Skip to comments.The death of tax reform
Posted on 12/09/2012 9:02:10 AM PST by george76
The story behind the story is that tax reform, as we know it, is dying. During the 1980s, no major piece of legislation better symbolized bipartisan consensus than the Tax Reform Act of 1986, which was regarded by both liberal and conservative experts as the best tax law since World War II. The basic idea was simple: Reduce tax rates and recover lost revenue by ending (or limiting) tax breaks. The struggle between President Obama and House Speaker John Boehner over the fiscal cliff indicates that this beneficial consensus has collapsed.
Just the opposite is occurring.
many politicians support tax breaks for favored groups (the elderly, the poor, small business) and causes (homeownership, attending college, green industries). This enhances their power. The man who really pronounced the death sentence for the Tax Reform Act of 1986 was Bill Clinton, who increased the top rate to 39.6 percent rather than broadening the base. As the top rate rose, so did the value of generating new tax breaks. Ironically, many of the people who complain the loudest about Washington influence-peddling and lobbying are the same people who support higher tax rates, which stimulate more influence-peddling and lobbying.
(Excerpt) Read more at washingtonpost.com ...
What do they think they are, a newspaper?
This one’s a keeper.
The rates are higher now. There is less “loopholes” to eliminate or reduce.
So it sounds to me like cutting spending is the “compromise” Nowhere else to go but there.
After all, it should be the “bipartisan thing to do” right Samuelson?
-———Nowhere else to go but there.-———
The intended path is pretty clear to me. It is not as you say
what follows is deduced theory and not condoned practice.
The democrats all ready have the long term solution. It is cap and trade. The liberals have dug a hole from which they cant climb out. They have incrementally given their voters the ability to pay no taxes at all. There is no way they can take back the no tax position. At least 50 % of the population is in that group of nontax payers.
The solution is to provide a tax on the nonpayers that is not a tax and that is paid unknowingly. The payment fuels hate of someone else rather than the corrupt, vote needing, democrat, politician, liars. The solution is Cap And Trade.
The tax is levied on energy producers, all energy producers, that then can raise rates to all consumers. Since the tax is uniform it does not effect rate competition and can by all be passed on with no effect on sales. When passed on it is effectively a trickle down tax. I say energy producers but I think it is mainly electricity. It is a tax on electricity sales covered with a carbon fig leaf described as first aid for man made climate change.
The real and only solution to eliminating the debt is inflation that devalues the amount owed over time. The cap and trade induced rise in energy costs will be hidden within the coming general inflation. That is, the pain and associated hatred will be mitigated somewhat by the general rise in the cost of everything.
The Cap and Trade tax trickle down is coming. Thats what it is, a trickle down consumption tax. Many have tax proposals, VAT, Fair Tax, etc that will cause the 50% of non payers to cough up their fair share. But they are all taxes and new taxes will be strongly resisted by the 50%. An indirect trickle down tax will not be understood when sold as a planet saving necessity.
The beauty is that the value of the tax is compounded. In the coming inflation, the incremental total will be increased compounded by the inflation rate. As all prices, including energy prices are increased the $ value of C&T receipts increases as well.
Since the election, two efforts have begun. The first is to renew the media attention to those insisting on the need to curb climate change. The other is the effort by unions to increase wages. Both are harbingers of inflation. Cap and trade increases costs across the board for all business. In an economy with unemployment wages do not rise. For the needed inflation, labor costs must rise and push general costs up. The wage inflation is being pushed by the unions and will lead to general wage increases in spite of high unemployment.
Then there is the no tax pledge. One must wonder if supporting cap and trade violates the pledge? Charging a fee for carbon emissions is not actually a tax. The fee is like usage fees for visiting a National Park or the ports or perhaps a toll road. For a politician, even a Republican politician, voting for a fee is not voting for a pledge prohibited tax.
Yet spending will substantially accelerate, so any reductions are offset, plus more deficits. The more they “cap” etc the worse the economy gets, and so on down the line.
As I said, the only solution is cutting spending.
Just take Zippy’s ‘checkbook’ away.
That's all political theater. There's a huge consensus for bigger government and higher taxes for those who can't afford to avoid them.
Interesting. Seems to me a VAT might be better. Still hidden but easier to manage and it affect everyone in the supply chain, not just the energy producers.
I’m not arguing for the cap and trade or any other change. I’m merely reporting what I saw and extrapolating.
Soon after thanks giving I saw a liberal on Fox, Cavuto I think, that spilled the beans. He said they were going after Cap and Trade to collect tax from the energy companies who would all pass it on.
There is now much being said about climate change and about cap and trade.
I believe there is a major effort underway to try it again, immediately after we go or don’t co over the cliff.
You made a rational analysis.
Reason has nothing to do with liberal action. As long as they can get many folks to feel climate change is a threat, they will try again.
They are trying as we post