No one's going to like this - but the solution is taxing the middle 1/3. Note I didn't say taxing them more - because, right now, they don't get taxed. They pay SS and FICA but they don't pay income taxes. As a matter of fact - the bottom 50% don't pay them. Yet they they use the resources, vote, and expect a voice.
If you got the the group form bottom 15% to 50% to pay just a 5% tax rate, it would generate a TON of money.
I wouldnt raise tax rates for this group. Nor would I for the top income earners. But I would change some tax expenditures that largely benefit this group like the one mentioned in the article(healthcare premiums paid for by employers are included in income). Capping deductions affects the top 15-20%. Doing things like this affects everyone, and disproportionately affects the middle 3rd. This one has the side benefit of making our healthcare system more efficient. More on that in future articles. People are shocked that our system is much more progressive than most Europeans counties. Mainly due to their long time use of the VAT.
Love the point about the role of election reform. Such an important lever to pull.
With respect to tax revenue, I’ve often felt that tax evasion is a massive leak of revenue. Simplifying the tax code would make filing and auditing a lot easier and catch those who are deliberately or inadvertently underpaying their share. The ROI on IRS spending seems very high. Your views?
Also, surprised to see no specific mention of carried interest reform for PE and VC types. Did you look at the upside for killing that loophole?
The PE thing is actually in there! Peterson Institute values it at around $1.2B per year. I would have thought higher. Alone, that’s not much. With the hundreds of other tax expenditures, it’s material.
Most important change you suggested might be the reforming of the electoral process with ranked choice voting. What would it take to get that broadly accepted in more states?
Maybe the next question for the discussion here or, as a new topic for PW, is how to effectively build enough support and engagement to start implementing ranked voting here in MA!
I think like any social change it might take a real campaign to increase awareness and the benefits. This goes beyond a few newspaper articles. It will take active promotion on social media. It will take active experiments in multiple town elections to build hands on awareness and it will take building trust that this works and is not subject to fraud!
What action do you think will make rank choice voting happen in Massachusetts?
No one's going to like this - but the solution is taxing the middle 1/3. Note I didn't say taxing them more - because, right now, they don't get taxed. They pay SS and FICA but they don't pay income taxes. As a matter of fact - the bottom 50% don't pay them. Yet they they use the resources, vote, and expect a voice.
If you got the the group form bottom 15% to 50% to pay just a 5% tax rate, it would generate a TON of money.
I wouldnt raise tax rates for this group. Nor would I for the top income earners. But I would change some tax expenditures that largely benefit this group like the one mentioned in the article(healthcare premiums paid for by employers are included in income). Capping deductions affects the top 15-20%. Doing things like this affects everyone, and disproportionately affects the middle 3rd. This one has the side benefit of making our healthcare system more efficient. More on that in future articles. People are shocked that our system is much more progressive than most Europeans counties. Mainly due to their long time use of the VAT.
Love the point about the role of election reform. Such an important lever to pull.
With respect to tax revenue, I’ve often felt that tax evasion is a massive leak of revenue. Simplifying the tax code would make filing and auditing a lot easier and catch those who are deliberately or inadvertently underpaying their share. The ROI on IRS spending seems very high. Your views?
Also, surprised to see no specific mention of carried interest reform for PE and VC types. Did you look at the upside for killing that loophole?
The PE thing is actually in there! Peterson Institute values it at around $1.2B per year. I would have thought higher. Alone, that’s not much. With the hundreds of other tax expenditures, it’s material.
David,
We are in agreement on this one. Thank you.
Most important change you suggested might be the reforming of the electoral process with ranked choice voting. What would it take to get that broadly accepted in more states?
Very hard. Went 1 for 7 in 2024. Keep banging it. Let’s get it done in MA!!!
Maybe the next question for the discussion here or, as a new topic for PW, is how to effectively build enough support and engagement to start implementing ranked voting here in MA!
I think like any social change it might take a real campaign to increase awareness and the benefits. This goes beyond a few newspaper articles. It will take active promotion on social media. It will take active experiments in multiple town elections to build hands on awareness and it will take building trust that this works and is not subject to fraud!
What action do you think will make rank choice voting happen in Massachusetts?
I’d like to see you add campaign finance reform to the tools to empower centrist voters.
Please try to refer Purple Wayz readers to other substacks of a similar hue, as the “Bracket’” piece consisted of material with a pretty red tilt.
Thanks for bringing out attention to Jessica Reidl’s important work.
Great article on the 10 myths, so nice to see real evidence that politicians don’t seem to pay attention to 😫