Aaron's Real Opinions (Yikes!)

WHAT SHOULD OUR GOVERNMENT BE?

Part 1 of 2:  Viewer Input Matters

A viewer of my television program recently has been sending a number of thought-provoking e-mails discussing his essentially libertarian opinions and detailing his views of how our Government has become too focused on fulfilling the demands of a wide range of special interests.  He also argues America’s work ethic has disappeared and too many people expect their Government to do everything for them.

He rightfully questions many of the actions of Government today and has asked me to discuss some of my views so I thought I would use this column to do that.  As viewers know, I work diligently to stay neutral on my television program and usually avoid taking positions on most issues.  In some cases, I even take positions contrary to my own just so I can engender a better debate.  This column, however, allows me to be more expressive and I will take advantage of that opportunity.

As far as where our Government is today, in my opinion, it is far too large and overreaching.  I believe we need as simple and as small a Government as possible.  Indeed, small is better when it comes to the size of a bureaucracy. 

I also believe Government should do only what is necessary rather than what it believes is desirable.  There is a huge difference between doing what absolutely has to be done and doing what would be good to do.  If the former were the test which was applied to all Government programs, there would be far fewer programs.  We would eliminate vast bureaucracies which now exist to perpetuate themselves.  On the international relations front, we never would have invaded Iraq. 

If we did only what we truly had to do, our Federal Government would be reduced by 25% or more.  This immediately would create a balanced Federal Budget and the opportunity to pay off our outrageous $9 trillion National Debt (both of which could bankrupt the country).

I also believe Government has an obligation to impose the minimum burden on its citizens.  So, for example, I do not support the growing intrusiveness of Government.  What consenting adults do is their business – it is not the business of our Government.  Whenever possible, freedom should be honored or even expanded -- not further restricted.

I do believe in Government which lends a helping hand on occasion to those in need but do not believe in permanent or unjustified Government handouts -- whether personal or corporate.  The problem is too many Americans and many American businesses want handouts and prefer to be subsidized by others.

Simplifying Government often is seen as something which is easy to say but is difficult to implement.  As someone who has seen Washington from the inside. I do not believe simplifying our Government would be difficult to do.  What is missing is the desire and will of the American people.  If we collectively want to change and improve our Government, it can be done.

Next:  The Federal Income Tax As An Illustration Of Simplification

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WHAT SHOULD OUR GOVERNMENT BE?

Part 2 of 2:   The Federal Income Tax As An Illustration Of Simplification

One of the best illustrations for the simplification of Government is the Federal Income Tax system.  It is time to throw out our 55,000-page Tax Code -- which is impossible to follow accurately any more -- and replace it with a Flat Tax.  One plan could have everyone getting a $25,000 standard deduction and up to three $5,000 exemptions.  This means everyone would not pay any federal income taxes on this income.  After that, you would pay a flat 20% on all income, gifts, and things of value received each year. 

There would be no Estate Tax, no accounting games, and we’d get rid of most of the tax accountants and lawyers.  If possible, employment taxes would be merged into the Flat Income Tax so as to make them more progressive.  Today, they are the most regressive taxes we have. 

On the corporate side of the ledger, businesses would simply pay 2% of their gross revenues and the equivalents thereof.  There would be no “accelerated depreciation,” special tax credits, accounting “earmarks” or anything else.  All the time and money wasted on corporate accounting would go out the window.  Businesses could focus on being profitable -- which is what they should be doing in a Free Market system -- and not on all the accounting games so many of them believe they must play.

Penalties should be enormous so as to create a disincentive for all the game-playing, manipulation, and cheating which occurs today.  Corporate executives should have personal liability for the accuracy of their companies’ submissions.  If a Flat Tax is used, this would be a reasonable condition.  In today’s spaghetti-like world of accounting, personal liability, to the extent it exists today, often is an unreasonable demand on executives who cannot possibly know every detail of their company’s accounting and tax documents.

If a true Flat Tax were enacted, individuals and businesses would save billions of dollars in time and money.  They no longer would have to keep track of documents and spend billions of hours on bookkeeping and accounting.  They would be free!

One of the biggest benefits of a true Flat Tax, however, would be for our form of government.  A true Flat Tax would eliminate the extensive involvement of businesses in Government -- leaving the governance of America to its individual citizens.  This is because, with the eliminate of 90% of the Tax Code, businesses would have little incentive to get involved in Government via lobbying and politics because their major activity -- i.e., getting favorable tax breaks -- would be no longer exist.

Now, can we find political leaders with the skill and courage to make changes in our Government?  Unfortunately, to date, neither major party has shown a willingness to even consider such a path.

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