On Our Backs, Ctd.

by Ramesh Ponnuru

Michael, I know that you weren’t “arguing for the Perry plan per se”–you set forth your own proposal and praise various other plans. Am I wrong, though, to read your column to mean that Perry’s plan is a step in the right direction? (Your first sentence calls Perry’s flat tax “the only kind of income tax that makes any sense.”) If your concern is that not enough people pay income tax, you should dislike his plan.

You are quite right to say that liberals often try to have it both ways on the payroll tax: treating it as a tax during arguments about federal tax progressivity but pretending it is a contribution to an insurance program during arguments about Social Security. But the way to resolve this contradiction is to see the entitlements as what they are (government transfer programs) and payroll taxes as what they are (taxes). Which makes people who pay payroll taxes correct in seeing themselves as taxpayers.

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