Monday, May 21, 2018
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David Shribman

Overhaul the tax code, by George

The last time the Senate met, it actually came to a unanimous decision. It agreed that the traditional rendering of George Washington’s farewell address, which for 111 years has been read in the chamber on or around the birthday of the first president, would instead occur tomorrow.

It also agreed that Republican Sen. Kelly Ayotte of New Hampshire would perform this commemorative act. That’s a start.

When she reads that revered document, she may think the 17th paragraph was written especially for the 113th Congress. In that passage, our first president talks about “obstructions to the execution of the Laws,” the danger posed when factions hold “artificial and extraordinary force,” and the peril involved when small groups seek “to make the public administration the mirror of … ill-concerted and incongruous projects of faction.”

Now let’s go from the first president to the 44th.

In the neighboring chamber only a dozen days ago, President Obama said the American people “expect us to put the nation’s interests before party,” adding, pointedly: “They … expect us to forge reasonable compromise where we can.”

Much of what he said in his State of the Union address went unheeded at best, opposed at worst. But he did speak of one matter on which both parties could come to swift agreement.

Of course, not a peep has been heard about it from either branch of government since. It is a comprehensive overhaul of our tax system, 100 years old this month.

The President portrayed a tax overhaul as a way to hit deficit-reduction targets. He argued that the country could “save hundreds of billions of dollars by getting rid of tax loopholes and deductions for the well-off and well-connected.”

That’s almost certainly true, but it’s also almost certainly a losing argument. Those who have tax loopholes and deductions are those best armed to preserve what President Washington would have called “the ill-concerted and incongruous” in our tax code.

It’s the next paragraph in Mr. Obama’s address that has political merit. “The American people,” he said, “deserve a tax code that helps small businesses spend less time filling out complicated forms and more time expanding and hiring; a tax code that ensures billionaires with high-powered accountants can’t pay a lower rate than their hard-working secretaries; a tax code that lowers incentives to move jobs overseas and lowers tax rates for businesses and manufacturers that create jobs right here in America.”

In short: a less complicated, fairer system. Also — and here we plunge a policy dagger into the heart of accountants coast to coast — one that is comprehensible to the normal human.

President Obama believes that “now is our best chance for bipartisan, comprehensive tax reform that encourages job creation and helps bring down the deficit.”

He was speaking language his rivals understand, and embrace.

There are two willing parties. One juicy target. What’s not to like? Republicans are going to want any tax overhaul to be revenue-neutral. Democrats are going to want to use it as revenue enhancement. Those differences are not nuances.

There’s going to be a debate about the rate of corporate taxation. But if we are lucky, that will include a parallel one about tax obligations by companies with substantial operations overseas.

There almost certainly will be a discussion about whether the tax system should be an implement of social policy. We have been having that debate for almost 24 decades. We probably won’t decide that one in the next 24 months.

The three most powerful and evocative words in the American political lexicon are John F. Kennedy’s: “Let us begin.” Let’s.

David Shribman is executive editor of the Pittsburgh Post-Gazette.

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