Americans Working Longer to Pay Their 'Cost of Government' Tab

By Monisha Bansal | July 7, 2008 | 8:23 PM EDT

( - Conservative taxpayer groups say Wednesday, July 11, marks the day this year when the average American worker will have earned enough to pay for his or her share of government taxes (federal, state and local) plus the cost of regulation.

Since 2001, the date has ranged from July 1 to July 12. It was July 12 last year.

"Right now taxpayers are under attack from Congress," Grover Norquist, president of Americans for Tax Reform," said at a Capitol Hill press conference on Tuesday.

"With tax increases on everything from cigarettes to private equity on the table, this year's 'Cost of Government Day' must spur politicians into action to protect taxpayers and the economic growth achieved under President Bush's tax cuts."

In his Saturday radio address, President Bush said his tax cuts "left $1.1 trillion in the hands of citizens like you to save, and spend, and invest as you see fit." Those tax cuts will expire in the year 2010 unless the Democrat-controlled Congress extends them, but a number of Democrats oppose the idea of giving "tax cuts to the wealthy."

"American taxpayers already work well over half of the year to pay for the cost of government," Norquist said. "The tax and spending spree must end."

Norquist called for fiscal restraint and reform of "entitlement programs."

Addressing the event, Rep. Phil English (R-Penn.) accused government of "siphoning off the vitality, the energy, the entrepreneurship in our free economy."

"This is a threat that is all the more dire for what we've seen coming out of Congress in this year's budget," he said. "The Democrat[ic] budget has made a conscious decision to head to bigger government and higher taxes.

"Not only would this bigger budget finance a saturnalia of new spending," he continued, "but it would also create a higher level of taxes, assuming the second-largest tax increase in American history and a series of tax increases that would be aimed at the most dynamic end of our economy."

Tom Schatz, president of Citizens Against Government Waste, said now that Americans have reached the point where they've worked long enough to covered their burden of taxes and regulation, they "can now begin to provide for themselves and their families. It should not take half of the national income to fulfill government's duty to protect life, liberty and property."

"Outdated, ineffective, duplicative and wasteful programs and agencies have clogged the system and extended the reach of government into our lives and wallets," Schatz said. "The best way to reduce the size of government is to eliminate the waste, fraud, abuse and mismanagement at all levels."

Mark Schmitt, a senior fellow at the liberal New America Foundation, took issue with the Americans for Tax Reform analysis, and called the Cost of Government Day "just another Washington interest group gimmick."

"Their calculation of the average taxpayer is very misleading," he told Cybercast News Service. "Eighty percent of Americans pay less than what they call the average."

Schmitt also said the tax reform group's claims have "nothing to do with either the actual cost or value of government."

Scott Lilly, a senior fellow at the liberal Center for American Progress, said Americans for Tax Reform is "challenged when it comes to the use of numbers."

It is not only individuals who pay for the cost of government or receive its benefits, he told Cybercast News Service. "Using only personal income assumes that corporations either do not or should not pay taxes."

"The real question is, what do the American people get in return for what they spend on government?" said Lilly. "Would most people rather eliminate public schools and pay to send their children to private schools? I am sure Grover would, but polling indicates that a large majority of Americans are firmly on the opposite side of that debate.

"Would most people prefer to eliminate the gas tax and have private companies build and maintain their roads?" he asked. "Should we sell our national parks and let private companies charge whatever admission fee that the market will bare? There are those in this group who believe that, but they are badly out of step with the rest of the country."

Lilly said government expenditures should be cut where possible.

"There is a large consensus in the country on where such savings can be found," he said. "The latest Gallup/USA Today poll shows more than 70 percent now support withdrawal from Iraq which would save more than $300 million a day."

On Capitol Hill, Democrats have promised to fix the Alternative Minimum Tax, a tax intended to make sure wealthy Americans pay something -- but which catches more and more middle-class taxpayers in its snare, because it's never been adjusted for inflation.

On Tuesday, press reports noted that there still is no "consensus" on how to reduce the AMT burden, although a temporary, last-minute fix is likely through the 2008 election year.

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