RX for Success

Stork in Morocco - photo by JoAnn Sturman

Scott Sturman
fliesinyoureyes.com

"Power corrupts and absolute power corrupts absolutely." - Lord Acton

The contentious debate on health care reform illustrates the disreputable side of Congress. Despite most Americans' antipathy toward the legislation in its present form, Congressional leaders are willing to buy votes with tax revenue to pass a law that will not solve the problem. To the imperious politician special deals, hidden agendas, bribery, and extortion conveniently are clumped under the disingenuous euphemism of statesmanship. Senators and Congressmen for life, omnipotent committee chairmen, and the convoluted federal income tax system are the fies in the ointment which threaten the Republic.

It is inconceivable current members of Congress will address these three issues. They are simply too comfortable with special retirement and health plans not available to the general public and the high profile, ego friendly environment of Washington. Transforming the political climate will erode their power base, and much of the control they wield will be transferred to the states and individuals. Change must be initiated from outside the cloistered halls of Congress – by the voters who unwittingly placed them there in the first place.

RX #1: Term limits, twelve years for Senators and ten years for Representatives, are the only manner to curtail the pernicious antics of the professional political class. It is exceedingly difficult, however, to cure an opium addict once he has access to an unlimited supply of the drug. Such is the case with the United States Congress where individual members are loathe to part ways with corrupting power. In the short term we voters must defeat the incumbents during the primary elections by supporting a competing candidate from their own party who advocates official term limits. Until the voters are willing to do so, enthroned politicians call our bluff and conduct business as usual.

RX #2: Congressional committees are the fiefdom of their chairmen. Their uncontested power marginalizes reasonable committee members and encourages partisans who shape debate to gain short term goals. They are particularly susceptible to the manipulations of paid political consultants who financially support their reelection efforts in return for special favors dispensed by the chairman's committee. Rather than continuing the tradition of selecting the most senior member of the majority party, a novel technique is required. It would reduce corruption (pork), foster meaningful input from both parties, and eliminate the automatic selection based on seniority. The committee chairman would represent the majority party and the term would be limited to two years, but the chairman would be determined by a vote of the minority party. This unique concept would undermine the power base of the ideologues and enhance the status of leaders who are able to craft legislation with bipartisan support.

RX #3: Since its inception, the federal income tax rate has varied significantly from less than 1% in 1913 to 90% during WWII. A summary can be found at: http://www.taxfoundation.org/publications/show/151.html. Accompanying these rate swings are a vast array of exemptions which effectively reduce the theoretical maximum tax rate. Congress always has had the ability to legislate social behavior by manipulating rates and write offs. The current tax system is overly complicated and serves as a vehicle by which the government controls individual behavior with the use of credits, penalties, deductions, and exemptions. Expensive to compute and collect, capricious, and confiscatory, the federal income tax is as much a tool for controlling behavior as it is for collecting revenue. Flat taxes and consumption taxes depoliticize and simplify the tax code. They encourage saving and reward initiative. An excellent summary of the flat tax can be found in The Flat Tax by Robert Hall and Alvin Rabushka.

In regard to taxation one other issue must be addressed. By 1994 the Tax Foundation cited that 40% of all Americans were outside the federal income system. The situation has deteriorated in the last fifteen years. In depth details can be found at: http://www.taxfoundation.org/research/show/542.html. Avoidance of payment of federal incomes taxes is possible by making too little income, not filing because of low income status, or representing other family members who pay no taxes. These sobering statistics demonstrate the escalating tax burden borne by fewer and fewer Americans. This disconnect between those receiving services and paying nothing for them and those paying taxes is worrisome. Even a nominal tax obligation of 1-2% of net income requires all citizens to contribute to the welfare of the society. It establishes a mind set that there is a price associated with receiving benefits, and the burden of taxation is just not someone else's problem.