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Question to Ricochet: Is this a brilliant idea or what?
In Southern California for the Pacific Research Institute’s annual Baroness Margaret Thatcher Orange County Dinner last night, I had lunch shortly after landing with a veteran of political communications in this state.
Over our meal, he began to go on in the manner all of us go on about the cluelessness of Republicans in Washington. “In the course of one month,” he said, “Bengazi, the IRS scandal, and the tapping of the Associated Press all broke — and the GOP couldn’t do a thing with it.” I just listened. I thought he was being a bit harsh, but we all need to get these frustrations out now and again.
Then he said something that made me sit up, take note and, now, write this post.
“The GOP,” he continued, “should come out for a flat tax and announce that, thanks to all the administrative savings from so vastly simplifying the tax code, we’ll lay off half the IRS. Get rid of all those agents they hired for Obamacare and many more. Americans hate the IRS. The complexity of the tax code is a big reason for the agency’s corruption. And you get a tax code that is friendly to economic growth to boot. Tie the two issues — stagnation and corruption — together.”
“What a brilliant reframing of the discussion,” I thought. “And where better to test it out than Ricochet.”
So here is my question: What do you think?
Published in General
Yes, a wonderful selling point that not even the RNC could screw up.
You overestimate the competence of the RNC. In their defense, however, no matter how rational and clearly-presented the proposal, the MSM will do its part to sabotage anything which might go in favor of Republicans. One small example: remember the hype surrounding the Bush “jobless recovery” at 4.5% unemployment vs. the constant “improving growth & employment” for the past five years under The One. ·
Much as I want to commit violence against the MSM, it’s like raging against a stormy sea. Media bias is environmental. We can diminish its effects, not eliminate it. We have to invent better foul weather gear with which to repel it. We have hundreds of new ways, thanks to technological gains, to reach the heads of voters over the heads of the MSM censors. The real question is why we are not better at doing that. I don’t have an answer to that question.
Yes, a wonderful selling point that not even the RNC could screw up.
You overestimate the competence of the RNC. In their defense, however, no matter how rational and clearly-presented the proposal, the MSM will do its part to sabotage anything which might go in favor of Republicans. One small example: remember the hype surrounding the Bush “jobless recovery” at 4.5% unemployment vs. the constant “improving growth & employment” for the past five years under The One. ·
Much as I want to commit violence against the MSM, it’s like raging against a stormy sea. Media bias is environmental. We can diminish its effects, not eliminate it. We have to event better foul weather gear with which to repel it. We have hundreds of new ways, thanks to technological gains, to reach the heads of voters over the heads of the MSM censors. The real question is why we are not better at doing that. I don’t have an answer to that question. ·0 minutes ago
Yes! Republicans must practice journalistic judo – use the MSM’s strength against them. Surely strategies can be formulated to accomplish this.
Hugh Hewitt. He’s insistent that wemustkeep the home mortgage deduction.
Love Hugh’s show, but he is so in the pocket with the real estate and building industries on this one.
Flat means flat means flat. And if that means that we have to give up features of the Code that we happen to like, so be it.
Amen. I say that as a devoted Hughniversarian. I think some smart person can make the argument (probably already has) that the benefits to one’s long term wealth accumulation from the Mortgage Interest Deduction is offset by all the other calamities in the 75,000 other pages in the IRS codes. So then the issue becomes an equitable adjustment to current homeowners. If done right, it’s likely to be less expensive than the ‘stimulus’ and bailouts of GM and the banks.
Hell no!
If you want abolish the IRS it should be a national sales tax. Get the private citizen out of collection and payment of taxes and put it squarely on businesses. It will do several things: 1) It will secure the privacy of citizens – there will be no citizens tax I.D. associated with purchases only the tax collected and paid by the businesses. 2) It will bring current shadow tax collection (Payroll taxes.) out into the light and show everyone, private citizens and business owners/Corporations how much money the Federal Government is taking, or required for operation. 3) The Federal Government will collect taxes after the fact – when people purchase items after they have been paid. 4) It would be voluntary tax because private citizens would decide to purchase or forgo the purchase or buy used, to avoid the tax. 5) No reason for non-profit organizations to register with the IRS. 6) It would put the Federal Government and Businesses at odds as purchases drop off with citizens forgoing the extra expense of the national sales tax – $30,000 car with 21% tax – $6300 is hard to swallow especially when the tax would not be financed.
All of the comments reflect the fundamental conclusion that it would be great to do it, but it could be bungled in the marketing.
If the explanation of why someone is net better off is too complicated — it fails.
If the Democrats can sell that this is benefiting “the rich” — it fails.
If there is a near term spike in debt — it fails.
If freeloaders in sufficient numbers no longer get to freeload — it fails.
A lot of opportunity for failure (sigh).
The Party of Hell No! nailed it. Perfect.
We need additional, fundamental reforms in conjunction with tax simplification . . . like term limits.
How about a slight variation that provides an incentive?
Two birds, one stone.
If the Democrats can sell that this is benefiting “the rich” — it fails.
Good point. Fight class warfare with class warfare.
Include this:
Problem solved.
If the Democrats can sell that this is benefiting “the rich” — it fails.
Good point. Fight class warfare with class warfare.
Include this:
Problem solved. ·0 minutes ago
Hahahahahahaha!
Somehow we’d have to scrap the argument between fair tax and flat tax–choose one or the other and stick to it firmly. The major enemies of IRS abolition are IRS employees with their vast hordes of enablers. What if we could take one or two big expenditures–oh, farm subsidies or fed education, say, or congressional perks–and siphon those funds to offer very fat early retirement awards to all those workers? Something would have to make it a little less unattractive to a million tax accountants and lawyers, too.
BOOM!
Yes. Some sort of bribery will have to be involved.
And PS to Don Tillman: John Woo is going to be a busy guy: http://www.joshuakennon.com/how-much-money-does-it-take-to-be-in-the-top-1-of-wealth-and-net-worth-in-the-united-states/
This subject drives me crazy! So to continue the benefits: 7) It would eliminate death taxes, taxes on investments taxes on second homes or rental property. 8) No longer taxing Social Security benefits. 9) It would eliminate IRA’s and 401k’s (Which were created to avoid or forgo income tax in the present or in the future.). 10) It would eliminate the argument of income inequality – everyone would be subject to the tax at the point of sale, unless the citizen decided to forgo the purchase or buys used. 11) Wealthy people would pay far more in taxes since their 21% on luxury purchases would be far larger than those of non-luxury purchases, or they could purchase non-luxury items – again voluntary. 12) There would be no citizen opting out all would be subject to the tax unless they voluntarily avoided the tax. 13) It would eliminate federal government/private business collaboration to manipulate marketplaces i.e. mortgage interest deduction; the housing market would adjust to the true price of homes. 14)It would eliminate tax credits to businesses like, solar, wind, alcohol production; again they would have to collect the tax at point of sale.
There is zero incentive for politicians to embrace a flat tax and wholesale reform of the IRS, since the bulk of what gets them re-elected is the fact that they sell something back to the constituency – a tax break here, a tax credit there, means your rep is doing something for you.
Which is all garbage in the extreme. But that’s how they get re-elected. Strip them of this power and you’d find a much less invasive gov’t standing afterwards, and a much freer populace.
Which is why it will never, ever happen.
47% don’t pay income taxes
For a flat tax to be politically viable, the income threshold it applies to has to exclude these 47%, or it will seem like a raw deal to them.
Wonder how much money the accountant and tax lawyers would drum up to send the politicians on this one ?
I would wager that it would dwarf the amount that the plaintiffs lawyers have been giving. In fact it might be the biggest pot ever .
Would be to interesting to defuse that possibility prior to legislating, how could that be done ?
It’s a twofer: (1) the oppressive of the Bureaucratic State which is the best argument in favor of constitutionally limited government; and (2) the disgusting favortism built into the tax code in the past few decades.
Members of Congress will hate it because they love to hand out favors to supporters and constituents and the tax code is a treasure chest of favors that do not have an obvious budgetary expense.
I love it.
Excellent idea…The execution of it may well be daunting.
If you want abolish the IRS it should be a national sales tax.
I’m agnostic as to the precise form of simplification . . . have not thought it through. Must admit the sales tax is, on its face, the most appealing. That which is taxed is discouraged . . . why would you ever want to discourage income!?! Encouraging savings as opposed to spending, however, makes perfect sense.
But let’s remember we’ll need to abolish the 16th Amendment before a national sales tax goes into effect. Otherwise you’ll end up with both taxes, something the Incumbent Party would dearly love.
It would “fundamentally transform America”. People have been known to go for that.
Which is all garbage in the extreme. But that’s how they get re-elected. Strip them of this power and you’d find a much less invasive gov’t standing afterwards, and a much freer populace.
Which is why it will never, ever happen.
Such pessimism!?! If it didn’talways exist, there’s no reason it must exist. The Federal Income Tax has been with us a hundred years . . . there’s no reason it can’t be transformed into a flat tax or abolished in favor of a national sales tax. It just needs other reforms, like term limits, to be realized. The Incumbent Party won’t go quietly into the night.
Which is all garbage in the extreme. But that’s how they get re-elected. Strip them of this power and you’d find a much less invasive gov’t standing afterwards, and a much freer populace.
Which is why it will never, ever happen.
Which is why, starting a hundred years ago, the stripping of the republic features for democratic features to our system is such a killer. It would be so much of a better world if far more of the power was held at the state level. Your governor and state legislator would have more money and power to work with, and YOU would have more money, wealth, and a better life.
You, my friend, belong here: http://conventionofstates.com/
I like it. And I just wrote a new post for my own blog (RushBabe49.com), and I’m going to link to this article in my post. Thank You!!
It would be fun to have put forth in this legislative session by the House a tax reform bill with enough substance to effect some of what is covered in this post. If it were to be strong enough, many Democrats would likely oppose and it would be interesting to observe the establishment Republicans’ behavior and all the interactions with the various lobbyists and other interest groups, as well.
This could be coupled with the Obamacare campaign issues. Would that affect the tone of this year’s election campaign?
Personally, I love the idea, but once aired, it will be re-framed instantly as a job-killing, tax-avoiding scheme by greedy Republicans in the pocket of Big Business. And the LoFoVos will swallow that hook, line and sinker.
We need additional, fundamental reforms in conjunction with tax simplification . . . like term limits.
How about a slight variation that provides an incentive?
Two birds, one stone.
:-) I applaud the sentiment. But let’s remember the context. Getting Congress to pass ANY budget is a challenge. And OBTW, you can balance a budget by increasing taxes with greater political ease than by decreasing spending.
There are, I imagine, politicians who would tell you the Obama regime deficits are actually balanced . . . you see, those apparent deficits are really just “investments” for which a future pay-off will more than balance the current expenditure.
In the land where “I voted for it before I voted against it” actually makes sense to well educated fools, conjoined words like ‘balanced’ and ‘budget’ offer no serious impediment to reckless spending.
I was overcome by an irrational wave of optimism. Don’t worry, it passed, I’m better now. ·4 hours ago
No kidding. Reading all these fired up comments, I feel like I’m listening to the pep talk in the Lakers’ locker room, as they get ready to go out and be slaughtered by the Heat.
Flat taxes and sales taxes are always easier in theory than in practice. The Fair Tax has a complicated system of pre-bates and exemptions that require an organization at least as large as the IRS. Flat taxes on income either have to be so high they are politically prohibitive, or they won’t raise much money. Further, most of the complications of the IRC are not benefits or credits -they are definitions of what is “income.”
Let us write a simple law: “All income shall be taxed at 5%.”
We just bankrupted Walmart: profit margin 3.42.
Ah, we’ll just make sure we only tax their net profits. Wonderful. Now, is the company jet a cost of doing business? If it is, shall they be able to deduct it from their gross income all at once, or shall we force them to amortize it over a period of, say, 5 to 7 years.
Even the Home Mortgage Interest Tax Deduction began life because interest was universally considered a cost of doing business -and only when people began using debt to avoid taxation was this changed -by which point the HMITD was baked into the housing markets.