Congress should give a major part of the projected surpluses of the next 10 years back to the taxpayers. After all, that's where the money came from. But Congress should return only that part of the surplus not attributable to Social Security.
If the money in excess of the Social Security surplus is not needed to meet the government's budgeted day-to-day needs, it ought to be refunded.
Otherwise it, and more, will be spent on programs that will expand forever, and that will turn out to be roughly twice as expensive as projected when they are passed.
Let's propose a variation of Parkinson's Law (that work expands to fill the time available).
Our version says:
* government spending expands to consume the amount of revenue that is available;
* government spending programs cost twice as much after 10 years as initially projected;
* once initiated, there is only a 10% chance that a government spending program, no matter how expensive, will be eliminated; and
* it's always easier for the government to raise taxes than to cut spending.
Given this law, the only way taxpayers can be protected from an ever-expanding government (a government that already consumes a peacetime record percentage of the gross domestic product) and large tax increases in the future is to give them a tax cut now.
Take the extra revenue away from the government.
Where did this surplus come from? It came from the strong economic growth the country has experienced since 1992, the huge tax increase in the first year of the first Clinton administration, and the 1994 agreement between the Congress and the White House to cut the rate of growth of federal spending.
The huge tax increase was based on predictions that the nation faced huge deficits as far as the eye could see.
Now that we no longer see those deficits, give some of that money back, quickly, before the government can waste it.
A meaningful tax cut should be the first use to which the surplus is put, not the last, as some politicians and commentators have suggested.
By their reasoning, every dollar the government can grab belongs irredeemably to the government.
In fact, some seem to have the view that, as in the old Soviet Union, every dollar of gross domestic product ultimately belongs to the government, which generously allows taxpayers to keep some of it.
Any tax cut should be an across-the-board cut in the marginal tax rates.
Yes, this means the higher-income earners will get bigger dollar tax cuts than lower-income earners, but they pay the largest dollar amounts of income tax. And, in fact, they were the only ones hit by the 1993 tax increase.
Some argue a tax cut at this time will only be spent, further stimulating an already strong economy. Not necessarily. There is some evidence the decline in the nation's savings rate since 1993 was, in fact, caused by the tax increase.
The high-income taxpayers, rather than cutting spending to pay the tax increase, instead cut their saving. Cutting taxes now might reverse that and increase savings.
The second use of any surplus should be to shore up Social Security.
But this goal should be achieved by paying down the national debt, which is, in effect, giving the money back to the people who lent it to the government, and also reducing the future interest burden on taxpayers.
One further advantage offered by this approach: it should mean lower interest rates overall.
Only when these priorities have been satisfied should any new spending initiatives be undertaken. And then Congress should, based on part two of our variation of Parkinson's law, double any 10-year cost estimate it receives from the Office of Management and Budget or the Congressional Budget Office.
This will accomplish three things:
* it will increase the chances that the estimate will actually be within sight of the true costs;
* it will reduce the number of unnecessary spending programs Congress or the administration can initiate;
* and it will increase the chances that those actually passed will be truly worthwhile.
If the government can raise taxes to eliminate a deficit, it can reduce taxes to eliminate a surplus.