Via Ezra Klein
Perhaps the most consequential argument happening in the Republican Party right now is whether a “tax increase” isanything that increases total government revenues, even if those revenues come from closing tax breaks, or whether it means raising marginal tax rates. If the former, there’s a deal to be struck on the deficit that pairs spending cuts with new revenues that come from cutting tax breaks and closing loopholes. If not, well, not. Grover Norquist has been leading the charge against this kind of deal. He says that closing loopholes and ending breaks is only acceptable if the new revenues are immediately plowed into further tax cuts. And today, in an important test vote, he lost. Big
One of the things I’ve noticed is that is gets very difficult to even have a normative opinion on these matters once you start thinking about them in a positive way. It seems almost inevitable to me that tax revenues in the United States will rise substantially over the medium term and so caring about it one way or the other seems pointless.
Its like caring about whether the sun will rise.
There are details to be worked out of course but the basic outline is there. I am betting on VAT, but think the GOP would do better to argue for expanding the payroll tax. Slight chance for a millionaire’s tax bracket and other soak the rich measures but I am doubtful at this point.