A Cruel Tax

EVERY NOW AND AGAIN, the Reagan Administration lets its guard down long enough to reveal its true political colors and the sight is rarely pretty. Last week's disclosure that the White House was considering a study proposal to tax unemployment benefits revealed not only dubious economic thinking but callous political style as well.

The rationale for an unemployment benefits tax, as explained by Martin S. Feldstein '61, the President's choice to chair the Council of Economic Advisors, is that it would, in other words, make unemployment even less appealing relative to holding a job. That argument, however, rests on a shaky hypothesis. It assumes that 10.4 percent of Americans without jobs have willfilly shunned work because their unemployment benefits of up to $12,000 a year were too cushy an alternative.

Even President Reagan himself has rejected that interpretation in the past. Seeking to explain why his Administration could not reduce the jobless rate, the President earlier this year blamed structural unemployment--a workforce which, through no fault of its own, is uneqiupped to meet the needs of a changing market. Last week's proposal also seems thoroughly inconsistent with the President's view of taxation, the very process which Reagan has called burdensome to the economy as a whole.

In calling the unemployment cutback a tax, then, the President is merely linguistically shrouding what it really is--a new budget cut to help bail the Administration out of its budget deficit problem. While reassessing costly benefit programs is in itself entirely reasonable, the White House's backdoor style an describing and disclosing the concept warrant disdain.

The unemployment benefits tax idea was initially floated to the media by anonymous Administration officials, but after the suggestion was greeted with a firestorm of criticism, the White House began to scramble pathetically to disavow the proposal. President counselor Edwin Meese's disclaimer was typical: The tax plan, he said, should not be taken seriously--for although it has been sitting on the President's desk, the Chief Executive had yet to peruse it. The very surprise that Presidential aides showed at the proposal's negative public reception suggested profound lack of understanding the nation's political concerns today.

The cruelest irony of the unemployment tax suggestion is that the Administration, for whatever reason, chose to unveil it on Thanksgiving. The nation's poor have once again been left wondering what in Reaganomics they have to give thanks for--and whether the President's Christmas gift to he jobless rolls he has created will be another nasty surprise.