Tax Ideas

From the readers of the Atlantic. I agree with their main point: simplify, simplify, simplify. I believe in progressive taxation, so I think there should be about 5 different tax rates and very few, if any, deductions. Shoot, I don't care if there are 10 different tax rates. That doesn't matter to me. The main point, is that it should be clear what you are paying, why you are paying it, and what others are paying. With regards to capital gains, I agree the rate should be low, but not for investing other people's money - only your own. People who professionally make money from capital gains - this should get treated like income, since it is income.

Big tax deductions like college tuition credits and mortgage interest deductions are good in principle, but they end up facilitating bubbles in the long run. I'd get rid of them. People will actually be more free if they have less incentives to take on debt. They'll still buy houses with or without the deduction because that's part of the American dream. Or maybe it will go away. So what? I don't care if we become a nation of renters with a lot of cash in the bank. That doesn't seem to me to be a fundamental social problem. I don't think people have any less stake in their community if they rent their places.