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DEL.ICIO.USTax proposal tests GOP’s reformist zeal
The Atlanta Journal-Constitution
The army of alphabet-soup interest groups marshalled to oppose vouchers for special needs children was sandlot football compared to the army that will gather to oppose any serious effort to overhaul Georgia’s tax structure.
The alphabet-soup armies, most funded directly or indirectly by taxpayers, consisted largely of groups protecting their public school turf. That conservatives succeeded despite the odds is a career achievement for state Sen. Eric Johnson (R-Savannah), the voucher bill’s sponsor, and for House and Senate leaders. The victory was a decade or more in the making.
Comes now tax reform, the Big Idea being advanced by House Speaker Glenn Richardson (R-Hiram) and other House leaders. As proposed, most state and local taxes would be eliminated, replaced by an income tax and a value-added tax of 5.75 percent. Among those targeted for elimination are all property taxes, local sales taxes, and taxes derived from motor fuels, insurance premiums, workers’ compensation, estate, business and occupation taxes, intangible and utility taxes, among others.
The state would collect a flat 5.75 percent income tax — the top rate now is 6 percent — and a 5.75 percent value-added levy that is added in to the cost of goods and services. The state sales tax now is 4 percent, but local levies push that up. Tops in the state is the City of Atlanta in Fulton at 8 percent.
To achieve the flat rate, income tax deductions would be limited to charitable contributions, mortgage interest, Social Security and unemployment benefits, tax-exempt income and rental payments for a primary residence. The value-added tax is similar to a sales tax, but it’s built into the cost of goods and services. Businesses would pay based on total sales, minus depreciation, bad debts, charitable contributions, and most goods and services purchased. Revenues collected by the state would be divvied up to local governments.
Without question it is the biggest of the Big Ideas to come from the Gold Dome in our lifetimes. It’s a legacy idea. Bold. So daring that the very suggestion that such comprehensive legislation will be considered draws legions of hand-wringing critics who fear that its simplicity and transparency will crimp politicians’ ability to creep levies higher. With two primary levies, an increase will be a much-publicized debate.
Should Georgia switch? It’s far too premature to decide. The debate has not yet begun. Nothing legislators attempt approaches tax reform in degree of difficulty. Not only is every perceived advantage in the tax code protected by special interests, but Georgia is developing a vocal cadre of liberal advocates for higher public spending to grow social programs. And, of course, local governments are likely to join the opposition, since the tax revision being proposed would take away their authority to levy most taxes.
Tax revision on this scale really is not an idea that should emanate from individual legislators — and not because they lack the expertise or standing, but because explaining it requires an enormous marketing effort using the media, civic clubs, chambers of commerce, business and social networks, tax experts and individual legislators.
Without the governor and lieutenant governor leading the charge, or at least actively involved, the prospect of so much change at once is so frightening to so many that the armies of the status quo will destroy the outgunned reformers before they decamp. Under the state constitution, tax legislation has to originate in the House, but that does not preclude the governor or lieutenant governor from embracing tax simplification or reform as part of the conservative agenda. Of course, the governor and House leaders could also have embraced a flexible cap on spending — the resolution offered by state Sen. Chip Rogers (R-Woodstock) and passed on a bipartisan basis in the Senate — and neither has.
It’s been remarkable how quickly this new conservative majority has grown dysfunctional. Big Ideas fall to individual legislators, who maneuver them through by their own wit, skill and drive. Man, we could have gotten this under the Democrats.
If the top leadership is incapable of putting forth and rallying around something, anything, that provides evidence that it matters at all that the party of fiscal and social conservatives is charting the course, this revolution will be over before it strikes its course.
Tax reform may not be the right Big Idea — but at least it is something.
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By Jim's a Cherry Picker
May 8, 2007 8:26 AM | Link to this
Good Morning Jim,
I know off topic, but a great example of the way business is done. I wish I could bribe some members of the Ga Legislature to sling some perks my way. Too bad I’m just a normal working stiff:
ANCHORAGE, Alaska (AP) — The founder of a multinational oil services company and one of his top executives have admitted to illegally paying more than $400,000 to Alaska lawmakers in a widening political corruption scandal.
Bill J. Allen, chief executive of Anchorage-based VECO Corp., and Rick Smith, a vice president, pleaded guilty Monday to bribing state legislators with cash and the promise of jobs and favors for their backing on bills supported by the company.
Allen, 70, and Smith, 62, appeared separately in U.S. District Court to plead guilty to extortion, bribery and conspiracy to impede the Internal Revenue Service.
The pleas came days after the indictment of one current and two former Republican members of the Alaska House of Representatives on federal bribery and extortion charges related to last year’s negotiations for a new oil and gas tax and a proposed natural gas pipeline that would have benefited VECO.
By Politics Aside
May 8, 2007 8:37 AM | Link to this
The difference between a tax reformer and a liberal advocate? The liberal advocate is the one who spills alphabet-soup at a legislative session. The tax reformer is the one he spills it on.By DebbieDoRight
May 8, 2007 8:46 AM | Link to this
Flat rate, Flat rate, Flat rate….OMG you sound like a broken record!!! Why is it always the RICH (and anyone who can spend 4-5 weeks in South America on vacation and not be in the Peace Corps, or WHO is rich), hollering about tax cuts specifically targeted FOR the rich? What about talking about getting rid of some of these ridiculous state taxes? How about talking about how to fund Peachcare? Let’s talk about helping the poor children of Georgia instead of a bunch of rich fat cats? There’s a great column you could write!
By Curious Observer
May 8, 2007 8:49 AM | Link to this
The devil is in the details of this “big idea,” of course. It’s impossible to conclude much about it without some understanding of what the income floor is for the state and value added taxes. Will all people, regardless of income level, pay the same rate? If so, the “big idea” is horribly regressive; lower-income people will be hit with the same rate as the highest income individuals in the state, while the latter will see their property holdings go tax-exempt. If not, at what level will income earners begin to pay the flat rate, and will there be any mechanism for VAT refunds for the lowest income earners among us?
Either way, the “big idea” is most definitely unRepublican in at least one sense: it seems to centralize all income collection and distribution at the state level, while removing the power at the local level to levy taxes. Precisely how is this power grab in line with the Republican interest in pushing decision-making down to the local level? Or does this interest yield whenever the Republican interest in lowering taxes gets involved?
I could see some good coming from a properly crafted tax bill. For instance, those residents of Fulton and DeKalb counties, crushed by high property taxes because the state has foisted the funding of Grady Hospital off to them, might at last see some relief. But I would like to see some details about the “big idea” before I pass judgment.
My skepticism is fueled in part by a lifetime’s observation that a taxing authority almost never changes its taxing system without ensuring that the new system will yield even more largesse for rewarding friends and punishing enemies. Show me the money before you start gushing about the big idea.
By jbmlaw
May 8, 2007 8:51 AM | Link to this
Good morning all. Tax reform is generally a great idea, but I’m certain Speaker Richardson’s plan would not be my first choice. It may be the best possible until we educate our leftists. Cleaning out the various exemptions and deductions would help minimize the market disruption caused by various legislators’ tax preferences. Better yet, of course, would be elimination of the income tax entirely, and exclusively relying on a sales tax or value-added tax. That would eliminate the state’s damage to the capital base (investible funds), and would cause the state’s biggest spenders to pay the biggest bills.
By Van
May 8, 2007 9:12 AM | Link to this
Depending on the bottom limit of the flat portion of the tax, it could give tax relief to many.
Since everyone that works and earns over $7000 a year is paying the 6% tax rate, reducing it to 5.75% would allow people to keep a little bit more of their wages. Exemptions for primary residence would be my only choice for a deduction.
The VAT I am not sure about. Yes, the folks that buy higher end items would pay more, but we are leaving it up to business’ to be the tax collecting agencies. As a sales tax, it might be more attractive.
By Dennis
May 8, 2007 9:28 AM | Link to this
By DebbieDoRight May 8, 2007 8:46 AM | “Flat rate, Flat rate, Flat rate….OMG you sound like a broken record!!! Why is it always the RICH (and anyone who can spend 4-5 weeks in South America on vacation and not be in the Peace Corps, or WHO is rich), hollering about tax cuts specifically targeted FOR the rich?”
Mr. Wooten either isn’t capable of seeing that, or else, he doesn’t give a damn.
You don’t have to be a blind conservative not to see it, just an ignorant one to deny it.
By Van
May 8, 2007 9:38 AM | Link to this
Dennis and DebbieDoRight -
It targets the RICH? $7,001(6% tax bracket) a year makes you part of the rich? You would make more than that working at the Quicky-Mart gas station selling slopies.
By Jack
May 8, 2007 9:38 AM | Link to this
I agree with JBMlaw. The local media is touting this as the “Fair Tax”. Obviously they didn’t read Boortz’s book. The real fair tax eliminates the income tax. Typical media spin.
By Jill
May 8, 2007 9:55 AM | Link to this
I agree with Jack, but I vehemently disagree with JBMlaw, however I agree with boortz, not having read his book, unfair taxes are best but only if they are taxes on unspent income, as I see fit for my tax advantage over you, and who cares?
Tax the untaxable. Otherwise we’re finished. Why cant anyone see that? Why doesn’t somebody do something? what are you all, tin bloggers?
THE GOP’s mission: to boldly tax where no tax has levied before. The Klingon death-tax system is fairer than the new fair tax proposal.
Engage.
By Redneck Convert
May 8, 2007 9:56 AM | Link to this
I am going to wait till I see what this Richardson guy is going to do about the high taxes on Skoal, Redman, and PBR before I decide weather I like his big idea. A can of Skoal costs 4 bucks now. What is a good GA redneck going to live on if he has to pay that kind of money on a nessessity? Here we got all the pantywaste libruls ready to jump on good Christian people just because they like to do a little chewing and drinking and I don’t see this Richardson wanting to do anything about it.
Anyway, I’m all for a Flat Tax. Stomp that sucker so flat it don’t even exist no more. I’m tired of paying for Those People and other people having sex on my dime and librul social projects and all that stuff. Just let me keep my money in my cement vault at the trailer and stop trying to take it away from me.
I hope you all pardon me for being a little cranky this AM. Its time for my monthly bath and I don’t like it. But all good GA rednecks got to do it oncet in a while. Its the Christian thing to do.
By Aquagirl
May 8, 2007 9:56 AM | Link to this
I say clean out the morgage interest deduction too. Why encourage people to owe money? Encourage them to invest, not owe on their residence.
One thing I haven’t heard much of…if we go with a sales tax only, it could encourage a large black market. Otherwise, it’s a great idea.
By Jack
May 8, 2007 9:59 AM | Link to this
Wanna go up a hill and fetch a pail of water? :)
By Jack
May 8, 2007 10:22 AM | Link to this
I’m sick of seeing Hanoi Jane’s face on AJC.com. Makes me want to hurl.
By PiedmontPark
May 8, 2007 10:26 AM | Link to this
I have alot of mixed feelings about this idea. On one hand it would save me $4,000 per year and it would save my parents significantly more per year in property taxes alone.
However, the problem with this proposal, is that it effectively centralizes goverment control under the Gold Dome and makes the local goverement dependant upon the whims of the legislators. Doing this will effectively render local goverment powerless to perform the tasks required, such as maintain the city and county roads (this is not done with money from the state DOT), local parks, etc. This proposal would also serve to lessen accountability of goverment to the population. Local goverement officals tend to be more responsive and accountable to the residents of the citys and counties. Also, redistribution of tax money from high income/high population areas of the state to more rural areas of the state would occur.
By aqg
May 8, 2007 10:33 AM | Link to this
every person should pay the same amount of taxes no matter their income. an individual should not be penilized just becasue they are better off than others. if someone buys a more expensive item then by default they are paying more in taxes. the bill sounds good but until both the federal and state tax system are repealed and replaced with a fair tax we are all being screwed!!!!!!!!
By Jack
May 8, 2007 10:43 AM | Link to this
I especialy liked it when those who paid no income tax at all got a $400.00 check from Uncle Sam as a “tax refund” Don’t recall the left complaining about that.
By jm
May 8, 2007 10:46 AM | Link to this
tax revision is a great idea but at the end of the day, the amount of revenue received will still have to meet the obligations set forth by the government. Which means in any tax reform, unless government outlays (services) are cut, the government will still need to generate the same revenue (taxes). With that in mind, if someone benefits from the tax reform, someone else will be worse off. Unless of course, you want to run a deficit like the federal government has been wont to.
By Jill
May 8, 2007 10:48 AM | Link to this
Taxes dont make for very fun blogging. Are taxes really necessary? Most taxes exist because one or two lawmakers made them happen.
Dont seem righteous.
By jbmlaw
May 8, 2007 10:49 AM | Link to this
Dear Jill @ 9:55, yours will easily be the best post on the subject, I yield to genius. You must be PoFo’s sister.
Dear Dennis @ 9:28 and Debbie @ 8:46, I am with Van. You are both kleptocrats, who claim you don’t understand why the victims don’t want their pockets picked. We don’t owe you a reason.
Dear Curious @ 8:49 and Aquagirl @ 9:56, your critique (of constraints on the local tax authority) is totally valid, and my failure to catch that flaw reflects adversely on me. Our freedom is best preserved by allowing each tax authority full freedom to test the market. Some will tax too high and permanently alienate their best “customers,” whereas others will make themselves attractive to the best potential customers (taxpayers.) The free market among tax authorities will push rates down overall, just as we see in competition among states vying for new industry.
By Lane
May 8, 2007 10:56 AM | Link to this
Just jumping in quickly to point out that anytime we read a columnist dismissing opponents in a debate by referring to them as “alphabet-soup armies”, then we know that this columnist is either too lazy, too stupid or too dishonest to directly address the actual arguments (as opposed to straw-man arguments) coming from the other side.
By JK
May 8, 2007 10:56 AM | Link to this
Here’s an idea: raise everyone’s taxes and pay policemen, firefighters, and teachers a decent living wage. Up the standards for admission to these professions, and make it worth the effort. The people who b-tch and whine about their tax burden (but who can still afford cushy vacations from their gated communities) are the first to complain when their Jag hits a pothole in the neighborhood. My area of town is always being repaved, while parts of south Atlanta still have dirt roads! (Saw it in the AJC). When you need a cop, you need one NOW. If the paramedics take more than 3 minutes to get to your accident, you’ll sue somebody. And you want to wage a never-ending war, far away, burning up our resources so we can swagger like John Wayne, brag about the size of our ‘nads, while accomplishing nothing? That cost MONEY (unless you like owing trillions to the Chinese — feel free to talk about THAT one all day, okay?)
Whatever happened to, “This is the best country in the world! Support it!” Cheapskates & Tightwads: Wear your labels proudly.
By Jack
May 8, 2007 11:15 AM | Link to this
JK. Amen to that.
By Van
May 8, 2007 11:35 AM | Link to this
Any overhaul of the tax system has to be coupled with a review of spending.
While neither party has a good track record at controlling spending, a new tax system is worthless unless spending is brought under control.
If the new tax system brings in more revenue, then someone is going to try to spend it.
While spending is not per se bad, it does need to be controlled better than it has been in the past.
By Jack
May 8, 2007 11:39 AM | Link to this
History repeats itself. The current crop of politicians should go back and read what happened when there was taxation without representation.
By Jack
May 8, 2007 11:50 AM | Link to this
Big brother may get angry with me so I’m outta here for the day. Have a Happy.
By Van
May 8, 2007 12:01 PM | Link to this
JK,
Gee, I wish I could afford a vacation like that. I have worked for this firm for 35 years and get 5 weeks vacation, but I can not afford a trip like that. The best I can do is a 4 day weekend. It must be nice to live in your world JK.
Sarcasm aside, JK, your class envy is showing. Some of us put in 50-60 hours a week, salaried not hourly paid, and do get sometime for vacation. However, the lavish vacation pictures you paint only appear in the Penthouse Forum letters.
By Jill
May 8, 2007 12:02 PM | Link to this
I think we should introduce to the Georgia Legislature a new, very fair, and very small tax measure I’d like to call “the Stamp Act”, (copyright)……
By getalife
May 8, 2007 12:06 PM | Link to this
28 so far this month
By Dennis
May 8, 2007 12:12 PM | Link to this
By jbmlaw May 8, 2007 10:49 AM | “Dear Dennis @ 9:28 and Debbie @ 8:46, I am with Van. You are both kleptocrats, who claim you don’t understand why the victims don’t want their pockets picked. We don’t owe you a reason.”
May I suggest that both you and Van go back and really READ what Debbie and I said.
As far as your, “We don’t owe you a reason.”, I have two thoughts; 1)it’s always interesting how some people are always jumping about tax reform - as though they have as much as the top one percent of the nation to lose by tax reform, 2)as much time as you spend on here, one can wonder why (and just how little time) a “victim” like you spends on practicing law and not climbing up to that top one percent.
You don’t have to be a blind conservative not to see it, just an ignorant one to deny it.By Lane May 8, 2007 10:56 AM “Just jumping in quickly to point out that anytime we read a columnist dismissing opponents in a debate by referring to them as “alphabet-soup armies”, then we know that this columnist is either too lazy, too stupid or too dishonest to directly address the actual arguments (as opposed to straw-man arguments) coming from the other side.”
Mr. Wooten either isn’t capable of seeing that, or else, he doesn’t give a damn.
You don’t have to be a blind conservative not to see it, just an ignorant one to deny it.
By DebbieDoRight
May 8, 2007 12:18 PM | Link to this
I especialy liked it when those who paid no income tax at all got a $400.00 check from Uncle Sam as a “tax refund”
Quick question, who were the “those” and can you back that statement up with some “facts”?
By DebbieDoRight
May 8, 2007 12:20 PM | Link to this
Dear jbmlaw at 10:49 — Isn’t there an ambulance you should be chasing?
By shady grady
May 8, 2007 12:23 PM | Link to this
Tax and punish success, reward apathy and envy. Punish those who work 50 plus hours a week in an office, and reward those who complain about having to work at all. That’ll teach France we can do it better than them. That’s not a successful recipe for the future of this nation, socialist dems.
By Shannon
May 8, 2007 12:26 PM | Link to this
The “Big Idea” is regressive. Ultimately, low-income workers would pay a larger percentage of their incomes in state taxes than middle class workers and middle class workers would pay a larger percentage of their incomes than upper class households. In short, relative to your household income, the less you can afford, the more you pay.
In addition to being outrageously stupid, the “Big Idea” is seriously immoral. What kind of people would shift most of the tax burden to those who can afford it least? Georgia “Christians”, I suppose.
By DawgBite
May 8, 2007 12:26 PM | Link to this
By Jack
May 8, 2007 10:22 AM | Link to this
I’m sick of seeing Hanoi Jane’s face on AJC.com. Makes me want to hurl.
Who gives a rat’s patoot what you’re sick of Jack? I’d rather see her any day than that snarling Cheney piece of dog excrement.
By Aquagirl
May 8, 2007 12:29 PM | Link to this
jbmlaw is as entitled to his paycheck (whatever ambulance chasing pays) as the grocery bagger at Publix. “Rich” people want tax cuts. So do “Poor” people, why is it not selfish when they want to keep their money?
By Sylvia
May 8, 2007 12:29 PM | Link to this
Look, Wooten’s job is to stir the pot and get a reaction from both sides. If you call him names, and respond with emotional vigor, he wins.
He usually wins. Does it have to be a war? Every single day the same group of die hards start spitting, trying not to sound identical?
Just relax, and riff a little. Taxes is Taxes. So what? The rich get richer and the poor get taxed. The poor live, pay taxes and die. The rich live, avoid taxes, and never die, (notice? I’ve never read an obit about a rich person, they’re all poor taxpayers, and the obit is always written to sound like the 1040EZ form.
Jim Doe died today owing $1,435.23 in back taxes. He leaves behind two dependents, and was married, but always filed separately, the fool. He qualified for the Earned Income Credit in 2002. His hobbies were who cares, we want our money.
By Van
May 8, 2007 12:30 PM | Link to this
Shannon,
In Georgia, if you have an adjusted gross income over $7000 a year, you pay 6% taxes.
Where is the inequality in this if we lower it to 5.75%
By JK
May 8, 2007 12:31 PM | Link to this
Van, Thanks for getting personal, but you know nothing of my work or economic class. (I used to work for big blue, but saw the way souls were sucked from living human beings year after year, and moved on.) There are things I envy, to be sure, (Mrs. Jack for one) but that’s not pertinent to this discussion. (I get five weeks, too, but was referencing someone else’s reference to Mr. Wooten’s foreign travels, not the Penthouse Forum, which clearly you read, but I do not.)
I agree with your statement, “Any overhaul of the tax system has to be coupled with a review of spending.” Amen to that! You’ll never hear me claim that money collected by the government isn’t wasted and squandered. Taxation and spending are two sides to the same coin. Considering them as separate issues, as is done by dishonest politicians and hack columnists as a political ploy, is a big part of the problem, IMO. I also think it’s a conservative value to FIX something that’s broken instead of trashing it for being “unnecessary” because it’s not something I personally need. Silly me; I think other people matter too.
By Sylvia
May 8, 2007 12:40 PM | Link to this
I think the new proposed tax system is cruel and unwarranted.
By Van
May 8, 2007 12:40 PM | Link to this
JK,
When a tax code is so riddled with loopholes and special exemptions, you have to start over from scratch.
Fixing a broken down old junk car is not going to give you any relief. Throw it out and start from the beginning again.
As an afterthought, big blue isn’t that bad, unless you let them get to you.
By Sylvia
May 8, 2007 12:48 PM | Link to this
I had an uncle who lived in Taxes.
I think he lived in Dollars, Taxes.
Not far from Bush’s ranch in Wacko, Taxes.
By Shannon
May 8, 2007 12:55 PM | Link to this
Van at 12:30,
By concentrating on the income tax portion of state taxes, you miss the big picture. When you look at all state taxes combined (including both income and* sales) the current state tax structure is already regressive and the so-called “Big Idea” will make it even more regressive. To accomplish this goal the Bad Idea would reduce the income tax rate and increase the sales tax rate. We should be moving in the other direction.
By getalife
May 8, 2007 1:23 PM | Link to this
This is for the Pope
By Van
May 8, 2007 1:59 PM | Link to this
Shannon,
For the working stiff, it looks like an even trade. The replacement of the current sales tax, especially in the poorer areas of Atlanta(8%), this would certainly help them.
“Among those targeted for elimination are all property taxes, local sales taxes, and taxes derived from motor fuels, insurance premiums, workers’ compensation, estate, business and occupation taxes, intangible and utility taxes, among others.”
By jbmlaw
May 8, 2007 2:09 PM | Link to this
Dear Shannon @ 12:55, by ignoring the total effects of any income tax, you miss the big picture. All income taxes damage an economy, for reasons observed by Adam Smith. All income is used in one of two ways: (1) consumption, and (2) savings. The “savings” portion of income becomes the next generation’s investible funds, the capital that funds all society growth. When an indiscriminate “income” tax is levied, the damage is inflicted equally on both consumption and savings. While the consumption tax leads directly to less extravagant current living, any tax on capital damages all future growth.
Capital formation rate explains the poor economic performance of the socialist economies of the world (Britain in the 1970s, France from 1980- today, Scandinavia from 1950-1995, Ireland until 1995, the Soviet Bloc countries until they escaped communism, Germany from 1995 - 2005) and the explosive growth of the comparatively untaxed (China and India since 2000, Ireland and Estonia since 1995, and Hong Kong, Taipei, Singapore forever.)
By rarringt
May 8, 2007 2:53 PM | Link to this
Good afternoon, all.
Jbm, I forgot your claim of sleeping with a copy of “The Wealth of Nations” under your pillow. :^)
That model appears to (ironically) be contingent on a more or less equitable allocation of resources. We know that this defies a basic tenet of pure capitalism, in which incentive drives production and thus creation of wealth.
Unfortunately, this is not a world where equitable allocation is a high priority on the individual level. Funds gained inequitably and compounded through intergenerational transfer are what creates and sustains the aristocracy, and let’s face it, one Paris Hilton is more than enough.
In order to ensure a (theoretically) equitable distribution (i.e., roads, first responders, schools, the military, “Brownie,” etc…), governments impose taxes.
Such taxes, properly used, lay the groundwork for the infrastructure necessary to encourage further growth and development. After all, producing the World’s Greatest Widget means little if you don’t have a road to get it to market.
By jbmlaw
May 8, 2007 3:06 PM | Link to this
Dear rarringt @ 2:53, I salute an honest post; your affirmation that class-envy is the intellectual foundation for all taxes (“In order to ensure a (theoretically) equitable distribution”) is breathtakingly rare. I doubt that such an acknowledgement is likely from your political leaders - that does not play well in Peoria - but you say what we conservatives have always believed.
By rarringt
May 8, 2007 3:18 PM | Link to this
Hmm, interesting that you pulled “class envy” out of your bag of conservative nuggets.
I didn’t think I alluded to a rich vs. poor argument. Actually I think (being the authority on my own thoughts) I said that taxes benefit the entire society through the provision of infrastructure necessary to make capitalism (or any socio-economic construct) viable from a practical perspective. After all, Bill Gates drives on the same roads as John Doe.
Sorry if I’m a bit too pragmatic for your flights of theoretical fancy. But then again, you don’t really need a road to fly, do you? :^)
How goes the practice?
By Political Mongrel
May 8, 2007 3:35 PM | Link to this
A Big Idea is not necessarily a Good Idea. Localities know where their needs are better than the state, and this idea requires localities to come begging hat-in-hand to the state for money that they can provide and control better locally. From a local standpoint, this is a Big Bad Idea.
Second, there is no new “conservative majority”. The Georgia Legislature has always been conservative throughout its history. A small, vocal, and largely ineffective minority of liberals did not keep it from being conservative overall. The current majority is just wedded to some of the more regressive and loony ideas of the Republican party and neoconservatism, an unrealistic and failed movement if there ever was one. Bring back real conservatism, not this cheap and selfish scam.
By DT
May 8, 2007 3:42 PM | Link to this
Maybe I should just take out a loan and start paying off some politicians that way.
Because Jim, in this crazy, mixed up world, (you gotta pay to play)[http://blogs.abcnews.com/theblotter/2007/05/18biggop_dono.html].
Know what I’m sayin’?
I wanna be a playa dangit! I need some cash so I can start greasing up some palms G!
By DT
May 8, 2007 3:46 PM | Link to this
Dang,
I got the formatting backwerds:
text to be linked
By JK
May 8, 2007 3:52 PM | Link to this
I am also calling BS on the “class envy” nugget. Not everyone worships money to the same degree, just as not everyone worships God in the same way, and not everyone worships food or sex with the same zeal. It’s hard for some to understand that not all joy comes from sitting on a big pile of “mine! mine! mine!” Some find joy in the simpler, less-material pleasures of life. Of these people, the money worshippers often exhibit what we call “P-E-NIS ENVY.” That is all.
By Shannon
May 8, 2007 4:06 PM | Link to this
jbmlaw at 2:09,
You might be interested to know that Adam Smith is essentially the father of progressive taxation. In Book Five of the Wealth of Nations, he wrote, “It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion.”
Yes, savings are important to our economy. However, savings are not more important than consumption, as your argument implies. Our economy can only benefit from savings when there is also consumption.
In addition, not everybody has the means to save, and of course, the higher a person’s income, the greater his or her ability to save. Overtaxing consumption to benefit savings (as you look at it) forces higher taxes, relative to income, on those who can least afford it to save (if they can save at all) and offers lower taxes to those who can most afford to save.
You’re correct that capital formation (i.e. savings) is essential to economic growth. However, you’re incorrect when you assert that income taxes interfere with capital formation — overtaxing consumption while shrinking the middle class interferes with capital formation.
You also seriously oversimplify when you pick selected countries during selected periods of time. For example, to say that China (a communist country) and India are rapidly growing simply because they have lower tax rates (or no taxes) on income than the U.S. (essentially the same tax structure we’ve had during the decades we grew to become the economic super power) lacks credibility. We all know that there are many factors at play (including the ability, in many developing countries, to pollute and exploit with impunity).
Van at 1:59,
The Bad Idea is not an even trade. The working stiff would get stiffed even more than he or she already is. I wholeheartedly agree that we need to simplify our tax code, but in this case, the prescription is worse than the disease.
By JB
May 8, 2007 4:20 PM | Link to this
Here’s an excerpt from Jay Bookman’s comments on this subject. Wait to you read about the stupidity in paragraphs six and seven below:
“HR 900 [the “Big Idea”] would eliminate all state and local property taxes, all motor fuel taxes and all local special-use sales taxes such as those that fund MARTA. They would be replaced by two statewide taxes: a flat-rate income tax of 5.75 percent; and a single statewide value-added tax, a form of sales tax, also of 5.75 percent.
[House Speaker] Richardson touts his plan as the handiwork of economist Arthur Laffer, the “father of supply-side economics,” and Donna Arduin, a partner in Laffer’s consulting business. He also claims that his proposal would touch off an economic boom in Georgia and become “the talk of the nation,” a statement that suggests that the speaker may have been suckered into seeing himself as some sort of visionary.
The faddish, almost purely ideological nature of Richardson’s idea becomes all too apparent once you look into its details … the Richardson proposal would constitute an immense shift in tax burden from businesses and more prosperous property owners onto the poor and middle classes. And if it were ever implemented, it would create huge nightmares.
Under HR 900, all local governments in Georgia — cities, counties, school districts, etc. — would be stripped of their power to levy taxes. Local communities and elected officials would no longer have the authority to decide for themselves how much to spend.
Local control, in other words, would vanish, and power would be centralized under the Gold Dome in Atlanta. It’s a little startling to think that this is what conservative Republicanism has come to in Georgia, but there it is.
The budget for each local government would be permanently established at its share of state and local revenue in 2006. If Gwinnett County, for example, spent the equivalent of 1 percent of all state and local revenue in 2006, it would still be getting 1 percent of state revenue in 2016 and 2026.
If Gwinnett were to grow twice as fast as the rest of the state by 2016, it wouldn’t matter — its share of state revenue would still be frozen. And since that formula would be part of the state constitution, changing it would be remarkably difficult.
It’s hard to believe that Richardson paid someone good hard cash to produce such nonsense.”
http://www.ajc.com/opinion/content/opinion/stories/2007/05/06/0507edbookman.html
By Curious Observer
May 8, 2007 4:32 PM | Link to this
Well, you have to admit that Richardson has paid someone to come up with a remarkably effective way of settling political scores, while at the same time feathering the nests of his wealthiest contributors. Can you imagine MARTA officials, hats in hand, going to the Golden Dome to ask for funding? Or Shirley Franklin having to beg the Glenn Richardsons of the legislature for funds to operate the city of Atlanta?
Oh, and Shannon and JK, don’t bother trying to refute the neocons such as jbmlaw and Van. For them, it’s all about keeping every penny they earn and contributing nothing to support the social structure. They are basically modern anarchists. Logic will do nothing to cool their ardor for an economic jungle in which the strong dominate and the weak die.
By Killin' Time
May 8, 2007 4:51 PM | Link to this
CO,
If Shannon and JK doesn’t pursuade jbmlaw and Van, maybe they’ll pursuade someone else who comes along to read the debate (there might be some who read this blog without actually contributing). They might also provide arguments that others might consider when thinking about these issues or when discussing them with others.
So, I think it’s a good idea to answer the Vans and jbmlaws of the blog — even when their minds are made up. Fortunately, that isn’t true for everyone.