BTB: Republicans Dumb Plan to Reinflate the Housing Bubble
Excellent article over at Doug Mataconis’ blog . Money quote is here:
I do not think a Swiss-cheese tax code that rigs the market to send investment dollars here rather than there
thousands of times over is a tax code worth defending.
If Americans for Tax Reform believes otherwise — and I don’t know that they do — then it amounts to a conservative embrace of state-directed social and economic engineering.
I am swiftly discovering myself to become more and more of a “fair taxer” or flat taxer as time develops… I haven’t quite sorted out this regressive tax problem in the back of my mind, but the idea that “every American should be invested in their government” (or something to that effect) struck a nerve.
Now I just have to mentally sort out how you don’t regressively impact low income families with a flat tax… if that’s even desirable. When taxes are too high, the solution should be to lower them, not to steal from others to balance the books in a progressive schematic. Low income wage earners feeling the burn of a 25% tax rate ought to scream bloody murder… and demand lower taxes, which in turn puts more money into the economy, creates better jobs, and pulls people out of poverty.
I dunno. Any defenders of a progressive tax scheme here to correct my malinformed opinions? Or have I just turned the corner on the flat tax?
- Posted by Shaun Kenney at 12:03 pm
- Permalink for this entry
- Filed under: Virginia Politics
- RSS comments feed of this entry
- TrackBack URI
The truth is that all tax deductions and tax credits — whether it’s for mortgage interest, chartable deductions, or anything else — end up distorting the economy in some way. If the tax code were truly limited to it’s intended purpose of raising revenue, it would be a flat tax with no deductions.
Politically, I have no illusions, though. There are far too many people whose interests are tied up in the existing system for it to be changed significantly. On the mortgage interest deduction alone you’ve got homeowners, the real estate industry, homebuilders and contractors, and anyone remotely tied to the housing industry who would fight tooth and nail to keep the deduction.
Absent a major crisis, we’re never going to see the kind of change we really ought to see.
I think that if you look at the model that Easter Europe adopted after their 60 year experiment with Socialism/Communism, its pretty good evidence that the flat/ fair / consumption tax is the way to go. The ecomomies of Poland and other former Soviet Sattelites are doing pretty well under flater/ fairer tax systems.. I for one am partial to the consumption tax. However we go, the first step is to find and support candidates that have the political ” huttspa” to run on this platform. The change will be like pulling off a really sticky band- aid, painful, but ooohhh so worth it.
I’ve written about ATR’s position on this question below:
http://www.atr.org/mortgage-interest-deduction-andbr-taxpayer-protection-a3059