Tax Deform… C-SPAN the other day broadcast a conference by the New America Foundation on tax reform. It was an informative, timely program, full of wise ideas about how to alter the tax code in just and economically efficient ways. But what struck me about the conference, at least the portion of it I saw, was a certain suspension of disbelief. I was watching, and the analysts were speaking, as if this discussion were still part of “the process” in Washington, as if these ideas and concerns will help clarify and inform the “tax reform debate” that President Bush has launched, the way nonpartisan and bipartisan experts framed and influenced the tax reform legislation that President Reagan signed in 1986.
Alas, the truth is that tax reform, like so many other issues, is now firmly in the hands of the GOP, which controls virtually all power in Washington. Hence the “tax reform debate” is unlikely to be influenced by forces other than those within the party itself. And the more or less preordained outcome of that “debate” will be legislation that first and foremost advances the long-term political power of the GOP.
Confirmation of this comes from two stories in the papers yesterday. One is about the trial balloon being floated by conservatives to eliminate the deduction for state and local taxes, an idea which, if enacted, would disproportionately punish blue states. Another is about the successful effort by Tom DeLay to outsource the collection of delinquent taxes to private companies. By all objective accounts this will not save the government money; in fact, it would be cheaper to hire more IRS personnel to do the job. But debt collection firms tend to be big GOP donors, and their DC lobbyists are part of the Republican machine. As Nick Confessore has noted, the overall Republican strategy is pretty simple: first take over K Street, then move the government there.