First off, anyone who has read my blog (thank you, both of you!) or has endured one of my DC Monuments tours knows that Economics is a love of mine. Having lived the blend of classroom education theory and seeing it in practice in the business world, I like to think that I have a perspective that defies having spent a decade living in the 60 square mile enclave bordered by reality.
Which of course, also stands to reason that I understand the insanity of the Obama administration’s insistence on amplifying the irresponsible fiscal policy of his predecessor. So what would lead me to think that tax increases would be a good idea right now? Follow me for a minute…
It doesn’t take a rocket scientist to figure out that when you make things more expensive, such as conducting business, you get less of it. Following A to B means that if we make elements of conducting business, such as regulation, hidden or direct taxes, employee wages, etc. more expensive we get less business. To run a business, one needs employees, therefore more business = hiring, less business = layoffs or closing the business. My apologies if this seems somewhat elementary, as I’m trying to explain this in terms that a DC politician can understand. So what kind of tax increase could possibly benefit our country?
Liberals are fond of all taxes, but lately they have had to become more creative in selling them to the public. Tough economic times have made the public less receptive to hand over their hard-earned money to pay for the latest boondoggle, or generous salaries and pensions for public servants who get to retire at the age of 55. So politicians introduce “sin taxes”, made more palatable by the fact that people are being charged for things they should consume less of, such as tobacco, alcohol, soda, or energy. OK, energy isn’t actually sinful, but try explaining that to a global warmmonger. The kind of tax increase that would help this country would be to place sin taxes not on items that harm individuals, but on items that harm our society as a whole. Here are my proposals for items that should be taxed more heavily:
- Lobbying – One of my biggest complaints about the Bush administration was how the MBA “Let’s finally run government like a business” mentality got applied to Washington, not in how the government would operate but in how those who bribe our elected officials operate. From 2000 to 2008 lobbying grewfrom $1.56B to $3.3B. Of course, curbing lobbyists would turn out to be one of Obama’s many empty promises, and in 2009 lobbying spending increased to $3.48B. Top lobbyists get paid at least two million per year, so why not impose windfall taxes on their profits? Lobbying makes everything more expensive as an added cost of business added to everything we buy – clothing, food, steel, energy, Egg McMuffins, etc. If lobbying becomes more expensive, its activity will drop, and so will costs of doing business. In addition, extra surcharges can be imposed on former politicians and staffers. This will provide the added bonus of pushing them out into the real world and contributing to society!
- Trial Lawyers – This one is pretty obvious. And it’s easy to shoot down the generic liberal straw man argument of “But who will stand up for the individuals who try to take on the powerful corporations?” Settle down, nobody’s suggesting abolishing this fine, respectable profession. But if we’re looking for an industry that brings in huge sums of money while hurting the industries that produce jobs look no further! The beauty of putting windfall taxes on trial lawyers but not on settlements is that it would still give citizens the ability to sue and collect damages where they deserve – the taxes would only be on the trial lawyers themselves. Of course, we would need some heavy-handed regulatory agencies to ensure that people trained in the law don’t use loopholes to avoid paying their fair share of taxes. Perhaps 10,000 new IRS agents? It would be amusing to see liberals argue against heavier regulation over any industry. One potential argument against this from the left is this will lead to far fewer trial lawyers and only the wealthy will be able to afford them, to which I have a simple solution – nationalizing the trial lawyer industry and making them all government employees. Liberals like the idea of nationalizing pieces of the private sector and putting them under government control, why not here?
- Campaign Contributions and Political Ads – Bear with me on this one. I’ll be the first to admit that I am a rehabilitated McCain-Feingold supporter. When I was sold on it I truly believed it would help the process while conveniently ignoring its constitutionality. Of course, it played out exactly as the critics predicted it would, and ultimately accomplished nothing. How does my proposal differ? Campaign contributions, political ads, etc. would still be completely legal, but they would have a heavily progressive tax attached to them. Taxes would be taken out on the back-end, so Joe Blow who wants to send in $50 to help his favorite candidate would still have no problem doing so. The taxes would come out of the recipient, whether it be for ads, signs, or hiring SEIU employees to “monitor” tea party gatherings. Or in the case of large advocacy groups they could be double taxed through funds raised and spent – not unlike the capital gains tax. Only this time instead of punishing the productive class, the tax would penalize the parasitic class.
Bear in mind as you read this that these are just broad strokes. The devil is always in the details, and I’ve no doubt that anyone can find specifics of my proposals to pick apart. But this is a stating point for the conversation. And I have no delusions that any of these will have enough of an impact to make any difference regarding the federal budget defect. But if we want to starve the beast, we’re not getting anywhere until we do something about the masters holding the leash and standing by with bags of treats.
Realistically, none of these ideas have any chance of seeing the light of day, as our elected officials aren’t going to bite the hands that feed them. But as any Robert Jordan fan can attest, these ideas are not the beginning.
But they are a beginning.
Crossposted from Brother Bob’s Blog
