The idea that some very rich people pay a smaller share of their income in federal taxes than many in the middle class strikes most Americans as unfair. But you wouldn’t know it around here. While there’s some variation, many in the DC chin-stroking, gum-flapping, chin-music-making class have been quite critical (and yes, I’ve stroked the chin and flapped the gums with the best of them).
Dana Milbank at the WaPo judges the rule to be a campaign gimmick. Art Laffer plays the class warfare card at the WSJ. And the scholars at Tax Vox call it “a terrible idea,” arguing that “…imposing a minimum tax of any kind is an admission of policy failure. If the president thinks the rich don’t pay enough, he ought to restructure the tax code so they do, not stick on yet another Band-Aid.”
OK, these critics have some points. Yes, Dana, there’s politics in here—shocking, I know. But far too often, when someone proposes a fix to something wrong in the tax code, the punditry reacts with palpable dismay—it’s not comprehensive, 86-style reform! It’s not a flat tax! It doesn’t lower the rates and broaden the base! It’s not a VAT! Quick, pass me the vapors before I swoon!
First of all, tax reform is over-rated. There, I said it.
What is “tax reform” anyway? For some it’s having just one rate, for others it’s a national sales tax, and for most it’s trading off lower rates for a broader base. For all, it’s simplifying the current system (for me, it’s ending favorable treatment of one kind of income over another).
Worthy ideas, I’m sure. But answer me this: with 98% of House Republicans having signed the Norquist pledge, is this the moment to oppose a simple measure that corrects some of the problems that plague the current code? Comprehensive reform requires compromise, and that’s off the table. I’m pretty sure that if you tried to “lower the rates, broaden the base” right now, you’d get a lot more of the former than you would of the latter. There were numerous R candidates in the primary campaign who proposed flat taxes. Remember how they scored?
I know—the Buffett rule’s not going anywhere either. Nothing is. But why should that preclude the fight to add some progressivity, some fairness, back into the code…to try to do something short of comprehensive reform that would amplify and address the problem of low effective rates among some of the very wealthy, a problem that’s exacerbating our serious inequality problem?
The fact that we need a Buffett rule may well be “admission of policy failure”—if so, then I admit it! And I think we should fix it ASAP. So put aside the vapors, my fellow pundits, as let us step into the breach as one!
Update: FWIW, the people diverge from the DC punditry on this one: