The federal tax code is like the nation’s garage: Over the years it has collected a bunch of obsolete or unnecessary junk that makes it inefficient, ineffective and nearly impossible to navigate.
A bipartisan pair of senators has proposed the kind of common-sense solution adopted by many homeowners — pull everything out and start from scratch deciding what goes back in.
The problem is they want to do it virtually in secret.
Senate Finance Committee Chairman Max Baucus, D-Mont., and the panel’s top Republican, Sen. Orrin Hatch of Utah, want to start with a “blank slate” by eliminating each and every so-called “tax preference,” aka “tax expenditure.” The Congressional Budget Office defines them as “providing financial assistance to specific activities, entities or groups of people.” These barnacles of the tax code function as forms of federal spending and “contribute to the federal budget deficit; influence how people work, save and invest; and affect the distribution of income.”
Baucus and Hatch would adopt a form of zero-based budgeting to remove these preferences. That’s the method by which each year a budgeting baseline begins at zero and each expenditure must be approved before it is added, as opposed to certain expenditures automatically carrying over from the previous year.
The Baucus-Hatch plan is not comprehensive; tax preferences comprise only one tentacle of the vast tax hydra. Plus, the plaque of preferences likely would build up again over time, necessitating another spring cleaning.
Only by replacing the income tax with something like a flat tax or FairTax would the nation prevent the federal code from accumulating ornaments like a family Christmas tree.
Still, the Baucus-Hatch plan is a good start to add at least a semblance of sanity to the code. More important, it offers the promise of transparency by forcing legislators to debate and justify each preference that goes into the empty box.
That is, if Baucus and Hatch didn’t undermine their effort with an incredibly cowardly caveat.
The Hill reported Wednesday that the senators have promised their colleagues — get this — 50 years of anonymity for suggesting which tax deductions and credits they recommend be added back. Any submission will be kept under lock and key by the Finance Committee and the National Archives until the end of 2064, as if it were information that could compromise national security.
So much for having the courage of your convictions. So much for being held accountable by the voters or lobbyists.
That makes the whole process a sham. The thinking behind it also is shameful — that governing would be so much better if it could occur in secret, without democratic repercussions.
That may be the best reason yet to scrap the entire tax code and start over — starting with a fresh slate of federal lawmakers.
From the New Bern (North Carolina) Sun Journal