The GOP is planning the slaughter of the American taxpayer and thus hasten the death of the Republic.
First, the GOP issued its Better Way plan, which includes a Blueprint for tax reform that would increase the already lethal level of over 50% of the people (eligible voters) who pay zero Income Tax, and zero SS/Medicare “tax” (i.e., after offset by Refundable Tax Credits, or “RTC’s”). In addition, many of them also receive tax refunds that are attributable solely to RTC’s — not to tax withheld (i.e., they receive “tax welfare”).
The Blueprint increases the size of the non-taxpaying group, primarily, by nearly doubling the Standard Deduction to $25,000 for a couple. Noted economist Daniel J. Mitchell also warns of the danger of increasing the number of non-taxpayers.
If we allow Congress to ratchet up the non-taxpaying group, e.g., to the 55-60% range, it will always pander to that majority, and sacrifice/slaughter the taxpaying minority. At such high levels, we will never be able to turn back the tide. This is our last chance! We must insist that Congress must instead begin to reverse this long-term trend and expand the taxpaying base.
Second, while the GOP Better Way notes the general agreement to require work for welfare, it goes on to explain that we must somehow “incentivize” welfare recipients to work and that “all parties must win,” without providing details. I fear that the GOP will create costly (for us) incentives that will not be effective to incentivize people to work. The only effective “incentive” required is a cost-free demand that “if you don’t work, you don’t eat.” Work requirements in the 1990’s welfare reforms, were very effective in moving people from welfare to work, i.e., a true win-win for all – such reforms can be improved upon.
Congress spends nearly $1T a year on clearly welfare programs (e.g., food stamps) and not-so-obvious welfare/wealth redistribution (e.g., Medicare, via a 2.9% tax on income, means-testing of premiums, etc.). Congress must combine the myriad of current welfare/wealth redistribution programs (including SS Disability, SSI, Unemployment Insurance, Medicaid, etc.) into a single coordinated program that is gradually devolved to the States, where they belong if anywhere, under Art. I, Sec 8 of the Constitution.
Third, is the Repeal of Obamacare. We must move quickly to repeal this entire horror, taking care to smooth the transition for those caught in limbo by signing up for it. “Replacement” can come later. We must not allow ourselves to be painted into a false corner by DEMs’ demands that we must provide everyone with insurance and actual medical services. The GOP should move ahead immediately to institute common sense market based reform, including selling across state lines, HSA’s, importing drugs, negotiating drug prices, FDA reforms, facilitating groups, eliminating mandatory coverages, etc. Kudos to Rep. Mark Meadows and the House Freedom Caucus for taking this position and fighting against providing more federal insurance.
We hear outrage at the “evil” of denying coverage for “Pre-Existing Conditions” (“PEC”). This is a perfectly valid underwriting issue, not a matter of greed. That is, if insurance companies know in advance that they will have to take anyone with a PEC, especially if they were not previously insured, then they would have to charge all their customers double the premiums they charge today. This would make it a social program, not medical insurance. It may be possible to grant coverage to people with PEC’s who have been previously insured, without raising everyone’s premium.
We hear of GOP plans for high risk pools for the uninsured with PEC’s (a good idea), but that are supported by the taxpayer. Such taxpayer subsidies are unnecessary and improper welfare/wealth redistribution. Any such subsidy that may be necessary to get the pool off the ground should be scheduled to phase out over time. Kudos to Heritage Action for fighting this battle.
We hear of GOP plans to grant “tax credits” to help the poor buy insurance. This is nothing but more welfare, which also further mucks up the tax code.
In sum, we must let the GOP know that we are aware of the issues and that we will hold the GOP to account.
Stephen C. Eldridge is a retired corporate tax lawyer/CPA. He was a nationally recognized expert in his area of specialization in which he co-authored a three volume tax treatise and lectured internationally. He is a retired lifetime tax consulting professional (JD, LLM in Taxation, CPA, co-author of a 3 volume tax treatise, lecturer), with no financial stake in any tax system. For details, call Stephen C. Eldridge tel. 423-532-7337. Website: http://sceldridge.wix.com/sceldridge & YouTube video https://youtu.be/wiVLf1vrQX8