protest.
-Roland S. Rogers

Protesters present foolish

image of


To the Daily:
As a student here at the
University for the last five years,
I am becoming more and more
concerned about the growing
reputation of this university to
protest public events.
Anytime television cameras
and newspaper reporters are
going to be on campus, left-wing
students seem to be able to
produce a group to protest some
subject complete with signs and
catchy slogans. It doesn't matter
that the reporters are here to
commemorate the 25th anniver-
sary of the Peace Corps, or the
Today show being on campus to
give the public an impression of
typical life on a large public
university campus, the
protesters are still out in force.
The unfortunate part of all this
protesting is that the views held
by these persons only represent a
small portion of the students
here. I know they don't represent
"ir ~%" - . u' T11~ws

my political views. However,
because of their ability to protest
public events, their views are
broadcast by the media, which
gives the general public the im-
pression that the slogans and
signs represent the general
feelings of the student body. .
I have received three commen-
ts from people in my home town
asking why students were
protesting at the anniversary of
the Peace Corps, one of the large
outgrowths of the 1960s. It was
hard to explain that people were
protesting the presence of the
Vice-President of the United
States on campus, not the Peace
Corps. How ludicrous that people

protest a governmental figure
being on campus, especially the
second highest ranking gover-
nmental official!
Granted, protests are ap-
propriate in some cases, in theW
right places and right times.
However, in the cases of the
Peace Corps anniversary and the
Today show being on campus, the
protests were inappropriate and
did nothing for the people
protesting. All these protests did
was to make the students of this
university look pretty foolish to
alot of the people across our

-Richard D. Maki
October 24


Names will be withheld only in unusual circum-
stances. Letters may be edited for clarity, gram-
mar, and spelling.


i_ w .m w d in AL, I

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