Here we go again. If you feel like the show from Washington D.C. is a never-ending wheel of misfortune you'd be forgiven. While Florida, Texas, Puerto Rico and the Virgin Islands work to climb out of the muck created by Harvey, Irma and Maria the political types in our Nations cess-pool of a capital have been trying, and failing, to repeal the Affordable Care Act and are now focusing their attention on cutting taxes.
This, as you can imagine, has the usual suspects in somewhat of a tizzy. It's even got the New York Times play-pretending that they're deficit hawks again. Of course, the Politifarce 'fact-checkers' are out in force trying to convince us that their opinions on the matter are in fact, facts, and voices from the left side of the political aisle are here to remind you that you don't NEED a tax cut at all. All that's left is an idiotic think-piece from Vox. Wait, nevermind, they've delivered.
Winning the prize for non-seriousness however is, as is typical, the non-relevant Houston Chronicle Editorial Board, who have decided to plant their flag directly within the confines of the Alternative Minimum Tax. Let that sink in for a minute. (Seriously Chronicle, it's past-time to shutter the Ed Board and redeploy the resources to something you can do fairly well [hint: local reporting])
Of course, there will be no shortage of opinion pieces telling you what you want and need by members of the ruling class. None of them actually touching on what could, or should, be done.
This happens because politics is a mess, the media has fallen down on the job for the last eight years and the rest of America is too busy arguing whether a bunch of Millionaire athletes protesting during the National Anthem is sufficient enough reason for them to either stop (or start) watching NFL football.
This is not to say that there are no good arguments against this tax cut. There certainly are. Kevin D. Williamson of the National Review (and a favorite read by the author of this blog) lays out the case against fairly succinctly, and without falling into the nutty trap surrounding the 'rich'. Unfortunately, most (if not all) of the criticism from the Left gets fixated on that and just.won't.stop.
Does America need a massive tax cut right now? My answer is probably not. But tax REFORM on the other hand is much needed. Let me explain.
The current tax code contains 74,608 pages of regulation. Not only is that a draw on time, resources and energy but it creates a complex web of regulation that's impossible to correctly navigate except under the simplest of returns, or with the greatest of financial resources. Part of the reason for this is just the nature of Federal regulation. Its designed, despite bills requiring regulation to be "clear and concise", to be complicated and vague in almost all cases. Government bureaucracies don't want things to be easy, because they always want to a) be able to come back and charge more and b) keep the option for fines and civil penalties open.
There's a reason that all guidance from Federal agencies is considered "non-binding" after all. This allows a low-level staff employee to come back on an audit and make a determination against even guidance by the organization itself. If you've ever sought guidance from the federal government at your work, and then been audited, you understand what I'm on about here.
The income tax code is no different. It's designed to do three things. First, to maximize the amount of revenue the government can extract from you under threat of force. Second, to create an unruly tax structure which increases the risk of error, which increases the government's ability to levy fines and penalties. Third (and most importantly) to reward political patrons.
Streamlining the tax code, flattening and broadening it, and reducing the gifts to political patrons should be of primacy in any reform plan. It's not entirely clear that Trump's GOP has this in mind. A secondary goal should be to reduce the number of people who are not paying in and not sharing in the tax burden with the rest of us. Current numbers put that figure at close to 50%. This means that almost half of Americans are being subsidized by the other half. If that number gets to 50% plus one, our democracy is kaput.
This doesn't mean that the rich should get a shave, that the middle class need more heaped on them, that businesses should be punished or that the poor should be made to pay 'their fair share'. What it means is that a flattening, broadening and simplification is desperately needed in order to knock the system back into balance.
Does the GOP plan do that? I'm doubtful. As a matter of fact, I think any plan that would do that would be so unpopular that Americans would fly into an apocalyptic rage were it to be proposed. The goal in America is to see the tax cut benefit them and start to be punitive at a level that's just above what they are making. Until we change that thinking, we're going to get what we have today, which is a wonky, hard to decipher mess of a system that can be gamed providing you have sufficient money.
In short: We're getting the tax code we deserve and we're getting it good and hard.
