David Broder on Wyden's Tax Plan

David Broder, the dean of the Washington press corps, has weighed in on Senator Wyden's tax reform plan.

Wyden has introduced what he calls the Fair Flat Tax Act of 2005 as the starting point for what he expects to be a major debate next year on tax reform. "I think it is a certainty that Bush will put this issue on the agenda in his State of the Union address," Wyden told me in an interview, "and the Democrats have to be prepared to offer an alternative that makes sense." ...

The net effect, according to a Congressional Research Service report to Wyden, is that taxes would be reduced for most families whose wage and salary income was anywhere up to $150,000 a year. And it would provide enough revenue to reduce the federal budget deficit by approximately $100 billion over the next five years.

The Wyden tax plan was previously hailed by BlueOregon contributor Steve Novick here: Wyden's Bold Move


  • Becky (unverified)

    I used to be a believer in a flat tax, but as I see the middle class shrinking I'm beginning to believe that maybe the Republicans have been right all along about the rightness of using the tax system to encourage what we want more of. And in fact, looking at what we're getting more of these days (the very poor and the very rich) I have to wonder if they are doing just that.

    It's time to get people in Congress and the White House who truly want more of a middle class (not just in rhetoric, but in practice) and who will change the tax system to encourage that to happen - and from what I've seen, Ron Wyden's proposal would do be a big help in that direction.

    I want to say here that Sen. Wyden has a lot of credibility with me, and I believe he really is working for the people. That means I'm a lot more willing to look at his proposals than I am at the proposals of just about anyone else out there.

    The old argument about the rich providing the jobs is becoming increasingly ridiculous to me. I'm not against people being rich, but if they really are the ones providing jobs then why are more people becoming unemployed and poor as the rich get richer? In truth, it is the middle class who provides jobs while pursuing their dreams via starting small businesses. We need to do a lot more to help these people succeed. Changing the tax system is a good place to start.

  • Chris Andersen (unverified)

    Wyden has very cleverly reframed the discussion of Flat Tax with his proposal. Traditional Flat Tax proposals imply a single rate bracket for all income earners. Wyden is instead trying to change the debate from income brackets to income types by proposing that all forms of income, both from actual labor to investment income, be treated equally by the tax code.

    The Bush/GOP tax plans have overwhelmingly favored investment income over labor income (or, as I call it, the sweat of your accountant instead of the sweat of your brow). This has created a two-tiered class based society (Edwards' Two Americas). Wyden's proposal can easily be placed into a frame of a classless society by asserting that ALL forms of income are valued equally.

    When you think of it this way, it becomes clear that it is the Republicans, with their overemphasis on investment income, who are engaging in class warfare.

  • Robert Harris (unverified)

    Wyden's plan has a lot of potential, and he's right that the Dem's should have a plan for tax reform. I agree with Chris Anderson that one of the most interesting parts of the plan is to treat all income the same. Right now those who work for their money are taxed at a greater rate than those whose money works for them. Thats just wrong. Maybe in the "olden days" - pre technology revolution - a capital lower gains tax rate made some rough sense (though the divendend and interest income rate breaks make absoluitely no sense), but now since we can track inflation, depreciation and historic costs so accurately, you could, if you chose, simply adjustlong term (say after holding asset for two or three years) capital gains for inflation. Which makes the only valid reason for a lowre cap gains rate irrelevent.

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