I’ve got good news and bad news. The good news is, hard-working taxpayers in Iowa are inching ever closer to Tax Freedom Day. The bad news is, Iowans needed to work 117 days for the government this year before they began working for themselves. According to the non-partisan Tax Foundation, Iowans — on average — will need to work from January 1 to April 27 just to fulfill their obligations to state, local and federal coffers.
Looking on the bright side, Iowans fare better than the nation when considered as a whole. American taxpayers, on average, won’t mark Tax Freedom Day until May 3. Also consider that Tax Freedom Day has jumped ahead from April 18 set in 1992, requiring more than two extra weeks of work from Americans just to pay their tax bills. Have government services improved proportionately in the last decade? Some taxpayers may feel they are getting a good deal. From education to national defense, roads and health research, taxes fund an array of critical government services.
Others feel strongly that bankrolling Uncle Sam and paying state and local sales and property taxes to boot take too big of a bite out of their paychecks. As a percentage of income, Iowa taxpayers shell out almost one-third of their earnings for taxes.
As chairman of the tax-writing Senate Finance Committee, I lend a sympathetic ear to those who feel their paychecks are milked by Uncle Sam for far too long. Taxpayers are bogged down by a bigger tax burden than ever before. American workers and their families should be allowed to decide how to save, spend and invest more of their own money. That’s why I’m working hard to reach a bipartisan consensus on the president’s tax relief plan. It’s wrong to filter such a great share of the gross domestic product through Washington. Federal revenue has climbed to 20.7 percent of GDP, the value of all U.S. economic output, and individual income taxes account for more than half of all federal revenue, up from 44.2 percent in 1993. It’s time for Uncle Sam to tap the brakes and let workers, not the government, become the main beneficiaries of rising incomes.
Take it from me. Money that gets sent to Washington gets spent. Or worse, it gets mis-spent. Consider Social Security. For every federal tax dollar you pay, 23 cents of it goes to Social Security. And despite a law enacted in 1996 to clamp down on fugitives cashing in on Social Security benefits, my Finance Committee has found the cash assistance program for the needy pays $30 million a year to fugitive felons. What’s more, the program pays disabled benefits to the tune of $39 million a year to this same group.
Unfortunately, the mis-spent buck doesn’t stop with Social Security. The Medicare and Medicaid programs also spend tens of millions of tax dollars a year on benefits to ineligible persons, such as prisoners, fugitives, the deceased, deportees, parole violators and others.
In fact, my committee calculates that at least $790 million annually — and as much as $831 million — is wasted through 12 benefit programs administered by the Department of Human Services and the Social Security Administration.
The Social Security and Medicare programs don’t have a penny to spare for non-eligible populations. Illegally paid federal benefits leave less for more deserving Americans and could undermine confidence in the retirement and health care programs for the nation’s disabled and elderly.
I’ve organized a congressional hearing to examine the scope of this problem and identify ways to troubleshoot flaws in the system. Whether it’s due to technical incompatibilities or inadequate system checks, improper payments must stop. Expanded information-sharing networks between law enforcement authorities and government agencies would help reduce improper payments made to parole violators and fugitives. However, less than half the states are participating in a computer matching program.
As far as I’m concerned, it’s time to plug the spigot and let the well run dry to incarcerated beneficiaries and other ineligible groups. Taxpayers work too long and too hard to have their tax dollars lining the pockets of convicted criminals. The government’s entitlement programs should not help pay for fugitives on the lam or benefit those behind bars.
In the meantime, I’m hopeful Washington can trim its tax and spending appetite and shave a few days off Tax Freedom Day 2002.