Flat on their Faces

As I noted in the Summit report, Mike Huckabee is making support for a flat tax part of his presidential platform. So, apparently, is Sam Brownback. The flat tax seems to be something that is supported with near-religious fervor by certain parts of the conservative base, but viewed with caution by most conservative intellectuals and politicians. Not that they don't like the idea, it's just that they've been burned before.

J. Goodrich has an article at the American Prospect (for my money, the best liberal magazine going right now) that sheds some light on why even its natural supporters might be gun-shy when it comes to the flat tax: it's a fraud.

The commonly stated benefits of flat tax plans are "fairness," simplicity, and economic growth. These are plans that are usually proposed by conservatives, which might suggest to a cynical person that there is something extra for the conservatives in these plans. And there is: flat taxes would, on the whole, benefit the richest.

Under a flat tax, the wealthy would of course be less burdened by taxes than the middle classes - and the idle rich wouldn't have to pay taxes at all, since dividend and interest income wouldn't be subject to taxation. Goodrich goes on to dispense with the 'economic growth' argument, which not only lacks empirical evidence, but falls apart under the weight of its own logical contradictions. Finally, he points out, there's no reason a progressive tax has to be any less "simple" than a flat tax: all that matters is how many deductions and loopholes you allow, and that has nothing to do with whether the system is flat or progressive.

I recommend reading the whole thing. The flax tax myth didn't die with the Steve Forbes campaign, and while more rational conservatives recognize the issue as a political loser, it's too soon to rhetorically disarm: thanks to the Huckabee and Brownback campaigns, the flat tax goblin still roams the land. And Goodrich points out what the real reason for that might be:

Whatever the actual advantages of a flat income tax might be, the conservatives surely must appreciate the fact that flat taxes make government redistribution of income much, much harder. This could well be the real reason why this misguided proposal has cropped up again.

Labels: American Prospect, flat tax, J. Goodrich, Mike Huckabee, Sam Brownback

  ¶ Posted by Paul Curtis 8:36 AM