ARC's 1st Law: As a "progressive" online discussion grows longer, the probability of a nefarious reference to Karl Rove approaches one

Thursday, March 17, 2005

Is Kevin Drum for a flat tax?

Kevin Drum outlines some things for Democrats to do to gain the support of "big business"*. One had me almost spitting out my Blueberry Morning®.

CAP suggests closing corporate tax loopholes. Good idea. But instead of targeting "wealthy individuals," why not make the case to corporations that a flatter, broader, simpler tax code is in their best interests? It helps keep rates low and it helps insure that everyone plays on a level playing field, instead of constantly worrying that their competitors are figuring out new and better ways of outperforming them via ever more innovative tax scams.
And then I realized, he's talking about the FICA tax and not income taxes. A few problems with his analysis:
  • FICA is already flat (its a single percentage up to the cap)
  • FICA is already simple (again, its just a single percentage, no need to collect statistics on eating habits, smoking habits, what their mothers hat size was, etc.)
  • FICA applies to everyone (it's already a level playing field)
Interesting to note that the Dem's argument for removing the cap is that it will make things "simpler," and flatter. Look at the 1040 form sometime, and then get back to me.

*By the way, Big-Business!TM is not in the hands of the Republicans. Karl doesn't get to call up the local big-business and tell him how its going to be. In general, they tend to support both sides equally, because well, they're big. It's the small businesses that tend to support Republicans. And Kevin just tried to persaude the leader of that business that it's just simpler that if he works real hard and earns over the cap limit he should just give that money to the government as well. After all, as a former politician here in the St. Louis area once said: "He's been lucky in life's lottery."

Your Co-Conspirator,
ARC: Brian