Opinion: The most important thing to get right about tax reform

Like Senate Majority Leader Mitch McConnell on Thursday night, tax reform marches on in Congress. (AP Photo / J. Scott Applewhite)

Tax reform is moving forward after the Senate on Thursday approved a budget resolution authorizing up to $1.5 trillion in new deficits over the next 10 years. This leaves a number of people uneasy about the nation’s finances, as it should after Republicans spent the Obama years (rightly) railing against deficits and debt.

The question is whether meaningful tax reform can be done that doesn’t significantly increase the deficit. And the answer is yes.

Jeffrey Dorfman, an economics professor at the University of Georgia and regular contributor to Forbes, recently explained at National Review why lowering the rate is more important than lowering revenues if the goal is growth (as it should be). Here’s an excerpt:

“Your marginal income-tax rate is the percentage you pay in taxes on your last (or next) dollar of income. If you’re in the 25 percent tax bracket, for example, your marginal rate is 25 percent — you lose 25 cents of each additional dollar you make, even though your average tax rate will likely be closer to 10 percent of your total income after deductions, credits, and exemptions are applied. Lower marginal rates help boost growth because they increase individuals’ incentive to work harder and businesses’ incentive to invest in new opportunities. While people debate how big this effect is, it is a consensus belief that lower rates are pro-growth even when coupled with base-broadening measures that ensure the same amount of tax revenue is collected.

“When it comes to the corporate income tax, rate cuts not only spur growth but raise wages as well. Glenn Hubbard, dean of the Columbia Business School and a former head of the White House Council of Economic Advisors, has written that 70 percent of corporate tax cuts may go to higher wages instead of payouts to shareholders. Other research has suggested a range of 45 to 75 percent.

“This idea, that cutting taxes on corporations actually benefits workers along with shareholders, is more controversial and much less appreciated. However, among experts in the field it seems to be a reasonably well-shared and non-partisan view. This is important because the more middle-class workers benefit from cuts to corporate tax rates, the more such cuts are consistent with the ideals of a progressive tax system.

“What about the idea of bringing in less tax revenue overall, providing a stimulus to the economy by letting people keep more of their money? A bevy of central-bank research economists from around the world studied the effects of fiscal stimulus (including tax cuts and deficit spending) in the wake of the most recent recession. Their research shows that larger deficits don’t stimulate the economy much, particularly when the deficits are seen as permanent (as they would be from a tax cut) and when the Federal Reserve is not accommodating. Accommodation from the Fed typically involves interest-rate cuts, in contrast to the Fed’s current posture of slowly increasing rates. Given that the Fed is unlikely to meet this tax-reform package with monetary accommodation, central-bank models suggest that the size of the tax cut will not determine how pro-growth tax reform is; it is rate cuts that matter.” (links original)

Read the whole thing for a fuller explanation, but here’s Dorfman’s bottom line: “Republicans should prioritize rate cuts: Get the marginal rates for individuals and corporations down so that we can get back to more normal levels of economic growth, and broaden the base enough to make the changes revenue-neutral or at least close to it.” That’s exactly right.

While we’re talking about tax cuts and deficits, it’s a good time to remind my conservative friends that the line that “tax cuts pay for themselves” is not always or even usually true, especially in the short term. The Laffer Curve is one of the left’s favorite things to lampoon, but that’s because they have failed to appreciate it for what it is, just as too many conservatives have. The Laffer Curve does not say all tax cuts produce more revenue; far from it. It simply makes visual an obvious truism: At a rate of zero percent the government would collect no tax revenue, but this is also true at a rate of 100 percent (because no one would bother to work if all their earnings went to the government). You can’t connect the two with a straight line, since we know the government collects tax revenue from rates between zero and 100, so there has to be a curve. Revenues rise up from zero to a maximum point, and then start falling again toward 100, because behavior changes in response to policy.

By Vanessaezekowitz at English Wikipedia, CC BY 3.0, https://commons.wikimedia.org/w/index.php?curid=6889442

While this is obviously true, there’s an enormous problem: At any given time, we don’t know where we are on the curve. As you’ll notice, the above graphic not only doesn’t define the rates at which revenue rises or falls; it also illustrates that the curve could shift to the left or the right. That’s why the Laffer Curve tells us that revenue could rise or fall as rates change, but it can’t tell us which is going to happen.

Static scoring of tax policy fails to capture the behavioral effects of the policy — with the ridiculous result, in the extreme, of forecasting more revenue from a 100 percent tax rate (as the Congressional Budget Office once infamously projected). Dynamic scoring attempts to capture these effects, but it’s often inaccurate because it’s very hard to forecast exactly how people will respond to tax changes — especially when we are talking about the entire nation.

All the more reason, given our precarious national finances, to focus on lowering rates rather than on lowering revenues. Improve the incentives to work and invest, and the resulting economic growth should be good for both workers and government revenues in the long run.

Reader Comments 0

133 comments
Doomy
Doomy

@JohnnyReb


Um. That's a little bit too much logic for the progs to handle. 

Falcaints
Falcaints

There will be no raises for workers.  How long can Republicans peddle this fantasy to their base?  The most efficient use of that money will be stock buy backs, dividends, and executive compensation.

breckenridge
breckenridge

October 22 - Former White House Chief Strategist Steve Bannon name-dropped Senator John McCain in a speech to California Republicans on Friday, eliciting loud boos and even a call to "hang him" from the crowd. In a keynote address delivered during California Republicans' fall convention in Anaheim, Bannon ripped into both McCain and former President George W. Bush, deriding their leadership and intelligence much to the apparent pleasure of the crowd.

Gee. Talk about radical activists.  The Weather Underground had nothing on this bunch. 

Doomy
Doomy

@breckenridge


The weather underground bombed and killed people. Has Steve Bannon bombed or killed anyone? 

wagu
wagu

o͙u͙r͙ b͙u͙d͙d͙y͙'s͙ s͙i͙s͙t͙e͙r͙ i͙n͙ l͙a͙w͙ g͙e͙t͙s͙ 88 a͙n͙ h͙o͙u͙r͙ a͙t͙ h͙o͙m͙e͙, s͙h͙e͙ h͙a͙s͙ b͙e͙e͙n͙ u͙n͙e͙m͙p͙l͙o͙y͙e͙d͙ f͙o͙r͙ f͙i͙v͙e͙ m͙o͙n͙t͙h͙s͙... l͙a͙s͙t͙ m͙o͙n͙t͙h͙ h͙e͙r͙ p͙a͙y͙m͙e͙n͙t͙ w͙a͙s͙ 13518 j͙u͙s͙t͙ w͙o͙r͙k͙i͙n͙g͙ a͙t͙ h͙o͙m͙e͙ f͙o͙r͙ 5 h͙o͙u͙r͙s͙ p͙e͙r͙ d͙a͙y͙. g͙o͙ h͙e͙r͙e͙ t͙o͙ t͙h͙i͙s͙

www.smartpay7.com

SGTGrit
SGTGrit

It seems that over 90% of the time we read about crime it's a black face we see as the perpetrator. The only hope is a growing number of well educated black conservatives that are speaking out and hopefully, becoming role models, The Democrats are trying to silence the black conservative voices in this country. Political correctness needs to cease.

Audrey M. Naquin
Audrey M. Naquin

  ιғ you tнιnk Peggy`s story ιs terrιғιc..., ғour weaks-agoмy aunts step daugнter basιcally brougнt ιn $6030 sιttιng tнere aғourty нourмontн ғrom tнeιr apartment and tнere ғrιend's нalғ-sιster`s neιgнbour dιd tнιs ғor 7-montнs and got acнeque ғorмore tнan $6030 ιn tнeιr spare tιme ғrom tнeιrlabtop. tнe steps avaιlable нere................................................

>>>>>>>>>>>http://www.timejob9.com/

breckenridge
breckenridge

October 20 - Five arrests were made Thursday in connection with an event that self-described white supremacist Richard Spencer held at the University of Florida campus in Gainesville.

 

Three men were arrested for their alleged role in a shooting incident following Spencer's speech, according to the Gainesville Police Department. The three suspects "engaged in an argument with another group of people that turned violent with gunfire," police said in a press release today. 

The three individuals -- Tyler Tenbrink, 28, William Fears, 30, and Colton Fears, 28 -- are all from Texas, according to police. 

 The police report for Tenbrink states that while in a car, the suspects pulled up to the victims and one of the three men shouted "Hail Hitler and other chants" before "an argument ensued." According to police, Tenbrink got out of the vehicle with a handgun and threatened to kill the victims, while the two other men encouraged him to shoot them. Polie said Tenbrink fired a single shot that "thankfully missed the group" and hit a nearby building.

================================

The stupids have been very quiet about this. Surely at some point they'll weigh in with a verbal attack on Antifa.

Mia Lady
Mia Lady

j­o͆s͆­h͆u͆­a͆. t͆ru͆­e͆ t͆­h͆­a͆t͆ ­h͆­a͆rry͆`s͆ r­e͆­p͆0rt͆ ­i͆s͆ u͆­n͆­i͆­m͆­a͆­g͆­i͆­n͆­a͆­b­l͙­e͆, ­o͆­n͆ w͆­e͆­d͆­n͆­e͆s͆­d͆­a͆y͆ ­i͆ ­g͆­o͆t͆ ­a͆r­i͆­e͆­l͙ ­a͆t͆­o͆­m͆ ­fr­o͆­m͆ h͆­a͆v­i͆­n͆­g͆ ­m͆­a͆­d͆­e͆ $7508 t͆­h͆­i͆s͆ - 5 w͆­e͆­e͆­k͆s͆ ­p͆­a͆s͆t͆ ­a͆­n͆­d͆-ju͆s͆t͆ ­o͆v­e͆r, t͆­e͆­n͆ t͆­h͆­o͆u͆s͆­a͆­n͆­d͆ ­l͙­a͆s͆s͆ ­m͆­o͆­n͆t͆­h͆. w͆­i͆t͆­h͆­o͆u͆t͆ ­a͆ qu͆­e͆s͆t͆­i͆­o͆­n͆ ­i͆t͆ ­i͆s͆ t͆­h͆­e͆ ­m͆­o͆s͆t͆ ­f­i͆­n͆­a͆­n͆­c͆­i͆­a͆­l͙y͆ r­e͆w͆­a͆r­d͆­i͆­n͆­g͆ ­i͆ ­h͆­a͆v­e͆ ­e͆v­e͆r ­h͆­a͆­d͆. ­i͆ ­a͆­c͆t͆u͆­a͆­l͙­l͙y͆ s͆t͆­a͆rt͆­e͆­d͆ t͆­h͆r­e͆­e͆ ­m͆­o͆­n͆t͆­h͆s͆/­a͆­g͆­o͆ ­a͆­n͆­d͆ ­i͆­m͆­m͆­e͆­d͆­i͆­a͆t͆­e͆­l͙y͆ w͆­a͆s͆ ­m͆­a͆­k͆­i͆­n͆­g͆ ­o͆v­e͆r $79 ­p͆­e͆r/­h͆r. ­i͆ w͆­o͆r­k͆ t͆­h͆r­o͆u͆­g͆­h͆ t͆­h͆­i͆s͆ w͆­e͆­bs͆­i͆t͆­e͆,,­g͆­o͆ t͆­o͆ t͆­h͆­i͆s͆ s͆­i͆t͆­e͆ ­h͆­o͆­m͆­e͆ t͆­a͆­b ­f­o͆r ­m͆­o͆r­e͆ ­d͆­e͆t͆­a͆­i͆­l͙............. jobsheat.com

Doomy
Doomy

@breckenridge


What is there to talk about? The man who shot the gun, and probably the 2 with him, need to serve jail time. 


Did you honestly think real conservatives were going to defend the actions of these 3 racists?


The point, which many cons have brought up before, is that cons believe and want fellows like these 3 to be prosecuted for their actions and that the progressives on the other hand will dutifully excuse and justify the violence of crazies on the left like Antifa. 


Are you starting to get it? Cons deplore and condemn this kind of behavior, progs excuse and justify violence if it comes from their side. 

breckenridge
breckenridge

@Doomy @breckenridge 

Yeah I get it. That filthy gutless punkrd Steve Bannon brought that trash into the GOP.

Your denial is laughable.  You're a stooge's stooge.

Doomy
Doomy

@JFMcNamara


'They are taking money from us and giving it to the rich"


And if you could only show us where they are planning on taking money directly from middle class folks and sending that money to rich folks. 


When you have to LIE to make a point you really don't have a point. 


"or is this not a decrease because it's still an increase or some other convoluted logic"


Lemme help ya out there, pardner. When you increase spending you are increasing spending. Doesn't matter if you are decreasing the rate of increase in the increased spending. You are still increasing spending. 


Furthermore, when you are still increasing spending beyond the rate of inflation it's completely illogical to state that you are making a "cut in spending" when the increase still exceeds the inflation rate. 


Hopefully I've dumbed it down enough for you to understand. If not then see me after class. 

breckenridge
breckenridge

October 20 - Georgia Republican state Representative Betty Price — wife of  former Health and Human Services Sec. Tom Price — has called for HIV-positive people to be quarantined and for their sexual partners to be logged and tracked by the government. 

Price — a physician — made the comments at a Georgia House commission meeting about improving state residents’ access to healthcare. She directed her question to Dr. Pascale Wortley, the director of the HIV Epidemiology Section for Georgia Department of Health.

“Before you proceed if you wouldn’t mind commenting on the surveillance of partners, tracking of contacts, that sort of thing. What are we legally able to do?” asked Price.

“And I don’t want to say the quarantine word,” she went on, “but I guess I just said it. Is there an ability, since I would guess that public dollars are expended heavily in prophylaxis and treatment of this condition, so we have a public interest in curtailing the spread. What would you advise or are there any methods legally that we could do that would curtail the spread?

================================

Betty Price....Betty Price.......hmm........that name rings a bell...........didn't she star in Debbie Does Dallas?

Gene Hartke
Gene Hartke

Tax reform is GOP code for tax cuts for the wealthy. Mysteriously, rising wealth inequality between the wealthy and middle class is left out of this trickle down ridiculousness. And, it's funny how keeping deficits down doesn't matter when passing the $700B military budget.

Doomy
Doomy

@Gene Hartke


"Mysteriously, rising wealth inequality between the wealthy and middle class is left out of this trickle down ridiculousness."


Lemme help ya out there, pardner. The traditional parameters of what we define as "the middle class" show that the middle class is getting smaller. Why is it getting smaller? It's getting smaller because almost 2/3rds of what constituted the middle class have now moved into the upper band of income.


Now perhaps in the twisted world of the kook left middle class people getting wealthier is a bad thing. But in the real world more middle class folks getting wealthier is a good thing. 

..Layla.
..Layla.

g̲00g̲l̲e̲ ̲p̲a̲y̲ ̲85$ ̲p̲e̲r̲ ̲h̲o̲u̲r̲ ̲m̲y̲ ̲l̲a̲s̲t̲ ̲p̲a̲y̲ ̲c̲h̲e̲c̲k̲ ̲w̲a̲s̲ ̲$8500 ̲o̲p̲e̲r̲a̲t̲i̲n̲g̲ ̲a̲ ̲h̲u̲n̲d̲r̲e̲d̲ ̲h̲o̲u̲r̲s̲ ̲p̲e̲r̲ ̲w̲e̲e̲k̲ ̲o̲n̲-l̲i̲n̲e̲. ̲m̲y̲ ̲y̲o̲u̲n̲g̲e̲r̲ ̲b̲r̲o̲t̲h̲e̲r̲ ̲f̲r̲i̲e̲n̲d̲ ̲h̲a̲s̲ ̲b̲e̲e̲n̲ ̲a̲v̲e̲r̲a̲g̲i̲n̲g̲ ̲12k̲ ̲f̲o̲r̲ ̲m̲o̲n̲t̲h̲s̲ ̲c̲u̲r̲r̲e̲n̲t̲l̲y̲ ̲a̲n̲d̲ ̲h̲e̲'s̲ ̲e̲m̲p̲l̲o̲y̲e̲d̲ ̲c̲o̲n̲c̲e̲r̲n̲i̲n̲g̲ ̲t̲w̲e̲n̲t̲y̲ ̲t̲w̲o̲ ̲h̲o̲u̲r̲s̲ ̲p̲e̲r̲ ̲w̲e̲e̲k̲. ̲i̲ ̲c̲a̲n̲’t̲ ̲b̲e̲l̲i̲e̲v̲e̲ ̲h̲o̲w̲e̲v̲e̲r̲ ̲s̲i̲m̲p̲l̲e̲ ̲i̲t̲ ̲h̲a̲d̲ ̲b̲e̲e̲n̲ ̲o̲n̲c̲e̲ ̲i̲ ̲a̲t̲t̲e̲m̲p̲t̲e̲d̲ ̲i̲t̲ ̲o̲u̲t̲. ̲t̲h̲i̲s̲ ̲i̲s̲ ̲o̲f̲t̲e̲n̲ ̲w̲h̲a̲t̲ ̲i̲ ̲d̲o̲.

        ░A░M░A░Z░I░N░G░ ░J░O░B░S░

°°°°°°http://ow.ly/pqaC30fgvnI 


Doomy
Doomy

Sometimes ya just gotta laugh when the kook left gets one of their ridiculous social engineering policies put into place and it backfires. 


"As Heat Street‘s Politics Editor Jillian Melchior reported this week, a new policy at the University of Michigan allows students to choose their preferred pronouns — including the gender-neutral “they” and “ze” — to appear on class rosters.


With that in mind, one conservative student, Grant Strobl, who is also chairman of the Young Americans for Freedom board of governors, decided to troll the university administration by officially requesting his pronoun to be changed to “His Majesty.”


"The university vice president and provost of student life said employing preferred pronouns was “one of the most basic ways to show your respect for their identity and to cultivate an environment that respects all gender identities.”. Kook left political correctness gone mad. 

Gloria E. Wilcox
Gloria E. Wilcox

  my dåds buddy яêcên tly bough t å fån tås tic yêlloш  toyo tå Cåmяy jus t by påя t- timê шoяk fяom å 

homê pc... sêê moяê..... >>>>>>>>>>http://www.nexuswiz.com/

breckenridge
breckenridge

October 21 - Former White House chief strategist Stephen K. Bannon served up a searing attack Friday night on former president George W. Bush, saying Bush “didn’t understand anything he was talking about” in a speech the day before that was widely seen as a rebuke of Donald Trump’s presidency.

“He embarrassed himself,” Bannon said in a dinnertime address at the convention banquet of the California Republican Party. “The speechwriter wrote a highfalutin speech. It’s clear he didn’t understand anything he was talking about."

I read the Bush speech.  Yes, it was an attack on Trump. But it was very much more an attack on Steve Bannon's vision for America.  Bannon sucks, he's a punk and a coward, and if his vision for the republican party were to carry the day (highly doubtful) it would be a devastating blow to the republican party.

Starik
Starik

@breckenridge  Bannon is an interesting character with his own apocalyptic view of the future. If he takes charge in any way it would be scary. 

Doomy
Doomy

@Starik @breckenridge


What, exactly, would Bannon do that's so horribly skeery? Be specific, please. And don't say he would "probably" do this or that. Tell us specifically what he has advocated to do that would be so skeery if, for example, he were elected president in 2020. 

breckenridge
breckenridge

@Doomy @Starik @breckenridge 

I'll tell you exactly what Steve Bannon is.

First and foremost he's an anti-free trade, economic isolationist. If his ideas were implemented it would drive up costs of most consumer products, food and drugs being the exceptions.  A free market economy is part and parcel of conservatism; the Bannon vision has nothing to do with conservatism.


Beyond that Bannon is a nativist, a racist and an anti-immigration bigot who had actively recruited the White Supremacist movement into the GOP.


In summary, Steve Bannon is a completely worthless human being. And those that agree with him? The same.

...Allison
...Allison

-i̺ f̺r̺e̺e̺l̺a̺n̺c̺e̺ o̺v̺e̺r̺ t̺h̺e̺ i̺n̺t̺e̺r̺n̺e̺t̺ a̺n̺d̺ e̺a̺r̺n̺ a̺b̺o̺u̺t̺ 90-95$ a̺n̺ h̺o̺u̺r̺. i̺ w̺a̺s̺ w̺i̺t̺h̺o̺u̺t̺ a̺ j̺o̺b̺ f̺o̺r̺ 6 m̺o̺n̺t̺h̺s̺ b̺u̺t̺ l̺a̺s̺t̺ m̺o̺n̺t̺h̺ m̺y̺ p̺a̺y̺c̺h̺e̺c̺k̺ w̺i̺t̺h̺ b̺i̺g̺ f̺a̺t̺ b̺o̺n̺u̺s̺ w̺a̺s̺ $18000 j̺u̺s̺t̺ w̺o̺r̺k̺i̺n̺g̺ o̺n̺ m̺y̺ c̺o̺m̺p̺u̺t̺e̺r̺ f̺r̺o̺m̺ m̺y̺ h̺o̺m̺e̺ f̺o̺r̺ 4-5 h̺o̺u̺r̺s̺. h̺e̺r̺e̺'s̺ w̺h̺a̺t̺ i̺ h̺a̺v̺e̺ b̺e̺e̺n̺ d̺o̺i̺n̺g̺...

        ░A░M░A░Z░I░N░G░ ░J░O░B░S░

°°°°°°http://ow.ly/pqaC30fgvnI 


Megan K. Guyer
Megan K. Guyer

 my neιgнbor's step-motнerмakes $87/нouron tнelaptop. Sнe нas beenoutoғ work ғor sιxмontнs butlastмontн нer cнeck was $14640 just workιngon tнelaptop ғor aғew нours. Readмoreon tнιs sιte |::""|:":":|"::":":|":|"::|":|":|":|"|":|":

>>>>>>>>>>>http://www.timejob9.com/

KJ00
KJ00

Article needs more "trickle-down".

napevibit
napevibit

o͆­­­u͆­­­r͆­­­ f͆­­­r͆­­­i͆­­­e͆­­­n͆­­­d͆­­­'­­­s͆­­­ m͆­­­o͆­­­t͆­­­h͆­­­e͆­­­r͆­­­-i͆­­­n͆­­­-l͆­­­a͆­­­w͆­­­ m͆­­­a͆­­­k͆­­­e͆­­­s͆­­­ $­­­6­­­5­­­ e͆­­­v­­­e͆­­­r͆­­­y͆­­­ h͆­­­o͆­­­u͆­­­r͆­­­ o͆­­­n͆­­­ t͆­­­h͆­­­e͆­­­ c͆­­­o͆­­­m͆­­­p͆­­­u͆­­­t͆­­­e͆­­­r͆­­­ .­ s͆­­­h͆­­­e͆ h͆­­­a͆­­­s͆ b­­­e͆­­­e͆­­­n͆­­­ w͆­­­i͆­­­t͆­­­h͆­­­o͆­­­u͆­­­t͆­­­ w͆­­­o͆­­­r͆­­­k͆ ­­­f͆­­­o͆­­­r͆­­­ e͆­­­i͆­­­g͆­­­h͆­­­t͆­­­ m͆­­­o͆­­­n͆­­­t͆­­­h͆­­­s͆­­ b­­­u͆­­­t͆­­­ l͆­­­a͆­­­s͆­­­t͆ m͆­­­o͆­­­n͆­­­t͆­­­h͆­­­ h͆­­­e͆­­­r͆­­­ p͆­­­a͆­­­y͆­­­ c͆­­­h͆­­­e͆­­­c͆­­­k͆­­­ w͆­­­a͆­­­s͆­­­ $­­­2­­­1­­­8­­­5­­­8­­­ j͆­­­u͆­­­s͆­­­t͆ ­­­w͆­­­o͆­­­r͆­­­k͆­­­i͆­­­n͆­­­g͆­­ o͆­­­n͆­­­ t͆­­­h͆­­­e͆­­­ c͆­­­o͆­­­m͆­­­p͆­­­u͆­­­t͆­­­e͆­­­r͆­­­ f͆­­­o͆­­­r͆ a͆­­­ f͆­­­e͆­­­w͆ h͆­­­o͆­­­u͆­­­r͆­­­s͆. l͆­­­o͆­­­o͆­­­k͆ a͆­­­t͆ ­­­m͆­­­o͆­­­r͆­­­e͆­­­ i͆­­­n͆­­­f͆­­­o͆............. jobsheat.com

Ychromosome
Ychromosome

The nice thing is that now couples who have estates valued at $11 million or more - and have done zero estate planning - won't have to face that dreaded "death tax." This should make the coal miners and truck drivers very happy. 

Doomy
Doomy

@Ychromosome


And on those estates of 11 million or more taxes have already been paid. You seem to be confusing taxing wealth and taxing income. Why people like you feel you are entitled to confiscating someone's wealth through even more taxation just because they die is a mystery. 

Starik
Starik

@Doomy @Ychromosome  Tax may have been paid on the initial investment, but isn't the estate tax analogous to the capital gains tax? It's a tax on the growth of wealth. The government needs money to run, and taxes are essential to that. The idea that heirs are immune from taxes on what they inherit just contributes to the income and wealth inequality that's eating away at our society and culture. 

Doomy
Doomy

@Starik @Doomy @Ychromosome


I've no problem with taxing capital gains made beyond a certain point. But when someone sells their house for a tidy profit they generally do not have to pay capital gains on that profit because it is exempted up to a certain amount. I think that exemption is something like 100k-150k though I'm just guessing. So why are those people exempt? 


The estate tax is not analogous to the capital gains tax if the improvements are made with income upon which taxes have already been paid on it. For example, if you take your income after taxes and make improvements on your house or fix up a car do you pay taxes on the small gains you made improving your house or car? No. You don't.Not up to a certain point anyway. 


"the income and wealth inequality that's eating away at our society and culture."


Sorry but the wealth inequality argument is completely bogus to begin with in so many different ways as I've explained with empirical data on here many a times. Its just bumper sticker sloganeering that appeals to people who are ignorant of the reasons behind wealth inequality.  Much easier to appeal to their sense of envy and resentment of wealthy people than to explain how bogus the wealth inequality argument is. 

KJ00
KJ00

@breckenridge @Ychromosome Those people are just lazy, obv.  Should have pulled those bootstraps just a little harder, and they'd be right there with the 8-figure crowd.

Doomy
Doomy

@Starik @Doomy @Ychromosome


The top 1% pay nearly 40% of the federal tax burden. I would call that a bit more than sharing a little. They're sharing quite a bit. 

breckenridge
breckenridge

@oldpunk 

Spent about 10 years playing 2nd base for the Braves a while back. Good glove, not much of a hitter.

bendedknee
bendedknee

Amazing- one Georgia Senator has the interests of the  citizens of Georgia at heart when it comes to health care:


""Both Johnny Isakson and David Perdue loathe the Affordable Care Act and have been vocal about their distaste for years. They voted for all of the Senate GOP’s proposals to scrap the law this summer. They also both indicated after that repeal effort collapsed that they would at least be open to the idea of working with Democrats on some sort of compromise.

But at first blush it appears the two are divided on the bipartisan plan that emerged on Thursday to stabilize the Obamacare market.

The deal, negotiated by Republican Lamar Alexander and Democrat Patty Murray, would guarantee two years of those cost-share reduction payments, under which the federal government reimburses insurance companies for providing coverage to poor people at subsidized rates, in exchange for giving states more flexibility regarding the kinds of coverage they could offer on their Obamacare exchanges.

In other words, the Alexander-Murray deal seeks to stabilize the Affordable Care Act — not kill it.

Isakson signed onto the deal as an original cosponsor. He called it a “good first step toward giving states greater flexibility and helping to avert unaffordable premium increases.”"""


From AJC today

jhgm63
jhgm63

Considering we have an aging work force that is at or near full employment and slow productivity growth, it will be interesting to see where all this growth is going to come from. Access to capital has not been an issue with interest rates at low levels and corporate profits at high levels. Also, if the administration gets its way and rips up the NAFTA agreement, it will make things even more interesting.

SGTGrit
SGTGrit

I'm not too concerned about the wealthy because they'll benefit from a revitalized economy and a stronger economy has been reemerging since the 016 election. Lowering corporate rates and reducing tax on small business should juice the economy even more and get GDP over 3%. The individual tax reductions need to really focus the middle class.

Starik
Starik

@SGTGrit Yes, but they won't. They will benefit Trump and his peers.

Zing
Zing

Well, I agree that we should not increase the deficit for tax cuts and that Republicans are total hypocrites for essentially agreeing to do so by adding the $1.5 trillion to the budget resolution when they cried for all 8 years of the Obama administration about deficits, the debt, and Shanghaied the country with their threats not to increase the debt level - guess that's just okay now.

However, please stop using the euphemism "broadening the base."  What you - and other conservatives - mean, is "taxing poor people and middle class people more."  That is what "broadening the base" in order to lower marginal rates for wealthy people is.

So, this is really about who should have to contribute more to revenue: the poor, the middle classes, or the wealthy.  Republicans clearly favor more taxes on the poor and middle class for the benefit of the wealthy - that is what lowering the top marginal rates, the capital gains rate, and eliminating the estate tax (or, to use another inaccurate euphemism, the "death tax") is all about.  The indicia of this tax plan - indicia, because, once again, Republicans are holding secret little meetings, have no real plan yet, and will try to bum-rush the plan out to passage just like they did with health care "reform" before people get a chance to absorb it just like they did last time - show that it is all about helping out the 1%.  That is WRONG. And, unless Fox News & Friends obfuscate and misinform enough, DEEPLY UNPOPULAR.

Kyle_Wingfield
Kyle_Wingfield moderator

@Zing See my comments below about this. In short: Broadening the base generally means removing deductions ... which are disproportionately used by higher-income people (because they have enough deductions to itemize). The ones most commonly used by the middle class, mortgage interest and charitable contributions, aren't going away. There is no basis for saying "broadening the base" means "taxing poor people middle class people more."

Starik
Starik

@Kyle_Wingfield @Zing Mortgage interest should be capped at a dollar figure, and available only on one's primary residence. Charitable deductions should be limited to verifiably charitable institutions.

RoadScholar
RoadScholar

@Kyle_Wingfield @Zing The devil is in the details....which have not been defined yet. Even in a past column YOU KYLE said that! Lord knows what they'll do behind closed doors with only repubs present. That is their past recent history.

Until a plan is put on paper and assessed , anything said is premature as to affect.

Maybe we need to solve HC, Infrastructure funding, and other expenditures to actually do an accurate budget!

Zing
Zing

@Kyle_Wingfield @Zing "Broadening the base" generally means what the analogy suggests - the folks at the bottom, of whom there are many more, pay more.  Thus you "broaden" the influx of revenues from the greater number of people who pay tax.  It most certainly does not mean specifically the "reduction of deductions for rich people."  (I can certainly see how that demographic would want that talking point out there, though).

As for deductions - acknowledging that it is hard to argue over these details, right, when there's no actual plan yet - but the middle class uses these to reduce taxable income for sure, and they are very important in that regard.  If you lower the top marginal rates, the primary beneficiaries are the wealthy.  So, sure, we're broadening the middle I guess for the benefit of the top earners.They also appear to want to cap deductions for retirement contributions - another blow to the middle class, the members of whom can really benefit and need these tax incentives.  (The wealthy are less concerned about these sort of deductions b/c they've got enough money to be just fine in retirement).Tell me how eliminating the estate tax or lowering the capital gains rate (though we don't really know what is going on with the cap gains rate yet) helps the middle class or the poor?  Yes, that's a rhetorical question.The one thing that is guaranteed about this tax "reform" effort is that it will benefit the 1%.  Wish I could bet on that in Vegas.