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The Pitfalls Of Clinton's Budget Plan


Readers Report

THE PITFALLS OF CLINTON'S BUDGET PLAN

Reading Paul Craig Roberts' column is a pleasure. His latest comments ("Clinton's budget isn't just bad--it's unconstitutional," Economic Viewpoint, Aug. 30) are not only wise but include an important warning. Yes, the "spending cuts" in the deficit-reduction plan promise to cut only the rate of growth in new spending, mostly after 1996, adding apparently $1.1 trillion to $1.7 trillion to the national debt in 1994-98.

But I agree that even more important is the retroactivity of taxes the plan mandates, presenting a threat of new precedents. The media certainly did not mention much, if anything, about this during the budget debate. At least this important information has been articulated for the readers of BUSINESS WEEK.

Fred W. Duenckel III

Tyler, Tex.

Paul Craig Roberts writes: "The House Budget Committee estimates that the plan will add $1.1 trillion to the national debt during 1994-98, with deficits averaging $220 billion a year. In contrast, Reagan's deficits during 1981-88 averaged $167 billion." The Reagan figure should be corrected for inflation. The adjusted Reagan average should be $227 billion.

I agree with Roberts when he says: "Misinformation is rife about the deficit reduction in Clinton's plan." Much of it is due to writers such as Roberts.

Robert Kahn

Lafayette, Calif.

Contrary to the opinion of Paul Craig Roberts, retroactive tax laws are not unconstitutional. In Calder vs. Bull (1798), the Supreme Court held that the clauses banning ex post facto laws apply to criminal statutes, not civil laws such as the tax code. Writing for the Court, Justices Chase, Patterson, and Iredell stated that "ex post facto" was a technical term that, since before the Revolution, had come to apply only to laws imposing or increasing criminal punishment. The opinion said the Constitution's makers must have "understood and used the words in their known and appropriate signification."

If Roberts' claim were true, how could the Court allow exceptions for tax increases made retroactive "only" to the date of proposal? Any retroactive criminal law is unconstitutional. If the same clauses applied to taxes, then there would be no exceptions.

Notwithstanding Roberts' policy objections to the Clinton economic plan, the Constitution is safe.

Michael J. Griffin

Oak Park, Ill.

Three cheers for Roberts' column about the unconstitutional Clinton budget plan. Republicans and other opponents of this plan should make haste, lest we lose our last bastion of protection against retroactive tax laws that will confiscate more wealth.

Donald S. Le Vie Jr.

Austin, Tex.


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