SOTU 2012: The Tax Loophole Jump
January 26, 2012 Leave a comment
There were some nice things about Tuesday’s State of the Union Address: Representative Gifford’s recovery, the accomplishments of our awesome Navy SEALs, and Mitch Daniels’ well-spoken and clever GOP response. And there were some not so nice things.
Looking at the fiscal picture, President Obama’s speech boiled down to two proposals: shuffling business tax credits and asking for more money on things we already spend a lot on. Among the various behaviors the President aspires to manipulate through a fresh scrambling of our already deeply convoluted tax code: who businesses hire, how much they pay those employees, what manufacturers make, and where they make those things. Has the White House not gotten one of those memos on tax simplification? What ever happened to the recommendations from the Simpson-Bowles report they commissioned? All of the new tax credits (read: loopholes) will only distort market behavior. And market distortions are “what got us into this mess.”
Then there are the new outlays he requested. First, to create a new bureaucracy, the Trade Enforcement Unit. I think he is going for the Jack Bauer vote by calling it a unit, as in “Counterterrorism Unit (CTU).” Its a worthy cause, but can’t it be done by retasking existing agencies? Next on the list is money to transform community colleges into “community career centers.” I don’t know what they were before if not that! Just a place to find a date for Friday night? Finally, he asked us to fork more money over for teachers. But it seems like school voucher programs don’t count. Democrats only accept more money for education when it doesn’t threaten unions.
I don’t think our President has managed to outdo himself in 2012. Last year’s “Winning the Future” (WTF) theme with $53 billion for high speed rail projects is just too tough to beat. And that outlandish record will hopefully stand if this State of the Union address is President Obama’s last.