Category Archives: Fiscal Policy

Why should Lady Gaga pay a lower tax rate than Mitt Romney?

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Published in The News Tribune, February 14, 2012

In my last column (TNT 2-1) I contended that Mitt Romney and others like him should pay more taxes, and that capital gains should be taxed at the same rate as income from work.

Many readers took issue with these claims.  Given the topic’s controversial and divisive nature — and more importantly the extent to which readers objected — I’m devoting this column to a more extended discussion of the subject.

A number of readers wrote in support of low taxes on capital gains on the grounds that lower tax rates are fair. Continue reading →

Loopholes for wealthy weaken fairness of income tax system

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Published in The News Tribune, February 1, 2012

It shouldn’t be surprising that Mitt Romney pays only 15 percent of his income in federal incomes taxes.  After all, he benefits from the fact that his income comes mostly in the form of capital gains – income from selling assets that have increased in value.  Capital gains are taxed at a top rate of 15 percent, which compares with a top rate of 35 percent on wage income.

This provision in the income tax code explains why Mitt Romney, Warren Buffett and most other super-rich Americans, pay less as a share of their income than do many working Americans.  Continue reading →

Lawmakers need to focus on structural problems with budget

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Published in The News Tribune, January 5, 2012

As our legislators return to Olympia, they must feel like the Bill Murray character in the movie Groundhog Day.  Each year they show up at Olympia and find that — once again — revenue falls far short of expenditures.  Let’s hope this year they find a way to awaken from this bad dream.

To start, legislators should begin distinguishing short- from long-term budget problems.  Short-term cyclical problems are caused by a weak economy.  Continue reading →

Trouble 6,000 miles away can shake our financial well-being

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Published in The News Tribune, December 2, 2011

It’s an extraordinary world we live in when a country 6,000 miles away and the size of Washington threatens America’s economy.

But so it is.  Even Olympia’s latest revenue forecast identifies evolving events in Greece as the wild card in its predictions.  How much our state government will have to cut services to our most vulnerable citizens hangs on the fate of Greek bonds – as well as on bonds of other European nations caught up in Greece’s contagion effect.   It goes to show how interconnected we’ve all become. Continue reading →

Flat tax might simplify matters – but it wouldn’t be fair

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Published in The News Tribune, November 8, 2011

Many things are predictable this time of the year.  Earlier commercial appeals to our Christmastime splurges; twilight that sets in seemingly when lunch is over; and proposals for a flat tax, such as we now have from both Cain and Perry.

Actually, three out of every four years, we’re spared the last.  For that we should count our blessings. Continue reading →

Maybe we really do get the politicians we unknowingly want

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Published in The News Tribune, August 31, 2011

No matter what poll you believe, the consensus is that Congress is not doing its job.  In fact, only about one in seven of us think it is.  People express mildly more favorable opinions of the Democrat’s Congressional leadership than of the Republican’s.   But overall the blame for this summer’s fiasco seems to be pretty evenly spread around.

Yet blaming all of Congress for the mess it created while dealing with what should have been the relatively straightforward task of raising the debt ceiling doesn’t spread the blame far enough.

That’s because we’re all a part of a larger problem.  Yep.  You and me. Continue reading →

The solution to the debt crisis really isn’t a solution at all

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Published in The News Tribune, August 4, 2011

Which is better for our country do you think, low taxes or big government?

According to Republicans in Congress, this question captures the essence of our national financial dilemma.

The suggestion that each of us must choose between more money in our pockets on the one hand, and a bloated unresponsive government on the other is politically astute, but also deceptive and irresponsible. Continue reading →

We need long term and short term debt strategies

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Published in The News Tribune, April 29, 2011

When it comes to the economy, it’s hard to know what we should be worried about these days. Not long ago, most everyone agreed that demand –to be precise, a lack of it — was the key concern.  To shore it up, the federal government embarked on a massive spending spree.  The Federal Reserve also enacted a policy of “quantitative easing”, with the hope that this too would help convince us to spend more.

Seemingly overnight, however, the watchword has somehow turned from “demand” to “debt”.   The TNT (4-19) trumpeted this new concern across its headlines recently, referring simultaneously to the growing federal debt as well as the large state debt.    Republicans and Democrats in Washington, DC are now sparring over whose debt-reducing package is better.  Continue reading →

The case for energy taxes is even stronger now

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Published in The News Tribune, March 30, 2011

Like many others, until recently I was a reluctant fan of nuclear energy.   I’d become convinced that it was a safe way of producing electricity.  The fact that one ton of uranium can be used to replace the burning of 16,000 tons of coal or 80,000 barrels of oil is still a strong selling point.    Yet that a nuclear disaster of the magnitude Japan is now facing could happen — in Japan of all places –is surely putting nuclear power’s future on ice.

This reduces the options for meeting our energy needs down to essentially three choices, one of which would be the far better one. Continue reading →

Fiscal problems falling on the shoulders of children

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Published in The News Tribune, March 15, 2011

In theory, local, state and federal governments operate like layers on a cake, each making separate and distinct contributions to the overall cake.  The federal government defends us from foreign enemies, state governments build roads, and local governments quench fires.  In practice, governments are related in ways making the analogy of a marble cake more apt.  For instance each state administers a distinct unemployment insurance program, but federal law and tax dollars make this a state-federal partnership.

Despite complicated relationships among our governments, the fiscal problems that each government now faces is addressed without  considering the collective impact of all the budget cuts.   And so, almost no attention is being paid to how our collective responses to governments’ fiscal problems are disproportionately harming children. Continue reading →