Analysis: Tax reform impossible? Reagan did it 25 years ago

Reuters ^ | October 21, 2011 | Reporting by Patrick Temple-West; Editing by Carol Bishopric

[decimon]

WASHINGTON (Reuters) - Tax reform can happen in the United States. President Ronald Reagan and a divided Congress defiantly proved it 25 years ago this Saturday.

On both sides of the acrimonious tax debate, no event is held in such awe today as the historical moment when Reagan signed tax reform into law on October 22, 1986.

"All of the betting was that (reform) was impossible," said Michael Graetz, a tax professor at Columbia Law School.

But it got done. Even now, tax lobbyists still shake their heads in disbelief at the 1986 reform. The fact that no comparable achievement has followed, a quarter-century and four presidents later, makes the feat all the more remarkable.

And it begs the obvious question.

With the U.S. fiscal situation so much more dire, why is it not happening now? Even with wide agreement in both parties that the tax code is a loophole-ridden jumble of inefficiency and unfairness, even tentative reform has been unattainable.

The answers are four-fold, said academics and some of the tax experts who helped craft the reform of 25 years ago:

First, glaring loopholes are fewer today; second, the deficit's size blocks agreement on revenue neutrality; third, Reagan raised corporate taxes, but this is harder now; and fourth, a lower capital gains rate is more deeply entrenched.

[ichabod1]

SLASHING the top tax bracket from like 90% to 28% was not just a tweak. The real problem was getting in bed with the Bush’s immediately after Reagan’s 8 years, which enabled them to dismantle what he had done, though the good times rolled on for a long time after that.

[ichabod1]

There are times when we must act as men of old and stand up in the face of oppression. This Shall Not Last. It may not be destroyed in our lifetimes, but in that case we must keep the flame of Liberty & Justice for All alive in our hearts and in the hearts of our children.

[cuban leaf]

—There are times when we must act as men of old and stand up in the face of oppression. This Shall Not Last. It may not be destroyed in our lifetimes, but in that case we must keep the flame of Liberty & Justice for All alive in our hearts and in the hearts of our children.—

That is what I am doing. Problem is, what does “...act as men of old and stand up in the face of oppression.” really mean? For them it meant taking up arms against their own government.

That seems rather suicidal to me. I’m seeing our government collapsing around me so my way of “standing up” is to do as the main character in “The Pianist” did: Survive to thrive when they collapse. That’s it. It’s all encapsulated in that.

[ichabod1]

Did we stand up and say HELL NO after 911? Hell Yes. We will NEVER submit to government rule or mob rule or any kind of rule. We are going to win this thing. I fear they have awakened a sleeping giant.