Herman Cain's 9-9-9 plan is clearly just a gimmick with a catchy title. Why not 8-11-10, or 9-7-15? I find Cain a likable guy; he has a sense of humor, unlike most right wingers. (He hasn't been laughing much lately, however.) However, I am skeptical that we can base a sound tax plan on numerology, but that's just me. Rick Perry (not so likable) has picked up the flat tax banner, mostly in response to Cain. (After last night he'll likely disappear.) My concern is that the Republicans are stealing the tax issue. So far, we Democrats have allowed them to do just that.
This is the very first time I have used the phrase "we Democrats"; it was a defining moment. I am just a newbie here, but I know that most--make that all--Kossacks could do better than Cain or Perry. I want to help if I can. Let's collaborate here at DKos to devise a model tax system to counter the regressive ideas being touted on the right. I have thoughts on the subject; I know you do too. I know damn well we can do better, but if we say nothing, they will come off as the only voice for tax reform. So, what would you propose as elements an ideal tax system?
How many of you would propose our present system? (For shame if you raised your hand.) The individual income tax accounts for about 50% of federal revenue, and the payroll tax another 37%. Corporate taxes come to almost 10% of the total, while excise, estate, and gift taxes barely come to 3%. Should we start with an income tax code consisting of a gazillion words that costs the nation hundreds of billions of dollars to plan for and comply with every year? Should we have a variety of federal excise taxes on a variety of goods and services, ranging from alcoholic beverages to tanning salons. (Yes, tanning salons!) Should we add regressive payroll taxes to the mix, in order to soak the poor? We could--and will--tackle state and local taxes, but let's start with the elephant in the room: our federal tax structure. Frankly, it's just awful.
But it could be worse. 9-9-9 would be worse. A flat tax would be worse. A national sales tax like FairTax would be worse. All of these are being proposed on the right, and all would shift the tax burden toward the poor and away from the rich. Standing pat with what we have is not a good option. We should be in favor of something better or the right will run us over, just like GWB did during his first term.
What criteria should we employ in devising a sound system? The Massachusetts Budget and Policy Center suggests the following criteria: fairness, adequacy, simplicity, efficiency, and stability. This is recommended reading.
The biggest source of federal revenue is our individual income tax, and that is perhaps where we should start. How does it rate on these five criteria? What are its faults and virtues? How can we improve it? Should it be scrapped? If so, what do we replace it with? If we keep it, how can it be made reliably progressive? How do we prevent Congress from tinkering with it? Congress is not good at tinkering.
I will do whatever it takes to keep this project alive; I'm retired, I have the time, and I have the zeal of the recently converted. I envision a process where we settle points of controversy with a debate and perhaps a series of polls in order arrive at our model system. The idea is to propose a complete and coherent tax system as an alternative to both the present system and the Republican proposals.
Republicans could win the next election, and if they succeed in installing their tax ideas, we are in for a very bad time indeed. Their policies have brought us to the brink of depression; we need less of those policies, not more.
A final note on the mechanics of this project: I suggest that the project be known as Project Omaha (an arbitrary code name). If you publish a diary intended to contribute to the project or to criticize it, please put the word Omaha somewhere in the title. If and when we succeed in fashioning a coherent tax system, we will choose a descriptive name that reflects its content.