Let's Talk. About Taxes

Let’s talk, said Hillary Clinton.  Of course she wanted to just talk pretty in pink, not actually talk about real things like the real money that the government is taking out of our pockets.

In this blog Michael Barone discusses the coming impact of the Alternative Minimum Tax as a political issue.  AMT was a soak-the-rich wheeze back in the late 1960s when Democrats suddenly decided that they were shocked that some millionaires weren’t paying income tax.  But now the AMT is hitting a core Democratic constituency, rich liberals in blue states.

In the American, American Enterprise Institute’s new magazine, former House Ways and Means staffer Alex Brill takes up my point that the upper middle-income people being swept into the AMT are concentrated in heavily Democratic constituencies.

It turns out that the AMT hits particularly hard in states with high state income taxes, so you can see why the blue states would be hardest hit.

Barone speculates that the public employee unions will soon weigh in on this as they are likely to be hardest hit if the AMT starts to bite blue-state finances.

But here is the kicker on taxes.

The Democrats would like to see most of the Bush tax cuts expire in 2010 or sooner; their House and Senate budget resolutions envision obtaining more revenue from unnamed sources and don’t envision extension of most of the Bush tax cuts.

Over my dead body, pal.

That sets up a clear issue difference between the parties, reflecting their genuine convictions on tax levels. But the AMT complicates things for the Democrats.

Good.  They deserve it.

I hope that all Republican operatives are working hard on the tactics that they are going to use against Democrats in 2008 when Democrats, ably assisted by their bribed apologists in the mainstream media, are going to be running away from the very idea that they intend to raise taxes.

Oh no, Democrats will say.  You have got it all wrong.  We wouldn’t think of raising taxes on the American people!  Just a few rich Republican fat cats and evil oil companies!

The question is whether we concentrate on growing the economy so that it can afford the massive bill for the baby-boom retirement or whether we just tax the economy to fund the baby-boom retirement.

There is a difference between the parties on this.