- Don’t bite off more than you can chew
President Donald Trump’s administration is suggesting that they are redefining their plans for tax reform. Let’s assume that “redefining” means they are thinking it through for the first time.
It is a fortuitous time to be considering revisions to the tax code.
The chairman of the House Ways and Means Committee is an affable, approachable, intelligent Texan named Kevin Brady. He started off this year thinking about Donald Trump’s definitions of trade and taxes, which led him to propose a tax code to favor domestic production over the importation of goods. He called it the Border Adjustment Tax. The trouble with BAT is that he gave its opponents all the time they needed to re-brand it as a deadly tax upon consumers. Whatever its merits were, BAT is DOA.
Over on the Senate side, nothing on taxes is happening. In fact, nothing is happening on the Senate side unless Senate Majority Leader Mitch McConnell wants it to happen. Now that Neil Gorsuch is on the Supreme Court, the Senate just may pass appropriations into 2018 and quit the year early.
The late, great Utah Senator Bob Bennett once observed that tax policy ought to be the least costly, least disruptive, simplest system to raise the revenue to support the legitimate functions of government.
Today’s tax code favors capital over labor, debt over equity, and managerial authority over talent.
Our 45th president loves to look back at the manufacturing power we once were. It is a theme that can vault a stadium full of voters to their feet, but he cannot make America great again if he puts the tax code in reverse.
Today, the U.S. economy runs on a “liquid workforce” — Accenture’s term for the combination of full-time and contract talent that can be turned on, or off, like a faucet. It’s a lovely metaphor if you’re writing pitch decks at a management consulting firm, but it’s not so pretty if you’re trying to raise a family.
The voters who vaulted Donald Trump into the White House deserve better.