Tom Coburn takes on American's For Tax Reform

[manimal]

http://coburn.senate.gov/public/ind...Group_id=00380921-999d-40f6-a8e3-470468762340


below is the letter

February 17, 2011

Mr. Grover Norquist

Americans for Tax Reform

722 12th Street NW, Suite 400

Washington, D.C. 20005

Dear Mr. Norquist:

As you are aware, the national debt now exceeds $14 trillion and some of us in Congress are determined to do everything we can to end the reckless and out-of-control borrowing and spending that is bankrupting our nation and putting us on the brink of fiscal ruin. This means carefully examining every corner of the federal budget and making difficult choices.

When the National Commission on Fiscal Responsibility and Reform released its final report in December, those of us who supported the report were pleased to have the chance to discuss with you the full details of the report, our reasons for supporting it, and the particular provisions in the report that we continued to have strong concerns with, despite our support for the overall package. Our doors continue to be open to you and all interested parties to discuss important issues facing our country, like debt and deficit reduction, and tax reform.

Now, a bipartisan group of senators, serious about making the tough decisions necessary to resolve this crippling problem facing our nation’s solvency has come together to find common ground. Your letter that we received this week is based on a news article that provides rumored details of a proposal that this bipartisan group of Senators is suggested to be developing. We did not contribute to this article. And, as you are aware, we have released no legislative proposal to this point. As such, it is not always prudent to discuss supposed details of rumored draft legislation, which are most likely to be incomplete, if not inaccurate.

The solution to our economic and fiscal problems will be based on both spending reduction and economic growth. Like you, we believe tax hikes will hinder, not promote, economic growth. And, as you know, the current tax code has become burdensome and complex and filled with provisions which only benefit a limited portion of Americans, at the expense of higher rates for all Americans. Proposals that simplify the tax code, broaden the base, lower all individual and corporate tax rates, and make our corporate tax code more competitive for U.S. business will create a surge in economic growth, which will not only generate more income for the American people and businesses, but more revenue to the federal Treasury, which, as your website notes, is not only allowable, but greatly desired.

Our pledge is to protect taxpayers, not special interests. To do so we must analyze every aspect of the federal budget, including the tax code. Contrary to some press reports or the interpretation by some, we do not believe our efforts intended to avert tax increases on hardworking Americans violates any pledge we have taken, but rather affirms the oath we have taken to support and defend the Constitution of the United States against all enemies, foreign and domestic, of which our national debt may now be the greatest. If and when there is a legislative proposal to be presented to Congress and the American people, we look forward to again working with you and all interested parties to support a proposal where any increase in revenue generation will be the result of the pro-growth effects of lower individual and corporate tax rates for all Americans.

Sincerely,

Saxby Chambliss

Mike Crapo

Tom



I think the strategy of attacking each subsidy and tax loophole one by one and making them public with truth and balance on your side is the only way we can make headway in simplifying our tax code. The lobbyists are too strong for any overarching changes.


Way to go TOM!!

 

[Dr. Zaus]

No, the politicians are too weak, we should elect people that are willing to not play the game the way it has been played.

Also the letter sounded like right wing clap trap with no real substance to add to the conversation.

 

[manimal]

No, the politicians are too weak, we should elect people that are willing to not play the game the way it has been played.

Also the letter sounded like right wing clap trap with no real substance to add to the conversation.

at least he was standing up to established dogma..

 

[manimal]

If you guys dont know who Grover is you should. This guy has had more of an effect on policy than Reagan...


seriously

 

[soundforbjt]

He had me until this: " lower all individual and corporate tax rates, and make our corporate tax code more competitive for U.S. business"

We've got the lowest tax rates in recent history (nearly historically), they don't need to be any lower, just cut the loopholes for corps, religions, and the rich, etc.

 

[Texashiker]

The only tax reform we need is to abolish the income tax, and go with a nation wide federal sales tax.

If you can afford to buy a $300,000 yacht, then you pay taxes on said yacht. If you buy yacht overseas and bring it to the USA, you still have to pay the sales tax.

A recent report said that only about 45% of US citizens pay taxes. This means the income tax and its massive amount of deductions is a failure.

As long as we keep the income tax, things will never change.

Oh yea, and abolish the federal reserve while their at it.

 

[ichy]

Coburn is a lunatic on social issues, but on fiscal stuff he's pretty solid. I'm glad to see he's standing up to that jackass Grover Norquist.

 

[hal2kilo]

It's about f'n time. This country (being a strong middle class) started going downhill when Grover Norquist started his crudade of mindless tax cutting.

 

[ElFenix]

The only tax reform we need is to abolish the income tax, and go with a nation wide federal sales tax.

If you can afford to buy a $300,000 yacht, then you pay taxes on said yacht. If you buy yacht overseas and bring it to the USA, you still have to pay the sales tax.

the taxes would be completely regressive and wreck the economy.

A recent report said that only about 45% of US citizens pay taxes.

absolutely false. pretty much everyone with a job pays payroll taxes, and for most wage earners payroll taxes are the larger portion of federal taxes. and the payroll taxes have funded the general fund forever. so there's no reason that only the income taxes should be considered as federal taxes. there's also federal fuel taxes that nearly everyone pays. and state/local taxes on top of all that.

This means the income tax and its massive amount of deductions is a failure.

i'll agree with the sentiment but not the reasoning behind it.

As long as we keep the income tax, things will never change.

problem is every other tax system attempting to fund the spending of the federal government wouldn't work. so unless we're really serious about cutting defense,

Oh yea, and abolish the federal reserve while their at it.

and leave us with... ? politician controlled money? terrible idea, subject to every political whim imaginable. see south america for much of the last century. commodity money? also a terrible idea, results in stagnation as the money supply can't grow with the economy. like trying to entirely be rid of the income tax, every other option turns out worse.

 

[manimal]

It's about f'n time. This country (being a strong middle class) started going downhill when Grover Norquist started his crudade of mindless tax cutting.

dude our bromance is strong!



Its amazing how much influence the policy hawks have had over the last 30 years shaping the discussion.

 

[Anarchist420]

If we absolutely have to have federal taxation, then we need to go back to tariffs and excise taxes and radically slash spending. That's not regressive and we could easily get about $1.5T/yr from those two. If we defaulted on the Federal debt, and reinstated Jackson's specie circular as well as the subtreasury system, means tested for SS, and abolished Medicare, then we could easily slash spending to under $750B.

I really don't see how the income tax isn't oligarchy, as rich people who don't work don't have to pay it. Think the Hiltons and the Rockefellers.

 

[Texashiker]

the taxes would be completely regressive and wreck the economy.

Sales taxes work, the 50 states that have a sales tax prove it. Does the state you live in have a sales tax? Is its economy wrecked because of it?

and leave us with... ? politician controlled money?

We are left with the same currency that supported this nation from its founding until the early 20th century.

terrible idea, subject to every political whim imaginable.

Its kinda strange that the Great Depression happened shortly after the federal reserve and the income tax were established.

Congress having control of the money can not be any worse the the federal reserve. At the very least, congress is elected, while the federal reserve answers to nobody.

 

[ElFenix]

Sales taxes work, the 50 states that have a sales tax prove it. Does the state you live in have a sales tax? Is its economy wrecked because of it?

sales taxes do work, but the reason the whole economy isn't fscked is because the overall tax system is slighly progressive. if it were made very regressive like replacing the income tax with a sales tax, it'd be fscked. and not all 50 states have sales taxes.

We are left with the same currency that supported this nation from its founding until the early 20th century.

which didn't even work out all that well for a bunch of farmers with real economic growth driven nearly entirely by settlement of the interior of the country. the only reason the whole system didn't crash is there were a couple large gold deposits found, thereby increasing the money supply. we're not finding new gold deposits in an amount necessary to prevent stagnant economic growth.

Its kinda strange that the Great Depression happened shortly after the federal reserve and the income tax were established.

income tax had nothing to do with it. the imposition of war debt on germany had a hell of a ton to do with it, and economics being rather primitive had a lot to do with it as well.

Congress having control of the money can not be any worse the the federal reserve. At the very least, congress is elected, while the federal reserve answers to nobody.

federal reserve answers to no one? do you know how often they're called in front of congress?

political control of the money supply has been nothing but disastrous everywhere it's been done. if you want an unsustainable credit boom, by all means hand control of the money supply to elected officials. the gold standard for money supply control is germany and the bundesbank is about as insulated a central bank as you can have.

 

[Dr. Zaus]

A federal VAT would make the most sense, let the AMT fall to the point that everyone pays it (thus a flat tax on top of the regressive VAT) and then send out a check to everyone for the VAT you would pay if you where at the poverty level and spent all of your money (Thus making it a progressive tax for all but those that save more than poverty-level spending every year).

In this way we are no longer punitive against those that work the hardest (a tax incentive to work harder, imagine that!), we don't hurt those who are doing worst in society and honestly need the help and the only people that can ever be the ones to pay our tax burden, the middle class, continue to pay said tax (without penalizing them for not being poor).


I've been saying this for years... Some day the rationality of it will sink in and this will be implemented.

 

[Texashiker]

federal reserve answers to no one? do you know how often they're called in front of congress?

When was the last time the chairman of the fed was elected by the people?

He never was.

When was the last time the federal reserve was audited by the IRS? After all, the federal reserve is not part of the govenment, its a private company.

No private organization should have control of a country or its money

 

[werepossum]

A federal VAT would make the most sense, let the AMT fall to the point that everyone pays it (thus a flat tax on top of the regressive VAT) and then send out a check to everyone for the VAT you would pay if you where at the poverty level and spent all of your money (Thus making it a progressive tax for all but those that save more than poverty-level spending every year).

In this way we are no longer punitive against those that work the hardest (a tax incentive to work harder, imagine that!), we don't hurt those who are doing worst in society and honestly need the help and the only people that can ever be the ones to pay our tax burden, the middle class, continue to pay said tax (without penalizing them for not being poor).


I've been saying this for years... Some day the rationality of it will sink in and this will be implemented.

PLEASE don't advocate a VAT! That would absolutely kill American manufacturing. I'm a big fan of the FairTax, which is slightly progressive in that taxes at the poverty level are prebated to every head of household. Thus those at the poverty level pay no federal taxes (including payroll taxes), those below the poverty level get a subsidy, and those above the poverty level pay an increasing amount of their spending as their income increases. The only thing left for Congress to game is the poverty level, which operates the same for everyone. But no VAT or sales tax should be levied without totally abolishing the income tax. Otherwise we simply have two taxes that the progressives can alternately increase.

 

[Dr. Zaus]

But no VAT or sales tax should be levied without totally abolishing the income tax. Otherwise we simply have two taxes that the progressives can alternately increase.

But if things cost more but people have more money, the incentive becomes to save instead of spend, which is better for everyone that isn't a banker.

The economy is not a fragile being, with the exception of major intervention entrepreneurs find a way to exploit resources in ever more efficient ways.

VAT is much better than a Gross receipts tax, which is crazy disruptive to proper economic allocations of labor and goods.

I also support the elimination of the ability to write-off interest, further capital gains tax should be equal to the flat income tax and corporations should only have to pay the VAT and not corporate income tax (thus eliminating all those loop holes they use to get out of them anyway).

let us also make a VAT that taxes fully any value not already taxed on the product, thus eliminating the tax incentive to make products outside of the US because the retailer will have to pay those higher taxes on those things that have not paid US VAT?

 

[Texashiker]

VAT is much better than a Gross receipts tax, ?

As long as the VAT is flat, with no discount for expensive items, then it might be fine.

But what will probably happen, the VAT will be tiered where the higher end ticket items will have a lower VAT then say a lower priced item. So once again the rich do not pay their fair share.

For a tax to be fair, it has to be flat. It the tax is flexible, then the rich will get people elected that favor tax breaks for the rich.

 

[mchammer187]

The only tax reform we need is to abolish the income tax, and go with a nation wide federal sales tax.

If you can afford to buy a $300,000 yacht, then you pay taxes on said yacht. If you buy yacht overseas and bring it to the USA, you still have to pay the sales tax.

A recent report said that only about 45% of US citizens pay taxes. This means the income tax and its massive amount of deductions is a failure.

As long as we keep the income tax, things will never change.

Oh yea, and abolish the federal reserve while their at it.

If you think people cheating on income tax is bad it is much worse with sales tax. Say the tax is 20%. Basically people would be saving 20% by not paying sales tax. It would be so much more of a nightmare to enforce.

 

[Texashiker]

If you think people cheating on income tax is bad it is much worse with sales tax. Say the tax is 20%. Basically people would be saving 20% by not paying sales tax. It would be so much more of a nightmare to enforce.

And you dont think enforcing the income tax is just as bad.

At the very least, it would push the burden off of the everyday citizen. Instead of your average John Doe getting audited, it would be businesses.

Who knows, the IRS might even be able to break through that corporate shield and do some good. Maybe the government would start prostituting the real criminals instead of the average working class.

 

[ElFenix]

When was the last time the chairman of the fed was elected by the people?

He never was.

When was the last time the federal reserve was audited by the IRS? After all, the federal reserve is not part of the govenment, its a private company.

No private organization should have control of a country or its money

all the fed board members are appointed by the president and congress, just like a billion other political appointees. not to mention it turns over its profits to the treasury.

 

[Patranus]

Bring on the flat tax.

 

[Dr. Zaus]

all the fed board members are appointed by the president and congress, just like a billion other political appointees. not to mention it turns over its profits to the treasury.

The FOMC has on it a significant number of unapointed people that just happened to be the president of a bank.

http://en.wikipedia.org/wiki/Federal_Open_Market_Committee

 

[piasabird]

A national Sales tax will not work very effectively. It will also increase cost for food for the poor??? What happens when the economy gets bad and people buy less? I think we need an income tax that sets rates for taxes that are collected as people make them, and then people would not have to file a tax return. Keep the rates lower and then supplement it with a sales tax that excludes food staples. We should at leas be able to eat.

I think we also need a value added tax for all products imported including automobiles. Call it the "Invest in America Tax." If people want foreign products that is fine as long as they pay the tax.

 

[Dr. Zaus]

A national Sales tax will not work very effectively. It will also increase cost for food for the poor??? What happens when the economy gets bad and people buy less? I think we need an income tax that sets rates for taxes that are collected as people make them, and then people would not have to file a tax return. Keep the rates lower and then supplement it with a sales tax that excludes food staples. We should at leas be able to eat.

I think we also need a value added tax for all products imported including automobiles. Call it the "Invest in America Tax." If people want foreign products that is fine as long as they pay the tax.

Non processed food is usually exempt from such taxes; but sending everyone a preemptive refund for the taxes paid up to the poverty level works too,
.
The economy is robust, more savings will not end America, only restructure our resource allocation away from fast food and toward big ticket items (because of increased savings) this reduction in spending would head off inflation from over spending.

That said you are right on regarding your ideas. But we need vat on locally produced items aswll otherwise it will be an unfair traid terif; but we can help off set our local VAT by ending corporate income tax.