My latest article’s up at the Star Ledger’s New Jersey Voices.
Kevin Hassett discusses at Bloomberg
For those of you wondering what the details of taxing the rich to pay for Democratic spending proposals might look like, Rangel, a close ally of Hillary Clinton, has provided a tour of the abyss. If the “mother of all reforms,” as he calls his tax plan, had a name, it would be Mrs. Bates. But, unlike Norman’s mother in the Alfred Hitchcock classic “Psycho,” this lady is very much alive.
In terms of revenue, Rangel’s reform would be the biggest tax increase in history. Compared to a baseline where President George W. Bush’s tax cuts are extended and the dreaded alternative minimum tax isn’t allowed to swallow millions of taxpayers whole, the bill raises taxes by a whopping $3.5 trillion over the next 10 years, according to the office of Representative Jim McCrery of Louisiana, the top Republican on the Ways and Means Committee.
To put that in perspective, that’s about $2 trillion more than the 10-year cost of the Bush tax cuts enacted back in 2001.
But the revenue grab isn’t the scariest part. That honor belongs to the increase in marginal tax rates, which is almost unfathomable in its scale. Rangel’s main objective is to repeal the alternative minimum tax, which was originally designed to capture taxes from wealthy individuals but over the years has taken in more and more middle-income families.
48% Tax Rate
To accomplish that, and still collect the AMT revenue, he would enact a surtax on the adjusted gross incomes of wealthy taxpayers. If your family’s income is above $200,000, then your surtax is 4 percent. If it’s above $500,000, it’s 4.6 percent.
But the tax increase on the wealthy doesn’t stop there. When the Bush tax cuts expire in 2010, the top marginal rate goes back to 39.6 percent. In addition, Rangel would restore the phase-out of itemized deductions and personal exemptions that was repealed in Bush’s 2001 bill.
The accountants’ lobby must have been knocking at Rangel’s door.
Tom Blumer was saying,
This is why you will almost never, if ever, hear the Charlie Rangel/Hillary Clinton crowd, whom I am tentatively naming “Team Chillary” (in honor of what they will do to the economy if they get their way), actually say that they want to raise the highest federal bracket to 39% or so with their MOAT, and then to 44% or so if the tax system in place since 2003 otherwise goes back to where it was in 2000 (this is usually referred to as “repealing the Bush tax cuts,” but should be seen as a big tax increase over what we’ve been used to now for many years). Instead they speak of tiny-sounding 4% surtaxes and the like.
As the old psychiatrist said to Carmela, “You’ve been told. Now you can’t say nobody warned you.”
ore from Betsy.
My article’s up at the Star Ledger.
In today’s Blog Talk Radio, my guest will be Dr. John Fleming
John V. Fleming graduated from the University of the South (Sewanee) in 1958. He then went for three years as a Rhodes Scholar to Oxford (Arkansas and Jesus College), where he took a honors BA in English. He spent two years at Princeton getting a Ph.D. (1963), before becoming an Instructor in English at the University of Wisconsin (1963-65). He has taught at Princeton since 1965. He is the former chair of the English Department, the former Master of Wilson College, and the current Faculty Director of the Program in Freshman Seminars. Jointly appointed in the Department of Comparative Literature, Fleming has published very extensively in the fields of medieval English and European literature, medieval art history, and the history of Christian thought and spirituality. He is a winner of the Behrman Award for Distinguished Achievement in the Humanities and the President’s medal for distinguished teaching. Last spring he received the Phi Beta Kappa Teaching Award. He serves on numerous editorial boards and national committees, and he is a past President of the Medieval Academy of America.
Dr. Fleming is a great guy who has inspired generations of students. Please join us!
The call-in number is (646) 652-2639
My Blog Talk Radio guest next week will be Michael Fumento, who has a new article, Afghanistan may be called “The Forgotten War” but we’d better hurry up and remember it, for time is short.
Iranians outraged by ‘300’ movie, but not by the destruction of Persian antiquities by their own home-grown mullahs.
The Republican Study Commitee will launch the American Taxpayer Bill of Rights
Today at a capitol press conference at 10AM. Read my report of yesterday’s blogger call
Deja-vu all over again, Clinton: Vast Right-Wing Conspiracy is Back
Sudan sued over USS Cole attack
Families of American sailors killed in the suicide bombing of the USS Cole warship are suing the government of Sudan, accusing it of aiding terrorism.
They claim the African nation helped al-Qaeda, which was blamed for the attack, and are seeking damages of more than $100m through a Virginia court.
In a lighter mode,
Dreamland: Prague is the new Prague
Greta celebrates Pi day
Neo-neocon has a wonderful homage, Dance me to Leonard Cohen
Casino Royale is out on DVD:
This afternoon I had the opportunity to participate in a bloggers’ conference call with Congressmen John Campbell of California and Republican Study Committee Chairman Jeb Hensarling TX.
Congresswoman Marsha Blackburn also participated briefly.
Ms Blackburn introduced the American Taxpayer Bill of Rights, which has four basic principles and aims to “restore fiscal sanity”.
John Campbell explained 4 broad principles of the American Taxpayers Bill of Rights: People have a right
1. To a government that doesn’t spend more money that they can pay, ” a right to a federal government that does not grow beyond their ability to pay for it”. A limit on government spending.
2. That Social Security is spent only for Social Security. The surplus should be held and spent only on Social Security.
3. To a fair and simple tax code by January 1, 2011, which is when the current tax code expires.
4. To see that the Federal budget is balanced every year, without having their taxes raised. They are working towards a balanced budget constitutional ammendment that would require a super majority vote of 2/3 to raise taxes.
Jeb Henserling: House conservatives believe that “it’s critical that we put the focus on taxpayers” in order to
Eric from Red State: Point #2 on Social Security sounds a lot like Al Gore’s lockbox, so what are that odds that that would happen now?
John: Yes there are some similarities, but we do believe that Social Security should be less like a transfer program and more like a government-assisted savings and retirement program. Where we would like it to go would be a lot different from Gore’s. SS should be about you saving for you, and it’s not spent on other than Social Security.
Jeb: We have a platform where House conservatives will be introducing legislation. The Republican conference is smaller but there are a larger number of conservatives that would introduce personal-account legislation. “The purpose is to move Soc.S. from a debt-based system to an investment-based system so the goverment doesn’t spend it on something else.”
Rob Bluey, Heritage Foundation, How about the Republican leaders, are going to get behind what you’re talking about?
Jeb: Conservatives get it. “Most of our members get it, that the nation wants Republicans to be Republicans, and limited government, smarter government, effective government, is part of our core values, and that brand has been tarnished”. Democrats poll better than some Republicans and our leadership has invited us to bring forth ideas and legislative initiative…We have to focus on the kind of nation we want to leave the next generation.
John: People looking for the nomination for president want to have conservatives, and should pay attention.
John Cambpell’s started a blog,The Green Eye Shade (since he’s also a CPA) to keep people informed of “what is being ground out at the sausage factory”.
NZ Bear, Porkbusters, a suggestion, on transparency: the right of taxpayers to know where the money is being spent, and who’s spending it:
John: There a lot of fiscal ideas not included, earmarks, line-item vetoes, but these four are basic principles, and these other ideas would fit under this umbrella.
Jeb: Not unlike building a house, there are four corners to it. Unless we do something about the culture of spending you can’t reform the budget. “Earmarks are a huge portion of the culture of spending”.
John: And transparency shouldn’t just be limited to earmarks.
James Joyner, Outside the Beltway, has skepticism about this sudden change of course, now that you are in the minority, how can you get a budget amendment passed?
Jeb: The Republican conference is smaller but the conservative group is larger. We have a couple of choices: do nothing, or tell the American people that we understand that accountability and smaller government is a core value of the Republican party. Nothing like an election debacle to focus the mind. We want people to know there’s a strong vocal group that care about these issues.
John: There’s no question that Republicans in Washington lost their way in the past year but we need to stand up and say “this is where we have to go”. “We worked very hard to make sure there’s a stigma attached to raising taxes”. If we can do this things we can make a significant change that can last.
Jeb: There may not be many opportunities to legislate, but there will be plenty of opportunities to communicate what kind of nation we’ll have if government spending is not controlled.
Bruce McQain of Q&O, on the fair and simple tax code, any specifics?
John: We propose to subset the existing tax code to start to get serious discussion, becaused what we got needs to be replaced, and what with.
Jeb: There’s almost unanimity that the present system is rotten, and makes us uncompetitive with the rest of the world. What we hope to do is to reignite the falt tax/fair tax debate.
Bruce: How to you reach the critical mass for this to happen?
John: There is a critical mass to replace the current system.
Jeb: We’re here to talk about core principles of our party, and you’re part of a solution. You guys in the blogosphere can reach a lot of people. This hit a high water mark once, and there was a time when the nation was educated on this and you can help on this as part of the solution.
My question was on the Constitutional amendment for a balanced budget: What kind of time frame are you looking at, and what kind of objections do you forsee?
John: Contitutional amendments don’t come along every day and are not easy to do. The obvious reason for it in 34 out of the last 38 years there has been no balanced budget, so if everybody says they’re for a balanced budget, why not be for an amendment? The argument against is that we won’t be providing the services that people need. Most people see the government smaller, less spending, and a balanced budget.
Jeb: Jefferson wanted to add an amendment to prevent the government’s ability to borrow money. If the American people had to pay for all the government they have they’d choose less borrowing and more opportunity.
The last question, from Ragnar Danneskjold of Jawa Report, was, how do we keep this dialogue going? Who to contact?
Jeb Through the presidential candidates, and by encouraging all House conservatives to bring different pieces of legislation so they continue to educate and sensitize the Amer people to the crushing load that awaits us if we don’t extend these four basic rights to the American people.
Propaganda in the news:
Voice of America or voice of Ahmadinejad?
After a Senate subcommittee hearing last summer in which an escaped Iranian dissident testified that the U.S. itself has been beaming anti-American propaganda into Iran, Sen. Tom Coburn began looking into the problem. Today, in a polite but searing letter, addressed to President Bush, Coburn spelled out his concerns that American broadcasts into Iran, via Radio Farda and Voice of America, freighted with content that sounds like the propaganda of Tehran itself, “may actually be harming American interests rather than helping.”
political and media activists attempt to stigmatize anyone who doesn’t pay homage to their “scientific consensus.”
Here are the facts as we’ve been able to collect them. AEI doesn’t lobby, didn’t offer money to scientists to question global warming, and the money it did pay for climate research didn’t come from Exxon.
Speaking of “climate change”, The Economist
The other part of the report’s job is to make predictions about what will happen to the climate. In this, it illustrates a curious aspect of the science of climate change. Studying the climate reveals new, little-understood, mechanisms: as temperatures warm, they set off feedback effects that may increase, or decrease, warming. So, as understanding grows, predictions may become less, rather than more, certain. Thus the IPCC’s range of predictions of the rise in the temperature by 2100 has increased from 1.4-5.8°C in the 2001 report to 1.1-6.4°C in this report.
That the IPCC should end up with a range that vast is not surprising given the climate’s complexity. But it does leave plenty of scope for argument about whether it is worth trying to do anything about climate change.
As far as global warming goes, send me some. It’s been below 30F for an entire week here and I need to shed the Polartec and the tweeds.
When You Tax Profits, You Tax People (emphasis added)
The prevailing 35 percent corporate tax rate takes a monster bite from all U.S. businesses. Moreover, our business taxes are far too high in relation to the rest of the world. Believe it or not,the corporate tax rate is lower in France than it is in the United States.
Along with slow-growing Japan, the U.S. has the highest marginal tax rate on corporate profits of any of the developed countries. Think of this: Germany is cutting its corporate tax rate to 15 percent from 25 percent. And if frontrunner Nicolas Sarkozy wins the French presidential election this spring, he plans to slash France’s corporate tax burden. Meanwhile, we’ll still be taking our best companies behind the barn and shooting them.
The bottom line here is that our economic system is all about free-market capitalism, and at the core of that system is profit. Profit isn’t a dirty word. From profits spring the abundance of this great country. Profits are the mother’s milk of stocks and the economy. Expanding profits provide businesses the resources to enlarge production operations and hire additional workers. This, in turn, is how incomes are created, wages that are then spent by American families.
Why can’t liberals grasp this?
Because it won’t fit their script?
Imagining a Triangulator-in-Chief: Hillary Rodham Clinton
P.J. O’Rourke recently said Hillary’s “Hugo Chavez in a pants suit.” Should Hillary wear skirts? Donatella thinks
They make her look too masculine
In Hillary’s mind, “and that is wrong because?”
She’ll have to lose a few pounds and wear shorter jackets, to look better in skirts. This is what she looked like in a skirt years ago.
In a lighter mode,
Affairs to Forget. How Hollywood lost its romantic groove.
Here’s my second-favorite movie,
They don’t make them as they used to, don’t they?
asks The Wall Street Journal (by subscription; emphasis added)
The idea of financing state services without an income tax is hardly radical. Nine states today – Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennesse, Texas, Washington, and Wyoming – manage well without them. With a few exceptions, the non-income tax states are America’s most prosperous. Meanwhile, the high income states, which tend to be congregated in the North East, keep surrendering jobs, people, and voters to the South and West.
State lawmakers also seem to have learned from two of the most recent states to adopt an income tax: New Jersey and Connecticut. As recently as 1965 New Jersey had neither an income nor sales tax, but managed to balance the budget every year. Now it has both taxes – its income tax is the 5th highest in the nation –
And let’s not even think of the highest property taxes and school taxes, too,
but the state is facing what Stateline.org calls a “staggering budget deficit.” Allied Van Lines reports that the Garden State is one of the leading places for people to flee.
I first started this blog out of frustration with NJ taxes. While my frustration hasn’t diminished, I’ve become so fed up of the subject that I’m posting about it because The Husband asked that I do.
The National Center for Policy Analysis has more on the “ferocious competition to attract jobs and businesses” among the states.
New Jersey is entirely out of the competition.
Update In the comments section, Francis Porretto recommends Robert Higgs’s excellent book, Crisis and Leviathan
I read this book several years ago and I highly recommend it to anyone interested in fiscal policy, economics, or how their hard-earned money is spent by the politicians.