Congress passed an extension of the payroll tax cut on Friday in a package deal. The bill enjoyed widespread but not universal support among both Republicans and Democrats. I see this package as election year defense so it\u2019s probably not worth going through it item by item. Suffice to say that it does nothing to address the fundamental fiscal problems we currently face.<\/p>\n
The conventional wisdom is that \u201cconservatives\u201d always support tax cuts, but I\u2019m opposed to this one. A cut in Social Security taxes when the program is rapidly headed toward insolvency hardly seems responsible. If Social Security is supposed to be self-supporting with a \u201clockbox\u201d guarding the contributions, cutting the tax and \u201cpaying for it\u201d somewhere else in the budget is mere smoke and mirrors. As a matter of principle, Social Security payments should come from Social Security receipts; tax cuts should be on the income side because discretionary government spending should come from tax receipts. Blurring this distinction moves us even closer to the notion of Social Security and Medicare as entitlements independent of taxes originally intended to fund their existence.<\/p>\n
We should be moving in the opposite direction. Consider transportation funding. Highways and bridges should be financed solely through fuel taxes, and all fuel taxes should fund road projects. Doing so creates a modicum of fiscal responsibility because we can actually see what we\u2019re paying and where it\u2019s going. It also makes sound economic sense because costs associated with transportation are borne proportionally by those who benefit from it. The more you drive and the more (transported) goods you purchase, the more you pay for the infrastructure.<\/p>\n
The problem I see with this bill is bigger than the tax cuts. This legislation is further evidence that we are actually politicizing the tax code even further when we should be moving toward transparency and simplicity. It\u2019s difficult to imagine how a Congress that supported this recent bill could favor anything resembling flat or fair tax proposal stripped of political favors and social engineering.<\/p>\n","protected":false},"excerpt":{"rendered":"
Congress passed an extension of the payroll tax cut on Friday in a package deal. The bill enjoyed widespread but not universal support among both Republicans and Democrats. I see this package as election year defense so it\u2019s probably not worth going through it item by item. Suffice to say that it does nothing to […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/battle4liberty.com\/index.php?rest_route=\/wp\/v2\/posts\/454"}],"collection":[{"href":"https:\/\/battle4liberty.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/battle4liberty.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/battle4liberty.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/battle4liberty.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=454"}],"version-history":[{"count":0,"href":"https:\/\/battle4liberty.com\/index.php?rest_route=\/wp\/v2\/posts\/454\/revisions"}],"wp:attachment":[{"href":"https:\/\/battle4liberty.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=454"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/battle4liberty.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=454"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/battle4liberty.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=454"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}