December 8, 2009
At Brookings today, President Obama laid out his vision for Stimulus II. At first glance, this seems to be a collection of odds-and-ends, only some of which will help the economy grow and create jobs.
December 3, 2009
Though it has attracted little attention, a bill called the CLASS Act has the potential to fundamentally change the way we think of government social policy. It also runs the risk of becoming yet another costly unfunded entitlement. Congress will decide over the next few months. The Community Living Assistance Services and Supports Act would create a new national voluntary long-term care insurance program to help pay for the personal care of both the frail elderly and younger adults with disabilities. It would provide a basic lifetime cash benefit funded through an optional payroll deduction.
December 3, 2009
One arguably good thing about the financial crisis is that it has broadened public understanding of the global financial system. One bit of exotica to grace the front pages of our newspapers is the credit default swap (CDS). These swaps brought insurance giant AIG to its knees, and precipitated a $100 billion U.S. government bailout of the company. More recently, it has been reported that hedge fund manager John Paulson made more than $3 billion using CDSs to bet against subprime mortgages. These things are obviously very powerful.
December 1, 2009
Nothing I have written in more than two years at TaxVox has attracted more attention than my August, 2009 piece on the Happy Act. This bill, sponsored by Representative Thaddeus McCotter (R-MI), would allow people to deduct up to $3,500 from their taxes to subsidize the cost of, no kidding, pet care.
November 30, 2009
On Black Friday, the New York Times published an editorial praising a New York state law requiring on-line retailers to collect applicable state sales tax on all purchases. The requirement, in abeyance pending court challenges, makes a lot of sense. Yet history doesn’t bode well for the new law. And states are likely to continue to lose precious revenue as on-line sales grow.
November 30, 2009
The White House is delaying the report of its tax reform panel until “after the holidays.” According to a blog posting by top economic adviser Austan Goolsbee, the President's Economic Recovery Advisory Board is delaying the report so it can review new proposals for reform. However, the panel still plans to release only what board chairman Paul Volcker calls “an almanac” of reform ideas. It will not endorse specific proposals or make any recommendations. The report had been due on Friday.
November 27, 2009
The Pew Center on the States has done a good job documenting the dysfunction in current state budgets. “Beyond California: States in Fiscal Peril” uses both political and short-term economic variables to rank the states. And it shows that while California gets all the attention because its numbers are so big, many states across the country face their own severe financial problems. Some are suffering from bad economic fundamentals (think Michigan). Others are struggling with politics (hello, Arizona).
November 24, 2009
“Democrats health bills depend on forcing individuals to buy insurance or face severe fines or imprisonment.” George Will, Nov, 19, 2009 Before we spin off into a Thanksgiving reprise of last summer’s death panel lunacy, let’s be clear. Nothing in Will’s statement is true.
November 20, 2009
IRS Commissioner Doug Shulman reports that nearly 15,000 taxpayers turned themselves in under the service’s amnesty program for people who had failed to report overseas bank accounts on their federal income tax returns. A major inducement was the government’s settlement with Swiss bank UBS, under which the bank promised to hand over information on about 4,500 American account owners. More than 80 percent of the amnesty filings came after the IRS announced that settlement.
November 19, 2009
Senate Majority Leader Harry Reid (D-Nev.) has pulled together a health bill that relies on three major revenue sources (and many smaller ones) to help support the cost of new insurance subsidies for those with low- and moderate-incomes.