To read Andy Stern’s letter to Grover Norquist, click here.
Dear Andy Stern,
How delightful to receive your note this April 15. I appreciate your stated concern, but rest assured that you are not taking up any of my holiday time. I am a Reagan Republican and my holiday is July 4. As Ronald Reagan pointed out — Republicans think every day is July 4 and Democrats think every day is April 15.
So on your national day of celebration let me thank you for your kind words for the Taxpayer Protection Pledge. I had missed the wonderful quotation from my college classmate Jonathan Alter that the Taxpayer Protection Pledge “has transformed American politics.” The discovery of this pearl of wisdom makes it no longer fair or accurate to say that “Jonathan is always wrong.” I had hoped some things would be constant in this ever-changing world. Alas.
The Taxpayer Protection Pledge is a simple statement we ask all candidates for federal office — House, Senate and presidency — to sign. It states that they will oppose and vote against any and all tax hikes. The Pledge is a written commitment to the American people (not to Americans for Tax Reform.).
The Congressional Pledge reads as follows:
I, _______________, pledge to the taxpayers of the _____ district
of the state of__________, and to the American people that I will:
ONE, oppose any and all efforts to increase the marginal income
tax rates for individuals and/or businesses; and
TWO, oppose any net reduction or elimination of deductions and
credits, unless matched dollar for dollar by further reducing tax rates.
The Presidential Pledge reads as follows:
I,________________, pledge to the
taxpayers of the United States of America ,
that I will oppose and veto
any and all efforts to increase taxes.
And the Pledge offered to all state legislators reads as follows:
I, _____________, pledge to the
taxpayers of the _______ District of the
state of _____________ and all
the people of this state that
I will oppose and vote against
any and all efforts to increase taxes.
From Bill Clinton’s tax hike in the summer of 1993 to Obama’s tax hike sixteen days into his presidency in 2009, there was a fifteen and a half year period without any federal tax increases. (Many silly federal spending programs and regulatory boondoggles, but no net tax hikes.)
Today there are 237 members of the House and 41 senators who have signed the Taxpayer Protection Pledge. That is why the calls for tax hikes from President Obama and Senators Coburn and Durbin are “dead on arrival.” In the states, thirteen governors have signed the Pledge as have 1,253 state legislators.
After praising the power of the Taxpayer Protection Pledge — which, again, I greatly appreciate — you raise a new concern. You find that the federal government takes more money in taxes from Americans in many blue (Democrat-voting) states than it sends back to people living in blue states through government spending. Conversely, the federal government often sends more taxpayer money to people living in red (Republican) states than it takes in taxes.
The solution is to examine what laws lead to this transfer of wealth and fix them.
Culprit Number One: The progressive income tax. A major reason that New Yorkers pay so much to Washington is that they have on average higher incomes than folks in Arkansas. Over the past thirty years, the top marginal income tax rate has declined from 70% to 35%. Yet, the direction of the income tax’s progressivity has steadily risen throughout this period. Today, the top 1% of earners pay 40% of all income taxes. The top 10% of earners pay 70% of all income taxes. The lower half of income earners pay almost none of the federal income tax bill. You have called for an even more progressive tax regime, most notably by your support of President Obama’s Simpson-Bowles tax-increase commission. If more tax dollars are coming out of New York, how does that help your blue state/red state problem? One solution would be to enact a flat-rate income tax where there is only one tax rate. My home state of Massachusetts has, by constitutional requirement, a flat-rate income tax. As does Texas, Florida, Nevada, South Dakota, Washington, Wyoming and Alaska. A baby step to equity would be to abolish the Alternative Minimum Tax (AMT), which raises taxes on primarily blue-state taxpayers who have high state and local income and property taxes and big houses with mortgages. No doubt, some Republican passed the awful AMT tax and we should join hands in abolishing this unfair tax on blue-staters.
Culprit Number Two: The welfare state. One reason so much money goes to Southern states is they have many poor people on Medicaid and food stamps. Now I applaud your desire to put a stop to this right away, but I would suggest we take the measured approach of Paul Ryan and block-grant to the states all means-tested welfare programs such as Medicaid, food stamps and housing subsidies. This is what was done so successfully in the one Clinton-era accomplishment: welfare reform.
Not all solutions must flow from Washington, D.C. Many state and local leaders have been working hard to reduce this inequity. California has passed tax hikes on the very rich, as have Maryland and New York. This helps drive higher-income citizens out of those higher-income states and towards Texas and Florida . . . reducing federal taxes paid by citizens of California, New York and Maryland and thereby reducing the inequality you find annoying. Unfortunately, Mr. Cuomo — the Democrat governor of New York — allowed their emigrant-producing super tax on high earners to lapse. This will slow the “escape from New York” policy that was working so well.
Now that you have uncovered this problem, I look forward to working with you to fix it.
Grover G. Norquist
Norquist is president of Americans for Tax Reform. His Twitter handle is @GroverNorquist