Has the world gone mad? Today, several Democratic leaders seem ready to oppose the President on his proposed tax hikes on the wealthy. What the heck is the world coming to.
Most people who read this blog can probably guess I'm not in favor of raising taxes on the wealthy to support more government programs. I would prefer we get back to a place where we have smaller government and less taxes for EVERYONE. But yet in one of these ironic twists, this part of Obama's plans probably bothers me the least. Now how on earth can someone with my views write this?
Well if you know me, you know I HATE the tax system. I seriously think it may be the evilest tax system in the world. I prefer any plan which makes the tax code simpler and more fair. While I do not think this makes the tax code simpler, it makes it more complex, it does make it more fair. But it is not more fair in the way most people think of it. I honestly do not care to tax the rich more than the poor. What I do not like is when there are deductions in the tax code. The more deductions you have in the tax code, the more loopholes you have. The more deductions you have, the more you distort economic behavior.
By essentially giving rich people less deductions, you are distorting their behavior less. If housing prices and charitable giving drop because rich people can no longer deduct these things I have absolutely no problem with that. If people need a deduction to be charitable then we have some other problems. If housing is only high because government subsidizes it at the expense of non-landowners and it falls, oh well. What I would actually prefer is to get rid of these deductions for EVERYONE. While there are other tax systems I prefer over the flat tax, I would at least concede that a flat tax would be better than the current system we have today which just does not make any sense.