Coburn argues tax simplification would
raise revenue through higher growth,
not increased tax rates.
Washington Post:
The Republican Party once had a home for the thinking of Tom Coburn, Mike Crapo and Saxby Chambliss. But that party is long gone.
The three U.S. senators banded together a few months ago in support of higher tax revenue as a means of balancing the federal budget. Even with drastic spending cuts, they concluded, Washington could not vanquish its soaring $14.3 trillion debt without additional income.
The implication here is that these senators have embraced higher taxes as part of a long-term debt plan, but the reality is that none of these senators has been willing to make that case—at least not in public—and none of them has actually voted for tax hikes. In fact, all of them are strong supporters of extending the Bush tax cuts.
Nonetheless, they do believe that we need more revenue to achieve fiscal responsibility—but they aren't proposing to accomplish this by raising taxes. Here's how Tom Coburn described their thinking in mid-April:
MR. GREGORY: Could you support a deal here, out of this Gang of Six, on the budget that includes tax increases?
SEN. COBURN: Well, we're not talking about it. I think if you go back and look at the commission's report, what we were talking about is getting significant dynamic effects by taking away tax credits, lowering the tax rate and having an economic increase that will actually increase the revenues to the federal government. We're not talking about raising tax rates at all. So if, if there's a net effect of tax revenue that would be fine with me. I experienced that during Reagan's period in 1986.
Coburn's argument was that simplifying the tax code—eliminating tax credits and loopholes while lowering the overall rate—will generate additional revenue without raising overall tax rates because it will lead to more economic growth. That argument is straight out of Republican voodoo economics orthodoxy; arguing that it represents some sort of heterodoxy is absurd.
Sure, it raised the hackles of Grover Norquist, because Norquist opposes eliminating tax credits and loopholes, but it doesn't mean Republicans in the Gang of Six were actually willing to support tax increases. Perhaps in private discussions Coburn and the others have acknowledged that we need to move taxes back to where they were in the 1990s, but in public, they haven't been willing to make that case. And until and unless they do, they shouldn't be credited with taking a reasonable position on revenues.