Oppel and experts fail: Now that Perry has proposed a tax plan, the plan will be scored by the Tax Policy Center. A sane discussion will ensue among those who want such a trinket.
But the New York Times has floundered and flailed in its run-up to this event. Yesterday, Richard Oppel massively failed in this news report. No, it doesn’t exactly “matter”—although as the dumbness piles up, the broader discussion can get very dumb. But this is the dumbest part of Oppel’s hapless report: ht
OPPEL (10/24/11): Independent analysts say it is hard to imagine a flat-tax plan that would not be very regressive compared with the current system. Right now, the highest tax rate for many middle-income earners is 15 percent, while the richest Americans are subject to a 35 percent rate on much of their income.That is really dumb.
“If you’re going to get the same amount of revenue, someone has to pay the price,” said Roberton Williams, a senior fellow at the nonpartisan Tax Policy Center, a joint venture of the Urban Institute and the Brookings Institution. “The rich pay less, the poor pay nothing, and the middle class bears the burden.”
As we noted a few days ago, it is supremely easy “to imagine a flat-tax plan that would not be very regressive compared with the current system.” It simply requires a high tax rate with a high exemption. (All the major Republican plans have included substantial exemptions.) For example: Institute a single tax rate of 40 percent, with an exemption of $150,000 for a family of four. Or maybe $250,000! With a tax rate of 60 percent!
Under such a plan, the highest earners would pay much more. Mid-level earners would pay much less. No Republican would ever propose such a plan, of course. But that isn’t what Oppel was saying—even though he should be saying that, so his readers will be exposed to the logic of these Republican plans.
Duh. If it’s "simplicity" the GOP craves, they can get it with a high single rate. But the GOP isn’t seeking simplicity. The GOP is actually seeking lower tax rates on the rich! Oppel should open his big fat yap and let the public hear that.
Are you kidding? It’s easy to imagine a “flat tax” (single-rate) plan which would be hugely progressive as compared with the current system. That said:
Why can’t Williams imagine such a plan? You know how it can be with these experts!
Why can’t Oppel imagine such a plan! People! He works for the Times!
Quite honestly I have never viewed the current tax brackets as all that unflat especially when you factor in all the exemptions, deductions and preferred tax rates on certain kinds of income. We quibble about progressivity and what it means, and it can mean a lot of different things. But nobody seems to disagree, at least not publicly, with the underlying principle of progressivity, that the rich should pay more in taxes than the poor, that in some way or another taxes should be assessed on the basis of quantity of income or wealth, not on a per capita basis, one in which everyone would pay the same dollar amount.
ReplyDeleteI'm disgusted with Republican plans that would cut current tax revenue, when these plans have no explanation of how the federal government can live on reduced revenue, especially since we're already running annual deficits of $1 to $2 trillion. I'm equally disgusted at Democratic plans for increased spending, when they have no idea of how to fund the increased spending while dealing with the annual deficit and the huge $15 trillion debt. I wish we could elect some responsible adults.
ReplyDeleteTwo different rates, zero and 40% or whatever, do not make a flat tax.
ReplyDeleteThe GOP tax schemes enrich the rich, will gut the social safety net, will reduce services that we all depend on and will be a disaster for the middle class and the poor. Guys like Forbes, the Kochs, Pete Peterson, Dick Armey, Norquist and the Waltons will reap a financial windfall from the GOP tax cons. Oh wait, did I dare criticize millionaires and billionaires, that means that I am jealous of them, I am envious of them. Bad me, bad me. (sarcasm off). According to certain people on this web site, if you dare criticize rich people, then you are just a jealous jerk. At what point am I allowed to hold a fascist clown like Steve Forbes accountable for his pompous tax scam. People like Forbes pretty much want to reduce the rest of us to serfs and peons because they would eliminate Social Security, Medicare, Medicaid, the minimum wage and all unions. They want to take us back to a gilded age when the robber barons ruled with impunity and could befoul the land without being held to account.
ReplyDeleteHey, Anonymous, if you ever get out my way, let me take you on a tour of Stanford University, founded by Robber Baron Leland Stanford. It's hardly befouled. On the contrary, it's quite beautiful. And, of course, it provides a home for outstanding education and research.
ReplyDeleteA constant rate with a large exemption would not truly be a "flat" tax since the effective rates of taxation would vary. You have simply produced a progressive tax with a single rate.
ReplyDeleteThe problem is that when you raise the rates you can exempt more taxpayers (voters). So it will eventually produce very high rates on very few people.
I think a plan with an 80% rate, for earnings and capital gains, with exemptions up to $100,000 per person in a family, should be the standard. The corporate tax rate should be 20%, with steep penalties for shipping jobs overseas, tax avoidance, compensation more than 50x what the lowest paid person in the corporation makes, and so on. That would really put revenues back in the coffers, give corporations the "tax break" they're always whining about, and restore clarity to those ranting and raving about "confidence."
ReplyDelete