Tuesday, October 25, 2011

Perry’s Tax Plan — Run Flat

Rick Perry has put out his plan for fixing the tax system. Kevin Drum takes a look.

…Perry is going to lower the corporate tax rate, move to a territorial tax system, pass a Balanced Budget Amendment, ban earmarks, freeze federal hiring and salaries through 2020, halt all pending federal regulations, repeal Obamacare and Dodd-Frank, repeal section 404 of Sarbanes-Oxley, and add private accounts to Social Security (presumably without paying for them, per normal Republican doctrine)

I’m disappointed. Perry only wants to repeal section 404 of Sarbanes-Oxley? Why not the whole enchilada? What a sellout.

What can you even say about this? It sounds less like a tax plan than a big ol’ stew pot of right-wing applause lines, all the way up to the inane insistence that eliminating the estate tax has nothing to do with rich people and is only designed to provide “needed certainty to American family farms and small businesses.” Should we laugh or cry? Perry has actually managed to combine two separate conservative memes (the estate tax is all about family farms, uncertainty is hobbling the economy) into one single sentence that makes even less sense than either of them separately. It’s hard not to be impressed.

The result will be a massive tax cut for the rich and a huge loss of revenue for the federal government, which is a Republican’s dream: America in the age of William McKinley.

Last night on one of the cable shows (probably Hardball), I heard some Republican praising the idea of Perry’s plan and the flat tax, comparing it favorably to how they did it in Eastern Europe. Really? A Republican praising a foreign country’s tax system? Aside from the fact that most countries that use a flat tax rate have a large number of social programs like universal healthcare and all sorts of safety nets, most of those Eastern European countries have a population equal to a small state or large metropolitan area here in the U.S. And what works on a small scale may not work on a large one. That’s the right-wing argument about Romney’s healthcare reform in Massachusetts vs. Obamacare.

But hey, if the GOP wants to emulate European socialism in order to fix the system, let’s give it a try. Just be aware that a lot of those countries wish they had our system of loopholes, dodges, and credits that give us about the lowest tax rate in the industrialized world.