[Rhodes22-list] Taxes - Timely Article

[Bill Effros]

Rik,

If you had a clean slate, what would you put on it?

Bill Effros

Rik Sandberg wrote:
> Brad,
>
> Well, I finished reading her article ...... She's still scary .... 
> Wrong headed thinking....
>
> But, you are right. A clean slate is in order and IMO the only 
> worthwhile way to go.
>
> Rik
>
>
> Rik Sandberg wrote:
>
>> Brad,
>>
>> I have to admit, I came unglued right away and didn't read the whole 
>> article. Maybe I should go back now that I've settled down and finish 
>> it :)
>>
>> Yes, I AM in favor of a new sheet of paper. I still like the sales 
>> tax idea
>>
>> www.fairtax.org
>>
>> With this program, one could literally choose whether he'd like to 
>> pay taxes like a rich guy or pay very little. 'Course one's standard 
>> of living is going to have to reflect that choice. But for the 
>> conservative spender, saving for retirement might actually be a 
>> possibility.
>>
>> And Philip ..... there is a provision in this to repeal ..... uh, 
>> whatever the hell amendment it is, that allows income taxes.
>>
>> Rik
>>
>>
>> Brad Haslett wrote:
>>
>>> Rik,
>>>
>>> I understand your point.  However, comma, the bottom 50% pay very 
>>> little,
>>> and a huge hunk of that percentage don't participate anyway.  Let's 
>>> make it
>>> official.  The top 20% pay most of the taxes, in fact, the top 5% 
>>> pay most
>>> of them, but everyone get's one vote.  I say we start with a new 
>>> sheet of
>>> paper.
>>>
>>> Brad
>>>
>>>
>>> On 1/18/07, Rik Sandberg <sanderico at earthlink.net> wrote:
>>>
>>>>
>>>> Brad,
>>>>
>>>> Yikes!!! this woman is scary. I wonder if she isn't into the
>>>> Guinness......
>>>>
>>>> Subsidy, does she understand what that word means? How is taking 
>>>> less of
>>>> a persons money a subsidy? By her way of thinking ALL of our money
>>>> belongs to the government and nice guys that they are, sometimes they
>>>> let us keep a little of it.
>>>>
>>>> This little blurb is really precious
>>>>
>>>> "They are also extremely regressive. A particular
>>>> tax exemption might be worth 35 cents on the dollar to a wealthy
>>>> individual
>>>> and only 10 cents to someone on the other end of the income scale who
>>>> faces
>>>> a lower tax rate."
>>>>
>>>> Excuse me ....... how can you give a tax break to people who don't pay
>>>> any???
>>>>
>>>> I think I'm going to read Ayn Rand again and see if I can figure out
>>>> where all those guys went. It's starting to seem like a helluva good
>>>> idea. This next thing has been around before, but maybe some need
>>>> reminding. here's a link
>>>>
>>>> http://www.julianpistorius.com/journal/?postid=45
>>>>
>>>> Rik
>>>>
>>>>
>>>>
>>>>
>>>>
>>>>
>>>> Brad Haslett wrote:
>>>>
>>>> > Here's an article from today's WaPo that dovetails neatly with our
>>>> recent
>>>> > discussion.  Care to make a bet about the home interest 
>>>> deduction?  No
>>>> > one
>>>> > in the Congress has the guts to take on that sacred cow!
>>>> >
>>>> > Brad
>>>> >
>>>> > -----------
>>>> >
>>>> > *The $800 Billion Tax Loophole
>>>> > *
>>>> >
>>>> > By Maya MacGuineas
>>>> > Special to washingtonpost.com's Think Tank Town
>>>> > Thursday, January 18, 2007; 12:00 AM
>>>> >
>>>> > Democrats are in a bind when it comes to their domestic economic 
>>>> agenda.
>>>> > They have promised a number of new and costly initiatives such as
>>>> > fixing the
>>>> > Alternative Minimum Tax, providing middle-class tax relief, and
>>>> > increasing
>>>> > spending on homeland security and education. But they have also 
>>>> made a
>>>> > commitment to fiscal responsibility. So how can they deliver on 
>>>> their
>>>> > promises without opening themselves up to the old "tax and spend" 
>>>> label?
>>>> > Reforming tax entitlements -- a large, mostly under-the-radar 
>>>> part of
>>>> the
>>>> > federal budget -- might just give them a way out of their 
>>>> predicament.
>>>> >
>>>> > As a result of the 1986 bipartisan tax reforms, the tax base was
>>>> > broadened
>>>> > and the tax code was greatly simplified. But these reforms have been
>>>> > gradually undone as Congress has created scores of new tax breaks 
>>>> and
>>>> > loopholes. Want to preserve historic buildings, encourage 
>>>> alternative
>>>> > energy
>>>> > sources, help working families, or give certain industries a boost
>>>> > without
>>>> > appearing to increase spending? Voil? -- a new targeted tax break is
>>>> > born.
>>>> >
>>>> > Most tax expenditures are really spending programs designed to look
>>>> > like tax
>>>> > cuts. Picture them as vouchers for healthcare, mortgage payments,
>>>> > daycare,
>>>> > transportation -- name the tax break. Dressing these programs up as
>>>> > tax cuts
>>>> > makes them a much easier sell for politicians who fear the "big 
>>>> spender"
>>>> > label. But call them what you will, they drain the money from the
>>>> > Treasury
>>>> > and extend the scope of government. All told, this portion of the 
>>>> budget
>>>> > represents $800 billion in lost government revenues annually.
>>>> >
>>>> > Not only do these tax breaks mask the true size of the government,
>>>> > they are
>>>> > a terrible way to make policy. They regularly pay people and
>>>> > businesses to
>>>> > do what they would do anyway, making them both poorly targeted and
>>>> > unnecessarily expensive. They are also extremely regressive. A
>>>> particular
>>>> > tax exemption might be worth 35 cents on the dollar to a wealthy
>>>> > individual
>>>> > and only 10 cents to someone on the other end of the income scale 
>>>> who
>>>> > faces
>>>> > a lower tax rate. It would be hard to justify a housing policy 
>>>> that does
>>>> > more to subsidize the rich than the poor, yet that is exactly 
>>>> what the
>>>> > $80
>>>> > billion a year home mortgage interest deduction does.
>>>> >
>>>> > Moreover, tax expenditures do not get nearly the level of 
>>>> scrutiny they
>>>> > should. (If they did, would we really have a government program that
>>>> > subsidizes millionaires who buy vacation homes?) New government 
>>>> programs
>>>> > should only be created following vigorous debate over whether a 
>>>> proposed
>>>> > policy is important enough to warrant government intervention, 
>>>> and if
>>>> > it is,
>>>> > whether it will be effective. Discussions about new tax programs
>>>> however,
>>>> > tend to focus almost exclusively on the cost. Billions of dollars of
>>>> > targeted tax cuts have been passed in the past few years with little
>>>> > or no
>>>> > discussion about the worthiness of their goals. And unlike spending
>>>> > programs, which are subject to congressional review, tax expenditure
>>>> > programs are pretty much on automatic pilot.
>>>> >
>>>> > Reforming this area of the budget would not only be a critical 
>>>> step in
>>>> > improving the tax code (and probably the closest thing we will 
>>>> see to
>>>> > fundamental tax reform in the next two years) it could also generate
>>>> > tens --
>>>> > if not hundreds -- of billions of dollars in savings.
>>>> >
>>>> > The first step should be capping a number of existing tax breaks.
>>>> Capping
>>>> > two of the largest breaks -- the home mortgage interest deduction 
>>>> and
>>>> the
>>>> > exclusion for employer-provided healthcare, would easily provide 
>>>> over
>>>> $50
>>>> > billion a year in savings. Both of these changes would reduce the 
>>>> large
>>>> > subsidies that go to the highest earners while freeing up resources.
>>>> > Getting
>>>> > rid of a host of other tax breaks that subsidize certain 
>>>> businesses or
>>>> > industries could easily generate another $25 billion. A thorough
>>>> > review of
>>>> > the over 150 existing tax expenditures to determine which ones have
>>>> > outlived
>>>> > their usefulness would yield still more in savings. As Democrats
>>>> > search for
>>>> > ways to offset the costs of their new agenda, reducing the $800
>>>> > billion tax
>>>> > loophole would be an excellent place to start.
>>>> >
>>>> > *Maya MacGuineas is the Director of the Fiscal Policy Program at 
>>>> the New
>>>> > America Foundation.*
>>>> > __________________________________________________
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>>>> >
>>>>
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