published Sunday, December 16th, 2012

Taxpayer Protection Pledge needs a few tweaks

The Taxpayer Protection Pledge has been in the spotlight since Sen. Bob Corker, R-Tenn., a signer of the Pledge, presented a plan to address the fiscal cliff that violated the covenant’s guidelines. Americans for Tax Reform (ATR), the D.C.-based nonprofit that administers the Pledge, responded strongly, vowing to go after anyone who supports Corker’s plan.

As a result, conservatives are divided on the issue. Should Pledge signers compromise on their promise not to raise taxes in order to legislate a workable solution to the fiscal cliff? Or should they strictly adhere to the Pledge in hopes that it roadblocks liberal policy-makers from instituting planned tax hikes? The answer may be a little bit of both.

Since 1986, when ATR founder and president Grover Norquist first introduced the idea, the Taxpayer Protection Pledge has asked signers to make two promises:

• Oppose any and all efforts to increase the marginal income tax rates for individuals and/or businesses; and

• Oppose any net reduction or elimination of tax deductions and credits, unless matched dollar for dollar by further reducing tax rates.

The Pledge — which is a promise to constituents, not to Norquist or ATR, as some critics wrongly suggest — has been extraordinarily effective. It has given fiscally conservative federal and state lawmakers a concrete way to express their belief in responsible government. It has also offered voters a way to determine which candidates are serious about low taxes. Further, it has held elected officials’ feet to the fire, since lawmakers who break the Pledge rarely stay in office.

Most importantly, with the Pledge, ATR has faithfully and successfully kept Congress — as well as state legislatures — from passing most proposed tax increases.

However, it is becoming apparent that the Pledge’s restrictions can be counter-productive to efforts of conservative policy-makers. The Pledge has also grown into an impediment to ATR’s ultimate goal of overhauling America’s convoluted tax structure and replacing it with a system that is much flatter and fairer.

Specifically, the Pledge has two drawbacks. First, it focuses exclusively on government tax policies, while completely ignoring spending. This is not a problem for state governments since 49 states have some form of a balanced-budget requirement, making it difficult for government to spend more than it brings in. On the federal level, however, where the government can borrow (and even print) money, and spending can far exceed revenues, the Pledge has done little to address the serious issue of spending.

Governments don’t go into debt by taxing too little; they go into debt by spending more than they have. While its determination to protect the American taxpayer from excessive taxes is important, Americans for Tax Reform — or perhaps another similarly positioned national organization such as the National Taxpayers Union or the Taxpayers Protection Alliance — should direct its focus towards encouraging members of Congress to promise to balance the federal budget each year.

The second problem with the Pledge is its requirement that when a tax deduction or loophole is eliminated, a tax cut must be implemented that reduces the tax burden by at least the same amount.

On its face, it’s a completely understandable position. After all, the people who previously claimed a now-eliminated deduction pay more in taxes, thus it’s fair that their taxes be lowered somewhere else so that their overall tax burden doesn’t increase. Unfortunately, the stipulation prevents beneficial policies from being passed and, worse, makes it much more difficult to implement the flat tax that ATR claims as its greatest goal.

For example, ATR stonewalled Republican efforts to eliminate unpopular and outlandish tax credits on ethanol production. The Ethanol Tax Credit, now expired, took a $20 billion chunk from the federal budget. It was largely recognized by many on both sides as incentivizing a bad idea. ATR heavily criticized lawmakers who tried to eliminate what amounted to a green energy handout because it wasn’t coupled with $20 billion in tax cuts elsewhere. Without allowing Congress to easily remove unjustifiable tax credits, it will be impossible to ever usher in a meaningful flat tax system that simplifies the tax structure by creating one standard deduction for all.

Over the past quarter century, the Taxpayer Protection Pledge has been perhaps the single most important factor in keeping existing taxes reasonable and preventing new taxes - but, by itself, the Pledge is not enough to keep the federal government in check.

Minor alterations to the Pledge that address the issue of spending and deductions would make it an even more valuable tool while allowing it to continue to succeed and its intended mission of lowering taxes.

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fairmon said...

Grover Norquist is not an elected official and has too much influence on those elected. Congress should know and represent the views of their constituents without influence from special interest and organizations such as Norquist's.

December 16, 2012 at 4:43 a.m.
hambone said...

Norquist thinks he's been elected. I saw him on a recent tv show talking like he was a member of Congress and how "we" were going to vote on issues!

December 16, 2012 at 7:52 a.m.
AndrewLohr said...

What does "representative" mean? Senator Corker can ignore me and I him, but he and Mr Norquist don't ignore each other, and Mr Norquist is an OK proxy for me.

December 16, 2012 at 7:59 a.m.

He's not for me, in fact, I consider it treacherous for a non-resident of this state to be influencing Corker's decisions through threats of money being spent on a campaign.

See that's the big problem, he's not one citizen acting for himself. He's using money to influence the outcome of an election in order to get the results he wants.

It's too few steps from bribery. There's a reason why John McCain once opposed such campaign spending.

But the TPP has had only one result. The debt and deficit its putative advocates are now hysterical about. Don't they realize they have reaped what they have sown?

December 16, 2012 at 11:29 a.m.
Rickaroo said...

That pledge doesn't need to be "tweaked," it needs to be torn to shreds and relegated to the scrap heap of bad ideas. Mr. Johnson says that it is not a pledge to Norquist or ATR but to each signer's constituents; but it was the brain-child of him and that organization so in a sense it IS a pledge to them. If each elected representative wants to make a pledge to their constituents, then let each of them make their own pledge. The only other oath they need to be concerned with upholding is the one they made to uphold the Constitution. Signing that pledge was nothing less than an act of treason.

Taxation itself is not evil, it is not "stealing from the makers to give to the takers," as most teabagging brain-dead conservatives are trying to make everyone believe. It is sanctioned by our Constitution. Not only that, every civilization from the beginning of time has had some form of taxation to maintain and sustain itself. Taxes are the very lifeblood of any society. Sometimes it is necessary to adjust taxes for the revenue needed and sometimes that means adjusting them UPWARD. But the nitwit Republicans who signed that pledge think that the only adjustment should be DOWNWARD. Always and only downward.

Bush had no business getting us into two wars. One of them was based on an outright lie; the other one was entirely overblown and unnecessary. His folly and treachery were compounded by even more folly in lowering taxes at a time when more taxes were needed to fund those wars. His lowering taxes while simultaneously engaging in two ill- conceived wars was directly responsible for turning our government surplus into a deficit and then growing our debt more and more over the duration of his presidency.

The editor says that certain tweaks are necessary in order for the TPP to "continue to succeed." That's funny. Please show us how it has succeeded. The Bush tax cuts didn't lead to prosperity for anyone but those at the top, did they? Nothing has ever trickled down, we're still waiting on the "job creators" to create those jobs, and we're still mired in the greatest recession since the Great Depression. Just stubbornly refusing to raise taxes, even slightly, is success enough for you? The only way that tax pledge has "succeeded" is in making fools and simpletons of those traitors who signed it and continue to stand by it.

December 16, 2012 at 1:39 p.m.
Handleit said...

Our representatives are obligated by law to follow the constitution. They are not obligated by law to honor the TPP. I tend to think that Mr. Norquist is trying to hold the signees hostage by blackmailing them with less votes. As I see it blackmail is a violation of the law. Maybe someone should investigate Mr. Norquist and the ATC to see just what is going on behind the scenes. I'll bet there is lots more happening than we hear through the media.

December 17, 2012 at 9:49 a.m.
MasterChefLen said...

Pledge or not, a politician's first priority is to get re-elected. These things are meaningless regardless of political party. Pledge's have the same loyalty affect as an animal in heat.

December 18, 2012 at 10:11 p.m.
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