Pols on both sides get all twisted up over tax reform

Let us bend our yoga-trained bodies into the Salute to the Sun pose. We are praising Charlie Rangel’s tax reform proposal. The New York Democrat wants to get rid of the alternative minimum tax, modestly cut taxes for most people and modestly raise them for the super-rich.

The Rangel bill does the right moves: It simplifies the tax code and makes it fairer. But no one expects it to go anywhere this year.

The plan already has Republicans hyperventilating about “the mother of all take hikes” — even though it’s actually revenue-neutral. That means it neither adds to nor subtracts from total tax collections. The bill would take back some of the Bush tax cuts for the tippy-top earners, but not all. Even taxpayers making over $1 million a year would still pay less tax than they did before 2001.

But not paying their fair share of taxes has become the sport of kings for many leading moneybags. Some tycoons especially dislike the part that would raise taxes on a private-equity fund manager’s $500-million bonanza to a rate more in line with what the chauffeur pays on his take-home.

So they quietly launched a thousand lobbyists to kill the Rangel bill. Being old regulars in the boudoirs of the super rich, the Republicans instantly vowed to stop the grave “injustice.” But it appears that even some key Democrats are pounding on the door, so eager are they to please the fat wallets.

Wall Street lobbyists recently entertained Senate Majority Leader Harry Reid, who immediately went into Downward Dog pose, with surprising ease. The Democrat reassured them in a closed meeting that plans to subject equity-fund managers to the same tax rates as everyone else would not see the light of day in the Senate this year. He reportedly told them that the Senate was too busy to raise their taxes.

Stay calm, progressives. Breathe in. Breathe out.

House Speaker Nancy Pelosi refuses to bless the Rangel bill, and instead expects fellow Democrats to “have our usual exciting, dynamic give-and-take on the subject.” The spokesman for presidential contender Hillary Clinton, meanwhile, says the Democratic senator “welcomes his (Rangel’s) leadership” and leaves it at that.

Democrats do know the gusto with which Republicans will take a tax hike for millionaires and fool the public into thinking it hurts chicken pluckers and bus drivers. They did it with some success after the 1993 tax reform, which raised taxes only on the top 1 percent, and not by much.

The conservative but virtuous Tax Foundation criticizes such efforts to deceive the yahoos. In its Tax Policy Blog, Gerald Prante writes, “Regardless of whether one supports Rangel’s bill or not, calling it a tax hike is somewhat dishonest.” Rather, he explains, it shifts taxes from one group to another. “Overall, the bill does not raise the average tax rate on the U.S. economy,” Prante adds. And if Republicans want to condemn the bill, they should “call it class warfare rather than attack its revenue neutrality.”

Class warfare?? Not even touch football. Billionaires would barely notice the sort of tax increase Rangel is talking about — and the bottom fifth of earners would see on average only a 1 percent increase in after-tax income.

It appears, alas, that doing the Sun Salutation before the Rangel bill will bring us more exercise than tax reform. But the splendid idea is out there for meditation.

In the meantime, do not expect the super rich to join us in the “asana.” The rich can apparently stop taxation of themselves from rising. In any case, they have private trainers.

Froma Harrop is a Providence Journal columnist. Her e-mail address is fharrop@projo.com.

Talk to us

> Give us your news tips.

> Send us a letter to the editor.

> More Herald contact information.

More in Opinion

toon
Editorial cartoons for Thursday, Feb. 6

A sketchy look at the news of the day.… Continue reading

Curtains act as doors for a handful of classrooms at Glenwood Elementary on Monday, Sept. 9, 2024 in Lake Stevens, Washington. (Olivia Vanni / The Herald)
Editorial: Schools’ building needs point to election reform

Construction funding requests in Arlington and Lake Stevens show need for a change to bond elections.

Lake Stevens school bond funds needed safety work at all schools

A parent’s greatest fear is for something bad to happen to their… Continue reading

Arlington schools capital levy: Say yes to new Post Middle School

Schools are the backbone of the Arlington community. Families want to move… Continue reading

Long sentences not much of a deterrent but serve justice

A recent column by Todd Welch mentions a trope that ignores one… Continue reading

Comment: Trump’s stress-test of Constitution shows it’s up to job

Keep filing lawsuits and the courts will bat down his unconstitutional orders; as long as he follows the rulings.

Stephens: Trump endangers stability of Pax Americana

Discarding the values of a ‘Great Power’ for a ‘Big Power’ will cost the U.S. its standing in the world.

FILE- In this Nov. 14, 2017, file photo Jaìme Ceja operates a forklift while loading boxes of Red Delicious apples on to a trailer during his shift in an orchard in Tieton, Wash. Cherry and apple growers in Washington state are worried their exports to China will be hurt by a trade war that escalated on Monday when that country raised import duties on a $3 billion list of products. (Shawn Gust/Yakima Herald-Republic via AP, File)
Editorial: Trade war would harm state’s consumers, jobs

Trump’s threat of tariffs to win non-trade concessions complicates talks, says a state trade advocate.

A press operator grabs a Herald newspaper to check over as the papers roll off the press in March 2022 in Everett. (Olivia Vanni / The Herald file photo)
Editorial: Push back news desert with journalism support

A bill in the state Senate would tax big tech to support a hiring fund for local news outlets.

Jayden Hill, 15, an incoming sophomore at Monroe High School is reflected in the screen of a cellphone on Wednesday, July 10, 2024 in Monroe, Washington. (Olivia Vanni / The Herald)
Editorial: Students need limits on cellphones in school

School districts needn’t wait for legislation to start work on policies to limit phones in class.

toon
Editorial cartoons for Wednesday, Feb. 5

A sketchy look at the news of the day.… Continue reading

Comment: Costco’s work to defend its DEI values isn’t over

Costco successfully argued its values to shareholders, but a bigger fight looms with ‘anti-woke’ forces.

Support local journalism

If you value local news, make a gift now to support the trusted journalism you get in The Daily Herald. Donations processed in this system are not tax deductible.