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Taxpayer bill of rights
Posted by: McQ on Wednesday, March 14, 2007

Today at 10am the Republican Study Committee will introduce a Tax Payers Bill of Rights with the aim of getting bi-partisan support for the principles of such a bill of rights and incorporating them in future legislation. The principles are:
1 Taxpayers have a right to have a federal government that does not grow beyond their ability to pay for it.
2 Taxpayers have a right to receive back each dollar that they entrust to the government for their retirement.
3 Taxpayers have a right to expect the government to balance the budget without having their taxes raised.
4 Taxpayers have a right to a simple, fair tax code that they can understand.
The first principle essentially indexes any increases in government spending to an increase in something like a median income increase for the nation. We get a 3% increase in income, Congress can spend 3% more. Frankly I'd prefer they be tied to something less. There isn't any doubt that they'd justify taking the full amount of whatever that increase was, statistically, as license to increase their spending. I'd prefer they'd be limited to half of that instead. But I do think some sort of indexing is a good idea.

The second principle addresses Social Security. Essentially the RSC is saying that Social Security taxation should indeed actually be in a lock-box rather than in the general fund. It is the first step, I believe, toward ensuring a way to make such a program more of a retirement program than a pyramid scheme. Obviously I'd prefer to see it fully privatized. Even partial privatization would mean people would have more for retirement than they now realize through the program. I also believe people should be given the opportunity to opt out of that program. But those are obviously more libertarian than Republican ideas. Says the RSC:
The simple fact is, should we do nothing, the government will begin to pay out more in Social Security benefits than it collects in payroll taxes. Eventually the system will be bankrupt. That is unacceptable. Taxpayers have the right to receive back each and EVERY dollar that they entrust to the government for their retirement.
Separating Social Security funds and then growing them, along with privatization of at least a part of the system will go a long way toward solvency and at least getting back what was taxed during a person's working life. Grandfather those in under the old system and insure their benefits. Draw a line on the calendar and begin the new system with the younger generations. And do it soon.

The third principle says balance the budget without tax increases. What that means is cuts in spending. And what that further means is less government intrusion, and, at least theoretically, more responsible government. The RSC wants a Constitutional amendment to require a balanced budget and they also want a super majority to pass any new taxes. I'm not sure about their ability to get a constitutional amendment passed, however they do need something with legal teeth to enforce the requirement. I'm frankly all for the super majority requirement to increase taxes.

Last but not least, the RSC want to see a "simple and fair" tax code. I'm not sure what is meant by "fair" since that is such a loaded term any more, but I second the desire for 'simple'. One of the things they want to do is abolish the IRS by January 1st of 2011. That date was picked because that is when all the tax cuts sunset.

I asked the representatives of the RSC whether they had a new tax code in mind ... Fair tax, flat tax, VAT, or some combination. Their answer was "no". While they're united in their desire to get rid of this tax code and the IRS, they're still undecided on which plan would be better.

As I pointed out, in order to get movement in this sort of a sea change, some sort of 'critical mass' has to be achieved in order to generate enough public pressure on lawmakers to actually do something. Although we've heard various and sundry lawmakers talk about doing away with the IRS for years, as well as talking about a more simple and fair tax code, nothing has ever happened. I still wonder what it is going to take to reach that 'critical mass'. Perhaps a President Hillary Clinton.

Anyway, it is this sort of thing I'd like to see our 435 would-be generals in the House addressing rather than how they plan to micro-manage Iraq. I'd love to see the IRS dismantled, Social Security stabilized, spending indexed in some meaningful way, a legal requirement for balanced budgets and the requirment a super majority to enact new taxes.

They're marvelous brakes on government spending, which is out of control and getting worse. And these are ideas, given what Democrats claimed they were interested in doing if given control of Congress, which both sides should be able to embrace.

Instead, they waste time trying to pass legislation second-guess the generals they just approved to run the war, setting arbitrary timelines and passing non-binding resolutions. In fact, the legislation they are contemplating is larded with billions upon billions in new spending meant to attract votes in Congress. In typical Democrat fashion, when faced with a legislative problem, they answer by throwing more and more money at it (even if the money promised has nothing to do with the purpose of the bill).

A bit of a ramble, however I think the point is clear. The RSC principles are the sorts of things Congress should be considering. They limit government and work toward a more fiscally responsible government. It is that sort of approach, even if incremental, that we libertarians should help support.

Rob Bluey also blogs it about it here.
 
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Perhaps a President Hillary Clinton.
She’d have a veto, McQ.

So we have an idea from this thread what you might drink, now I’m wondering what you smoke?

Yours, TDP, ml, msl, & pfpp
 
Written By: Tom Perkins
URL: http://
So we have an idea from this thread what you might drink, now I’m wondering what you smoke?
So I take it by your remark you don’t support those sorts of principles or think they’d be an improvement over the present situation?

Or was it a case of having a wonderfully snarky line you were dying to use and couldn’t wait for a more appropriate place?
 
Written By: McQ
URL: http://www.qando.net/blog
BTW Tom, the point about Clinton had to do with achieving the critical mass of outrage/outcry necessary to pressure the Congress for significant change in the tax code. Anyone here believe there’d be no new taxes under a Clinton presidency?

As for the veto - Clinton is a politician. Unless a lame duck, she’d veto such a bill at her own political peril. And she’s just not built to jeopardize herself politically.

 
Written By: McQ
URL: http://www.qando.net/blog
Uh, pardon my cynicism but where was this whole idea, say, from 1/03 to 12/06 when it might have had a chance of passing?
The simple fact is, should we do nothing, the government will begin to pay out more in Social Security benefits than it collects in payroll taxes. Eventually the system will be bankrupt. That is unacceptable. Taxpayers have the right to receive back each and EVERY dollar that they entrust to the government for their retirement.
What a bunch of crap. Currently (some) taxpayers don’t get back every dollar they entrust to the gov’t for their retirement, and the system will only go bankrupt if Congress lets it.

And taxpayers will be entitled to a simple tax code once they can be trusted not to abuse it - which is to say, never.

(none of this is aimed at you McQ - though I would note that an enforceable supermajority requirement for raising taxes would require a constitutional amendment as well - and do you really want to tie the gov’t to a balanced budget indexed to growth if, e.g., something similar to WWII breaks out? Just asking.)
 
Written By: Ugh
URL: http://
Uh, pardon my cynicism but where was this whole idea, say, from 1/03 to 12/06 when it might have had a chance of passing?
I suspect that it didn’t show up then because it also had a chance of not passing and making the majority look bad/weak. Now that they’re in the minority, they have an excuse and the new majority to blame. That’s politics, but it’s also one of the reasons we wanted the republicans in the minority now.
 
Written By: ChrisB
URL: http://
I suspect that it didn’t show up then because it also had a chance of not passing and making the majority look bad/weak.
Really? I would have thought that it only wouldn’t have passed if the Dems filibustered, which seems to me would have only brought even greater political benefits ("Undemocratic Dems are filibustering a taxpayer bill of rights!!1" etc. etc. etc.)
 
Written By: Ugh
URL: http://
”I still wonder what it is going to take to reach that ’critical mass’. Perhaps a President Hillary Clinton".
Wait a minute. Is this a trial balloon? I remember how that whole “the first step to getting what we want is to have a divided government.” thing went down in the last election – and look what that got us.

If I follow this reasoning, it is: "If we want to be whole, we must begin cutting off our fingers, then arms, legs, then..."
 
Written By: notherbob2/robert fulton
URL: http://
So I take it by your remark you don’t support those sorts of principles or think they’d be an improvement over the present situation?
No, they are wonderful ideas in the spirit the Republicans ostensibly tender them.
Or was it a case of having a wonderfully snarky line you were dying to use and couldn’t wait for a more appropriate place?
No. I bide my time.
BTW Tom, the point about Clinton had to do with achieving the critical mass of outrage/outcry necessary to pressure the Congress for significant change in the tax code. Anyone here believe there’d be no new taxes under a Clinton presidency?
That would be immaterial, we’d need a veto proof majority for the bill to become law, and that won’t happen.
As for the veto - Clinton is a politician. Unless a lame duck, she’d veto such a bill at her own political peril. And she’s just not built to jeopardize herself politically.
There are far too many people who are certain the New Deal was a good deal for there to be serious consequences to Clinton if she were to veto this, therefore she would veto this.

#1 will always be true no matter what. It’s true now. Nothing can repeal the laws of economics. The question is with what pain is the truth neccessarily accompanied.

#2 is the death knell for FDR’s socialist insecurity, so that won’t happen. Fractionally defaulting on the SS in part is going to have to be a part of the solution to that problem.

#3 isn’t literally true even if it was a passed amendment. We have the right to expect we’ll need to pay for the services we demand, and the right to respect that or be pained to learn that money has a time value. And if #3 were an amendment—we don’t enforce the amendments on the government now, why/how/with what new means would we do so later?*

#4 removes a primary reason the 535 people in the legislature have a$$e$ found to be kissable by those who do so, so they won’t actually pass a version of #4 with teeth. They just won’t.

*I’m all for using the 2nd to enforce the rest of the constitution, but being plausibly able to win is a recondition of just war.

Politics is the art of the possible. What I am interested in is what does this piece of political theatre mean the R’s are really trying to accomplish?

And I’m keeping in mind how they were pilloried when they entertained shutting down the blatanly unconstitutional Dept. of Ed. while I’m wondering what they’re really doing.

Yours, TDP, ml, msl, & pfpp
 
Written By: Tom Perkins
URL: http://
"is a recondition" /= "is a precondition"

Yikes. TDP, ml, msl, & pfpp
 
Written By: Tom Perkins
URL: http://
What I am interested in is what does this piece of political theatre mean the R’s are really trying to accomplish?
Just another brick in the "Dems love taxes" edifice when they refuse to pass it.
#4 removes a primary reason the 535 people in the legislature have a$$e$ found to be kissable by those who do so, so they won’t actually pass a version of #4 with teeth. They just won’t.
For it to have teeth it would have to be written into the constitution - look what’s happened to the ’86 Act.
 
Written By: Ugh
URL: http://
Those ideas would be a great start but I would like,

#3 Taxpayers have a right to expect the government to balance the budget without having their taxes raised.

to also include fees levied and other things that are used to raise taxes without actually raising taxes included in it.
 
Written By: SkyWatch
URL: http://
Currently (some) taxpayers don’t get back every dollar they entrust to the gov’t for their retirement
Part of the problem is that a lot of taxpayers and non-taxpayers get back more than the dollars they entrusted to the government for their retirement.
 
Written By: Mark A. Flacy
URL: http://
I thought of starting my comment by pointing out that this is the textbook example of tilting at windmills, of dreaming the impossible dream. This ain’t going to happen, any more than Bush will win in Iraq, Congress will get rid of pork or that the American people will ever get over their fixation with the likes of Paris Hilton and Brittney Spears.

But then I thought that I’d instead point out that much of it is fundamentally flawed: it sounds good, but only so long as you don’t focus on the particulars.

For example, you want to get rid of the IRS? Fine, who’s going to make sure people pay the taxes they’re supposed to? What, you trust people to send in the right amount? If that’s the case, then let’s get rid of the police as well, as people can surely be trusted to stay on the right side of the law. And we can get rid of the SEC, as nobody would ever look to rip off the investing public.

As far as having a ’simple’ tax code, do you really think a ’fair tax’ or ’flat tax’ would qualify as simple? The existing tax code is not complicated because it has different tax rates for different income levels (is it really that tough to use the tax tables?). The tax code is complex (to the extent that it is) because, to cite an example, it is impossible to define simply ’income’. It’s impossible to define simply ’expense’. And it doesn’t matter whether there’s one tax rate or thirty six tax rates, income isn’t going to be able to be defined any simpler under a flat tax code than it is with the system we now have. Firthermore, making the tax code simpler means having to get rid of deductions (no more mortgage interest deduction, no more charitable contributions) and getting rid of the different treatment for different types of income (no more capital gains, no excluding the gain from selling your house). You think the public is going to line up behind those proposals?

And the tax code isn’t that complicated, at least not for the majority of taxpayers. It took me all of an hour and a half to do my taxes this year (using TurboTax) and most of that time was due to my scrambling to make sure I hadn’t missed any charitable deductions.... which segues into my next point: for most people, there isn’t that much to doing one’s taxes. You plug in the numbers from your W2, type in your kids names, plug in your donations and your mortgage interest and download the numbers from your brokerage firm... and presto, your taxes are done. You may not like the amount you’re paying (I certainly don’t), but it’s not that complicated.

And on a theoretical level, why assume that cuts in spending would translate to less government intrusion? And why would a good libertarian such as yourself be willing to concede that it’s okay for government to take from us the money they’re already taking? Don’t you feel they’re taking too much already? Why not press for them to lower the bite?
 
Written By: steve
URL: http://
The government borrows money on a rate of about 4.25% and the tax revenue grew in 2005 by 11%. That is #1 & #3 covered.
 
Written By: unaha-closp
URL: http://warisforwinning.blogspot.com/
The government borrows money on a rate of about 4.25% and the tax revenue grew in 2005 by 11%. That is #1 & #3 covered.
The meaningful time period over which to measure this would have to be at least several decades, and more likely the sum of the expected (at time of program entry) working lifespan plus expected retired lifespan, because one is how long you put into the program and the other how long you expect to take out...

...picking any one year good or bad is fairly pathetic for even you, unaha.

What’s the overall inflation and growth rate for the last 70 years or so?

Yours, TDP, ml, msl, & pfpp
 
Written By: Tom Perkins
URL: http://
...picking any one year good or bad is fairly pathetic for even you, unaha.
Tom,

That is not just any old year cherry-picked to support an agenda (something I’d never do), it is the most recent year. The year to which highest weighting is neccessarily attributed.
The meaningful time period over which to measure this would have to be at least several decades, and more likely the sum of the expected (at time of program entry) working lifespan plus expected retired lifespan, because one is how long you put into the program and the other how long you expect to take out...
No, because countries do not "work" and are never "retired". Data from 70 years ago is really not much more relevent than data from 170 years ago. The weighting that is given to todays data is much more important, because it takes a measure of all the people in today’s conditions.

Credit is available at historically low rates, America gets to borrow on this and dole it out to Americans of today who are producing a growth in revenue well in excess of the cost of the debt. What you propose is to stop this, because these sort of rates were not available 10 or 70 years ago.
 
Written By: unaha-closp
URL: http://warisforwinning.blogspot.com/

 
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