Monday, April 25, 2005

Social Security Part IV: The Flat Tax

Not content to exhaust what little political capital the President had coming out of the 2004 elections, it appears the White House political operation is ready to move onto the next issue that will galvanize Democrats and encourage moderates to vote Democratic in 2006.

Apparently the WH feels it hasn't wasted enough capital on its doomed and floundering Social Security privatization, Terri Schiavo, and judicial filibusters. They are now ready to launch yet another effort that is near and dear to conservative hearts. The institution of the flat tax.

Yes, the flat tax, it's not just for doomed billionaire candidates anymore. It's now going to be government policy.

I am skeptical when this White House talks about "simplifying" the tax code that they are really taking about reform like we saw Sen. Bill Bradley and Sen. Bob Dole do in the 1980s. Just as personal=private and constitutional=nuclear, "simplifying" means only one thing-- a flat regressive national sales tax.

Of course, they are correct that there are multiple tax breaks for education. I've always taken the Lifetime Earning Credit because it lets me, as the President says, "keep more of my own money." But since this is a highly popular Clinton tax break, I bet the WH will get rid of it and keep the less effective tuition deduction.

What's almost comical is this quote: "But the proliferation of tax breaks end up costing the public because they mean lawmakers cannot lower income tax rates, Steuerle said.
'They make it look like smaller government, when in fact it's actually bigger government," he said.'"

That's right, tax credits and deductions are big government programs that prevent good hearted Republicans from being able to cut the tax rate even lower. Massive across-the-board tax cuts didn't cause an explosion in government and deficits, my $1,200 Lifetime Earning Credit did.

So any Democrat thinking about opposing the President's flat tax proposal is on notice. To oppose this means you are somehow for higher taxes, bigger government, protecting a confusing and volumeous tax code, and not balancing the budget.

That's be funny if I didn't honestly believe it to be true. This Administration has no shame. Hopefully, Democrats will take the offensive on this as they did with Social Security and point out that the Republicans plan to reduce the deficit by raising taxes of lower and middle income families and college students.

Personally, the more the Democrats take on the fiscal conservative, pro-targeted tax cut mantra, the better off we'll be. That's another debate the Democrats can win in the election.

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