The voices of Tax Policy Center's researchers and staff
President Obama’s promise of transparency in government is a laudable goal after too many years of near-obsessive secrecy by the Executive Branch. Unfortunately, at least when it comes to his tax agenda, the president’s new budget falls far short of that vow.
Too many tax proposals are written in Inside-the-Beltway code. For many provisions, there is no description at all in the 134-page budget. Most can be found only by deciphering the tables in the back. Some items worth hundreds of billions of dollars appear only as mere footnotes. Others are nothing more than numbers in revenue tables. There are no real proposals at all.
Take, for example, Obama’s plan to require companies to purchase government permits to emit CO2. This “cap and trade” proposal would generate a staggering $650 billion in revenues over the next decade. What is the proposal? Based on the budget, I have no idea.
The budget says “the Administration will work expeditiously with key stakeholders and the Congress to develop an economy-wide emissions reduction program….to reduce greenhouse gas emissions approximately 14 percent below 2005 levels by 2020, and approximately 83 percent below 2005 levels by 2050.” Sounds impressive. But how? The budget does not say. Yet, the White House must have something specific in mind, since it assumes precisely $645.711 billion in new revenues through 2019.
Or, consider Obama’s plan for taxing estates. The estate tax, of course, is a complete mess. It is scheduled to expire in 2010 and reappear in 2011. Obama proposes to fix this, as he should. But how? All we get is a footnote on page 121 of the budget: “The estate tax is maintained at its 2009 parameters.”
If you are a tax maven, this makes sense. If you are not, it is gibberish.
Most troubling, there is no cost estimate for this estate tax plan. If it is anything like what he proposed in the campaign, the price tag would approach $300 billion over the next decade. But the budget doesn't say. Rather it rolls the cost in with a permenant extension of other 2001 and 2003 tax cuts. Obama might prefer that voters not know that he’s proposing a $300 billion tax cut for a handful of very wealthy people at a time of huge deficits. But he is, and they should.
In fairness, a new president can’t be expected to present a full-blown budget just weeks after taking office, and Obama promises to have more details sometime in April. But these are far from trivial provisions, and Obama’s staff has been giving them much thought for many months. The estate and energy proposals, for example, were cornerstones of his campaign. In addition, given the budget schedule, it is very likely that this is the document Congress will be working from as it crafts a 2010 fiscal plan.
Obama has been criticized in recent days for his seeming willingness to back away from controversial ideas as soon as critics push back. For instance, he seems ready to abandon his plan to cap the value of itemized deductions at 28 percent. When the details of a budget are as opaque as this, it only adds to the sense that they are ephemeral as well. Now that I think of it, maybe that’s the idea.
Posts and Comments are solely the opinion of the author and not that of the Tax Policy Center, Urban Institute, or Brookings Institution.