Just cut taxes?

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Having lost the House, the Senate, and the Presidency, most on the left simply want to obstruct government, slow things down, and keep from talking about big issues like the economy, tax reform, and health care. Six months into the Trump presidency, I’d stay they are doing a good job, and the corporate wing of the Republican party doesn’t seem too concerned about it. Twice I’ve heard their pundits argue that “with healthcare and all of the other issues on the table, reforming the tax code is just too complicated in the current environment, so Trump should just go for a simple tax cut.” To this I say absolutely not.

There’s no question middle and upper income Americans are overtaxed. An across-the-board cut would help, but the real problem is cronyism embedded deep in the tax code. Corporate leaders benefit from the complexity of the code, moving their money around to minimize their tax obligations. Individuals do the same thing. There’s nothing wrong with playing by the rules of the game, but it’s time to change the rules.

In a word, this means simplification. It’s neither moral nor productive to create artificially high tax rates, and then offer “deductions” or “tax credits” to businesses or individuals willing to spend as Washington directs. These tax incentives encourage us to spend our money in ways we otherwise would not; if this were not true, then the incentives wouldn’t be necessary. For individuals, this includes putting solar panels on your roof, buying an electric car, or taking out a mortgage. Engaging in these activities lower our taxes nd pass the burden on to our neighbors.

But there are winners in the current system, manufacturers of solar panels, electric cars, home builders, and real estate agents to name a few. Industry groups seek refuge in the tax system and would be happy to see President Trump give up on tax reform in favor of “just cutting taxes.” The reform threatens the benefits they receive from the current system. Productivity is the key to real economic growth, and we are most productive when our decisions are guided by what we believe is in our best interest, not what government has prodded us to do. This is why tax cuts alone are not sufficient. We need real tax reform.

4 Comments

4 Comments

  1. darrell  •  Jun 28, 2017 @11:54 AM

    not sure i agree, half a glass is better than no glass

  2. rick_v  •  Jun 28, 2017 @12:36 PM

    please, republicans, please, reform the tax code. talk is not enough. you have the white house, senate and the house. get it done!

  3. LarryG  •  Jun 28, 2017 @1:01 PM

    Just heard you on Wilkow Majority. Awesome!

  4. Arthur W.  •  Jun 30, 2017 @6:52 AM

    The biggest carve out is the 45% who pay no income taxes. Real reform cannot happen until everyone pays something. This is representation without taxation. If half the people pay nothing, then it’s not their money we’re spending, so what do they care how it’s spent? But you will never hear politicians on either side talk about the untaxed.