The tax bill recently enacted didn’t resolve anything, it just kicked the can down the road for another two years. They act like the compromise on the estate tax “resolved” that issue, but it is only resolved in “politician time” which is the distance between elections.
Congress is anti-business and anti-family because of the short term periods of legislative definity that it imposes in laws that should be long term to provide business and families with the ability to plan and execute personal economics.
The situation that we have to wonder is what the tax rate will be every two years predicated on the outcome of opposing ideology in the next election. It’s absurd.
Our founding fathers were businessmen but today we elect mostly lawyers to Congress, who think like politicians with no business acumen.
The President filled his cabinet administration with politicians, so to no one’s surprise, his policies eventually became labeled anti-business because no one in power knew business. Obama is vigorously attempting to mend fences with business that he stupidly allowed to be broken.
I don’t think that I have ever seen a two-year business plan. Businesses may have five- and 10-year business goals and objectives, but most business plans are even longer, becoming generational.
Why then, does the USA with its long history and “bright future” as depicted by our illustrious political leaders have just a two-year tax plan, which is reauthorized about two weeks before it lapses? Income tax law should, at a minimum, be 10 years. Frankly, it should be permanent, requiring a new Act of Congress in order to be changed.
What, pray tell, changes every two years that impacts what the income tax rate should be, that requires constant revisiting? If tax laws were set without expiration, Congress would more closely know what revenue it would have to work with. If events happen that clearly in the national interest require additional government revenue, then this revenue should come from surtaxes, specifically linked to the need.
For example, if a President decides that he wants to go to war as George W. did in Iraq, instead of funding it off budget, borrowing the money from the Chinese, Congress should have billed the American people directly with a surtax so they know in dollars and cents, the personal cost of this war they are then supporting.
If this country goes to war, the American people ought to get out their checkbook and pay for it. This country should not be fighting wars that the American people are not willing to pay for. The disconnect between this country’s policies and paying the bills for this country’s policies, is undermining our democracy through manipulation of how these costs are met.
The Pentagon spent $160 billion on the wars in Iraq and Afghanistan this budget year. That is on top of hundreds of billions of dollars spent previously that tacked onto the deficit.
Taxpayers don’t know the cost of these wars because they were funded by borrowing. I believe the Bush tax cuts ought to be made permanent, but that $160 billion should be funded by a surtax so the American people connect war with the financial cost to this country.
My motive is not to undermine our ability to defend this country or pursue our national interests. If a war is justifiably worth fighting, then they should be paid for, not put on the tab of the next generation. A truly great people and great nation should not be diminished by this test.
It should be a rallying point that when our enemies see the American people support military action with their checkbooks, that the resolve of this nation is truly strong.
Circling back to two-year tax extensions, the tax law that is the most structured to be long term is estate tax law. The idea that setting the estate tax law for two years really accomplished anything in terms of setting the boundaries for the generational transition of assets is a blown out light bulb.
I have no problem with the Congressional estate tax law that was enacted. I think that both liberal and conservative ideologues are unhappy with it, so it must be as good a compromise as we were going to get as compromises inherently leave the extremes of opposition wanting. Make estate tax law permanent!
What changes every two years that a Congress, with all the pressing issues at stake for this country that need attention, thinks that it has the time to perpetually debate this issue? Generations cannot plan estates with biannual tax laws.
Index the estate tax law for inflation, make it permanent and go to work solving some other problems. Ideologues perpetuate debate, rancor and political turmoil. On most critical pressing issues of the day, polls show 40 percent think one way and 41 percnet the other. Ideological contests will never solve problems sinking us to the bottom.
Business is essentially about solving problems. That’s what I do everyday as a CEO. Much of the time, when short term business decisions are made that should be long term business decisions, when they opt for the short term decision they are doing the wrong thing long term.
David Kruse is president of CommStock Investments Inc., author and producer of The CommStock Report, an ag commentary and market analysis available daily by radio and by subscription on DTN/FarmDayta and the Internet.
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