Jerks and Taxes

Those of you who are old enough or just Steve Martin fans might remember his movie, “The Jerk”. It was a stupid, but in my opinion, very funny movie. In one scene Steve Martin’s character, Navin R. Johnson, is totally excited when the new phone book is delivered (yes, phone books used to be a thing). He jumps around yelling “The new phone book's here! The new phone book's here! ….”. And then finds his name in the phone book and proudly points to it commenting that he is now somebody. Spoiler alert, a nut job also randomly finds his name in the phone book and…well…watch the movie.

The is sort of how I feel about the new tax plan. The jerks on the right are excited about their new tax plan and the jerks on the left hate it because they are bound and determined to hate anything the right wants to do. So with Republican majorities the Senate passed their version and the House passed their version. We don’t know exactly what the final version will look like, but we have a pretty good idea. Maybe it’s better than what we have now. There will be winners and losers, but “tax reform” it is not. Not even close.

The monster that is our tax code scares the hell out of politicians and even most economists aren’t really sure what to do about it. They have their ideal models and how things should be assuming this, that and the other. But, considering where we are and how money is earned, spent, saved, invested, taxed and given away...how much do they rock that boat and who wants to do the rocking?

For me the elephant in the room remains government spending and the way we just keep adding to the national debt. The “new tax plan”, whatever its final version, will not fix this problem. As I understand it, they are betting on GDP growth plus they have baked in some “adjustments” in the future which will increase taxes for certain groups. So over time we begin to chip away at the debt. That’s just plain bad management. But, if you can print your own money, why not kick the can down the road? And if getting re-elected is more important than doing the right and responsible thing, why not kick the can down the road?

The New Tax Plan is here! The New Tax Plan is here! And the Jerks are still in charge.

“Page 73 - Johnson, Navin R.! I'm somebody now! Millions of people look at this book every day! This is the kind of spontaneous publicity - your name in print - that makes people. I'm in print! Things are going to start happening to me now.” - Steve Martin’s character from the movie The Jerk.