I could use the money. So could you. Why a big tax cut still isn't such a great idea

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Lord knows I could use the money. I have too much credit card debt, eat too much pasta, and routinely glance at a fellow straphangerís Wall Street Journal in the morning to try and save that 75 cents a day. The best financial news Iíve had lately was that I never found the money to buy stock in AOL (battered along with the rest of the techs last week, it hit 77 Thursday, down from 170 in April). Risk capital? It's tough enough to find rent capital, and Iíll bet, boom or no boom, that Iím not alone.

So why donít I want a tax cut? The Republicans tell me their compromise combo platter, currently ambling toward a White House veto, is just what Iíve been dreaming about at night: a 1 percent reduction in income taxes and less taxes on what Iím saving for retirement. And the slashing of capital gains taxes and the so-called marriage penalty, well, Iím sure theyíd come in handy if I had a stock portfolio and a wife (someday!). So whatís not to like?

First of all, it ainít that much, not for most of us. Those nice accountants at Deloitte & Touche calculate that a couple with two children under 17 and an income of $50,000 -Ė thatís about average -- would receive an annual tax cut of $265. One car payment, maybe. As the late, great Chris Farley used to say, whoop-de-freakiní-do.

On the other hand, say the bean-counters, the same family making $200,000 Ė- thatís way above average -- gets $2,720. Hmm. Still not a windfall, but I think you can see where this is going: The higher up the income ladder you are, the more you get -- and itís only gotten worse for ordinary joes like me since the House and Senate bills were combined. Under the Senate bill sponsored by William Roth (who brought us the laudable Roth IRA), the middle 60 percent of American families, who pay a third of all taxes, would have gotten 33 percent of the tax breaks. Now theyíre getting 21 percent. Roth had the top 20 percent of incomes, who pay two-thirds of the taxes, slated for 66 percent; now theyíre getting 79 percent of the breaks. Yes, Denny Hastert, the rich pay more taxes than the rest of us. Thatís because theyíve got more money.

Class squabbling aside, most folks seem to agree that paying down the national debt -- as long as weíve got some extra money Ė ought to be our first priority. Theyíre absolutely right. And the polls indicate that people also think that Bill Clinton is the man to do it for them. (This impression, most likely, is the result of countless Clinton speeches about irresponsible "instant gratification" on the Republican side and safe, sane saving for the future by your friends at the White House.) Clinton keeps saying only he can save Medicare and Social Security; the Republicans say they can save the sacred cows and pay for a tax cut, and still keep the debt shrinking and the budget balanced. And hereís where it gets complicated, if not surprising: Both sides are fibbing.

See, both Clinton and the Republicans have already promised to devote two-thirds of the projected $3 trillion, ten-year surplus on shoring up Social Security and Medicare. (In the short term, that means national-debt reduction, because the programs are still healthy, and will remain so for 20 years or so until the baby-boom retirement hits us full-force.) The fight is over that last trillion (give or take a few hundred billion). Republicans want to give $792 billion of it back to the people, and Clinton wants to spend a nearly equal portion -- $750 billion, by some calculations -- on defense, on education, on new Medicare benefits like prescription-drug coverage. Heís willing to cut taxes a little, and Republicans are willing to spend a little, but thatís essentially it.

Republican leaders say every dollar they leave on the table will just get spent by the "Washington bureaucrats" -Ė code for either Clinton or some Democratic Congress of the future. Give it all back now, and government will have to stay small. But that disciplined future is a little hard to imagine when right now in the House, Republican super-whip Tom Delay is proudly spending next yearís surplus "and then some" just to make sure thereís no money left for Clinton except for what he promised he wouldnít touch. "We will negotiate with the President, after he vetoes the bills, on his knees," DeLay said Thursday. And itís hard to imagine Democrats, a year or two or five from now, having any more self-control when theyíve gotten sick of George W.

The thing is, both Clintonís plan and the Republicansí stand an excellent chance of busting the budget, but good. If, in the next decade, the economy hiccups, or so-called "emergency" spending increases, or something unexpected simply comes up, that $3 trillion evaporates pretty fast. So why canít I say no to both? Thatís what Alan Greenspan said to Congress last week, although neither side seemed to want to hear it that way. Set the surplus aside, said Sir Alan, because itís not even paper money yet, and because Americans might really need a tax cut someday. (Oh Ė- and he really hates inflation.)

But if Nature abhors a vacuum, Washington abhors extra money. It must be disposed of, somehow, and soon enough to get re-elected with. (And in a ten-year block, no less) If we get lucky, the current standoff will harden into a stalemate, and at least this yearís surplus will go where it belongs -Ė into the bank. If not, then I guess Iíll settle for the compromise favored by a handful of moderates (A tip: for some of the best fiscal policy out there, look for the Republicans who break ranks with their party): $500 billion in tax cuts, and throw in a few, but not all, of Clintonís worthier give-outs. Give me $100, and weíll call it even. Or give me Jesse Ventura.