Magazine article Insight on the News

The Evil Genius of Withholding

Magazine article Insight on the News

The Evil Genius of Withholding

Article excerpt

Step aside, Steve Forbes. You too, Jack Kemp. Nice try, Bill Archer. Its time to make way for Washington's real tax reformer, whose contempt for the tax code is second to none. Of the World War II origins of the federal withholding tax, he writes:

"There began a brutal, bare-knuckled assault on the lives and property and privacy of the American people. The withholding tax poured in more money than Beardsley Ruml (former chairman of R.H. Macy and Co. and of the Federal Reserve Bank of New York) could ever have imagined, partly because government soon learned what automobile and real-estate salesmen already knew - if you talk to the customer about monthly payments, never mentioning the total price, it is much easier to sell a car or a house. In tax collections, the term `take-home pay' entered the language, and soon it was clear the government could take in far more without serious complaint if it deducted the money before the taxpayer ever saw it. If the immense sums being collected had to be handed over in one lump sum, surely there would have been a revolt. The withholding tax allowed government to keep the rates high, [Congress] held on to it, an artesian well spouting cash, computers to count it and disburse it, an automatic, power-driven money machine never seen before and a true wonder of the world. With all this money theirs to spend, congressmen could buy votes and build post offices and roads and bridges and reelect themselves almost interminably. They did."

If that sounds like the voice of another right-wing crazy, think again. For those are the words of the avuncular David Brinkley, whose storied career as a newsman includes his service as moderator of the top-rated Sunday talk show that carries his name.

Brinkley, who made his last appearance Nov. 10 as moderator of This Week With David Brinkley, made news when, while praising his colleagues at ABC for their creativity, he dismissed President Clinton as a "bore." In a day when reporters routinely describe Republicans as extremists and worse, Brinkleys tepid criticism hardly is worth discussing. Far more interesting, as the quote above suggests, is his memoir, David Brinkley, published last year, which contains the most trenchant but readable account yet of government-turned-ATM machine.

Once upon a time, he explains, this country managed to get by on government revenues derived from high tariffs, which enriched U.S. businesses by protecting them from foreign competition and gouging consumers with higher prices. …

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