Rick Lowe

Anthony de Jasay tells us in this article that, "The two houses of the German federal legislature have enacted a constitutional amendment that limits the combined deficits of the federal and state governments from 2016 onward to an average of 0.35 per cent of national income."

This is obviously a very difficult thing for politicians to do as they make careers by promising to "help" people using other peoples money, so as Dr. Jasay points out, taxes will rise to accommodate the spending.

He says:

…For really large increases in tax revenues, the government must turn to excise, sales or value added taxes. These are politically less easy targets. They are regressive, hitting the poor and the middle strata more than proportionally. If each round of higher government expenditure is regularly accompanied by a round of higher consumption taxes, even the more obtuse kind of voters will soon get wise to the fact that they are paying the price of every "gift" the government hands them."

It's hard to disagree with these points. And The Bahamas seems at these very same crossroads today with our tax system maxed out as result of all the borrowing and spending and deficits over the last 35 years or so.

So on the one hand the government is correct to attempt to bring government deficits and spending under control, (the way they have approached it notwithstanding) but on the other, should they be allowed to change the tax system to get more revenue? Because as history reports, they've borrowed and spent the country into this spiral that is exacerbated by the world economic turmoil. So why should we roll over for a new tax system for them to do the same thing?

I have always thought that the import tax structure was best to keep government spending in check, but I never considered that they would simply borrow themselves into a crisis.

So while the FNM are at it, with their austerity Budget, why not enact amendments to limit government deficits, debt and spending?