Thursday, August 26, 2010

Top Republican talks about tax expenditures

"Spending programs disguised as tax breaks." That's how columnist Ruth Marcus defines tax expenditures. It lines up nicely with LFT's contention, based on research by the Louisiana Budget Project, that the $7 billion worth of deductions and credits that Louisiana spends every year ought to be reconsidered in light of our budgetary mess.

It's to be expected that a writer for the Washington Post would take a progressive position on tax expenditures. What's surprising is that the source of her column is Congressman John Boehner of Ohio, Minority Leader of the House and one of the most conservative Republicans in Congress.

While tax expenditures cost Louisiana $7 billion per year, they cost the federal government $1.2 trillion per year.

And like in Louisiana, once these expenditures become enshrined in law, they are seldom reconsidered. Even if their original purpose has been satisfied, and even if they have become a net drain on the economy.

In this excerpt from Marcus' column, the voice of reason is loud and clear, and could have come straight from the Louisiana Federation of Teachers' position on tax expenditures:

“We need to take a long and hard look at the undergrowth of deductions,
credits, and special carve-outs that our tax code has become,” Boehner said in his speech
to the City Club of Cleveland. “And, yes, we need to acknowledge that what
Washington sometimes calls ‘tax cuts’ are really just poorly disguised spending
programs that expand the role of government in the lives of individuals and

Boehner cited the “tax extenders” bill now
making its way through Congress. “There’s everything in this bill: the research
and development tax credit, special expensing rules for the film industry, an
extension and modification of a tax credit for steel industry fuel, the mine
rescue team training tax credit, and tax incentives for investment in the
District of Columbia,” he said. “Are they worth it? Many are. But we just go
ahead and extend all of them temporarily -- and usually right at the last minute
-- so Washington can continue pandering to the loudest voices instead of
implementing the best ideas.”

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