I won’t let the rejection of the last liberaltarian bargain I proposed deter me. There are others out there. For example, you have Matt Yglesias’ enthusiastic support for getting rid of “tax expenditures”. These are the millions of little tax cuts that turn us all into special interest groups, which according to Andrew Leonard of the Fiscal Times add up to $1 trillion a year and are growing at several times the inflation rate.
You know these tax cuts, they are the political bread and butter of stump speeches and debates. They allow politicians to say things like:
“I voted for a tax break for working mothers who want to back to school and learn the skills for tomorrow’s green jobs!”
“I voted for a tax break for sustainable health insurance for the children of veterans that would have provided health care and green manufacturing jobs for a million working class South Carolina children, and my opponent voted against it!”
“Senator Dickle and I passed a bipartisan small business investment tax credit that helped entrepreneurs create manufacturing jobs for middle class families; just like Dan Bindle from Dumpsville Alabama who used that tax credit to reopen his grandfathers tugboat factory and put 2,000 sustainable-small-business-working-mother-veteran-entrepreneurs back to work!”
They’ve got the buzz words of “tax credit” and “tax cut”, with all of the benefit of being highly targeted to achieve maximum political value. It’s this high political value that makes me skeptical we’ll ever get rid of them in any significant and permanent way. Remember, if they are designed for maximum political upside as a “tax cut”, they will have maximum political downside as a “tax raise”. Pity the politician who votes to “raise taxes” on working mothers who are going back to school to… you get the point.