Friday, March 27, 2009
Forbes: Republican Tax Travesty, by Bruce Bartlett:
On March 19, the House of Representatives voted to impose a 90% tax on the incomes of certain executives of financial institutions receiving federal funds. What was remarkable about this vote is that 85 Republicans voted for this travesty. The consequences will be felt for years to come.
The history of tax policy is that it tends to go in one direction until there is a key event that establishes a new direction. ...
The only reason for the tax increase was outrage, stoked by faux populist right-wing talk radio hosts, over bonuses paid to executives of AIG, the insurance company at the heart of the financial crisis. That the Democrats, who traditionally support soak-the-rich policies, reacted with righteous anger against some fat cats is no surprise. That 85 Republicans joined them is remarkable and possibly unprecedented.
Particularly dismaying is the fact that supporters of the tax increase included senior members of the Republican leadership. ...
The worsening of the government's budget deficit virtually ensures that higher taxes will be required in the not too distant future. When that day comes, Republicans will undoubtedly claim that anti-tax purity prevents them from supporting such action. However, in the case of 85 House members this won't be the case. We already know what they are; it's just a question of negotiating the price.