A Silver Lining in the Tax Cut

The recent tax cut makes me angry and leaves me in despair.  The time, however, to lament is over.

This was not tax reform.  Primarily, tax reform would be revenue neutral, certainly not blowing a hole in the federal budget.  Tax reform would have made changes to the tax code so it could reflect some economic realities today which were not present in the mid-1980s.  Good tax reform would have sought to achieve laudable economic objectives, such as encouraging an increase in personal savings to help people accumulate assets for their post-working lives (aka retirement), or it might have sought to diminish the disparity between rich and poor.  Instead, this tax bill blatantly shifted wealth from the poor to the rich and reduced revenue in order to cut social programs.  (Darn this is like the Roman Empire during Jesus’ time.)

But it’s too late.  It is the law of the land.  However, the bright silver lining in this really dark cloud is an opportunity for the Democrats in 2018.  I hope they don’t blow it.

The Democrats can use this tax cut to make clear not only how they are distinctly different from the GOP (in case people continue to believe there is no difference between the parties), but their vision for America.  It must go beyond platitudes and feel good phrases.  (Attention Democratic leaders, “A Better Deal” doesn’t say much when the GOP set a pretty low bar.)

No Republican voted for the Affordable Care Act.  The party spent years vilifying it.  Repealing it was its rallying cry.  Speaker Ryan even unveiled a replacement for it in 2016.  That was an empty proposal because when the Republicans took control of both houses of Congress this year, they failed to pass any replacement legislation.  They, however, severely damaged the Affordable Care Act.  They did further damage with this tax bill to the health insurance market by eliminating the mandatory insurance penalty, thus disrupting the health care market for everyone.

The Democrats have to be better.  They have to be prepared to be a credible opposition party beyond “we’re not Trump and we’re not Republicans.”  The party should prepare a solid tax reform proposal to present to the public in the second half of 2018.  It should not have “to be determined” blanks or include wishful thinking about economic growth.  It should articulate clear economic objectives with equally clear rationales.  It should be just, otherwise known as progressive so that those at the bottom of the economic ladder have a lesser burden than those at the top.  It should offer credible support to strengthen and sustain the common good.  It should be ready for passage should the party capture either the House or the Senate or both.

I find the idea of tax reform perplexing without linkages to government spending, which should relate to larger aspirational goals and objectives for this nation.  Furthermore, our current reality should inform those goals and objectives.

Technology that did not exist 30 years ago has disrupted companies and industries.  National boundaries no longer restrain the movement of capital.  Like the past, companies will seek out the lowest cost producer, except today that lowest cost producer could be across the ocean.  Thus our tax policy should reflect this reality by encouraging companies to develop new products and new businesses here in this country, such as promoting long term research and development.

Technology also allows knowledge to move across the globe with few barriers.  I often use the example of accounting.  Not long ago an accounting major could get an entry level job in a large company and expect a reasonable upward career path.  Today, financial data moves via the internet and with accounting principles the same regardless of currency, why can’t a company located here in the United States find cheaper entry level accountants in Vietnam?

Consequently, we need to enable people who lose their jobs to gain new skills.  It could entail lifelong education programs.  How can we make the tax code work to enable people to get this education at minimal or no expense?

As an aging nation, we face two issues.  First, we are living longer.  As Social Security relies upon current contributors supporting current recipients, we are facing fewer contributors supporting a larger pool of current recipients.  Younger workers already worry about diminished Social Security benefits upon their retirement.  Additionally, traditional pensions are vanishing.  We should encourage savings for retirement.  Second, as we live longer, the costs to keep us healthy increase.  The Democrats should make clear why some form of universal healthcare is necessary, (note there are four basic models to provide universal health care) and then develop a tax policy to support it.

I want to hear how the people of this nation will ensure that everyone, regardless of gender, gender preference, age, race, physical and mental ability, ethnicity, or country of origin, can live their lives with dignity.  I don’t want to see people standing in line waiting for food at a food pantry, especially people who worked hard all their lives and now in their later years have to suffer this indignity. (Reflect upon this for a moment.  That we have accepted people standing on line for food means we have accepted begging as a part of our food security policy.)  I don’t want to figure out how an unmarried single person without children, who lost his pension because his employer used his pension as an asset when it got sold a decade ago, will live with his health issues when he can’t afford housing or private care.  I want us to find unacceptable children who live in poverty.  I want all people to live in peace, as in shalom, the wholeness of life, and to have hope for their future.

Tax policy provides an economic foundation for our national hopes and aspirations.  In one sense, it is an economic reflection of the type of nation we believe we are and hope to be.  To the Democrats … tell us and make it real.

Advertisements

About Quentin Chin

Eclectic interests: religion, technology, food, music, current events. I live in the reality-based world.
This entry was posted in Current Events and tagged , , , , , , . Bookmark the permalink.

One Response to A Silver Lining in the Tax Cut

  1. EILEEN MARTIN says:

    You offer a breath of fresh air after living through this past week! Thank you Merry Christmas to you,and family, Allegra, and best wishes for the new year. Cheers, Eileen and Barb

    >

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.