The Debate and Taxes

Taxes were on the minds of those who attended the South Carolina debate last night -- one could hardly miss the impressive pro-tax reform rally put on by the group FairTax.org across the street -- about 8,000 people. (The group advocates for a national retail sales tax to replace the current federal income tax code. An alternative tax reform plan is of course the flat tax, which you can learn more about from the Heritage Foundation here.)

The Republican candidates were strong on the principle of opposing tax increases, while reflecting a diversity of opinion on specific tax policy issues.

In contrast to the Democrats, there was no use of various code words to indicate any interest in raising taxes last night. When a liberal starts talking about "revenue enhancements," "investments" and making the tax code "fair" -- hold on to your wallet. Recall Bill Clinton and a Democrat Congress pushed through the biggest tax increase in history in his first six months in office -- there's little reason to believe the other Clinton won't do the same thing.

I suspect Democrats will spend some time talking about tax reform in this campaign. Yet what they mean and what we mean will be very different. Bill Clinton tried to sell his humongous '93 tax hike as "reform" because "reform" sounds better than "big, huge tax increase for bloated government bureaucracy in Washington."

In fact, his Treasury Department titled the spreadsheets outlining just how the tax increase would work as "Measures To Increase The Fairness of the Federal Income Tax." That's the Democrat defintion of fairness: more money for the government, and less for you.

By contast, Republicans see proposals such as the flat tax and national retail sales tax as opportunities to make our lives a little easier by vastly reducing the complexity of the tax system while removing the damaging and distorting effects of the current tax system on the economy.