I’m sure that political reality did more than I did to persuade the administration to drop the idea of comprehensive tax reform in favor of incremental policies such as exempting investment from multiple layers of taxation. Karl Rove knows perfectly well that expanding 401(k)s and IRAs got more than 400 votes in the House in 2001–and I suspect that he also knows that the tax break for employer-provided health insurance is not going to be abolished. (The administration’s backing off, I suspect, has not yet stopped.)
As for Salam’s own tax ideas: I think he is right to want a pro-family tax policy (or at least one that is less anti-family than the current one); I think he is wrong to join John Mueller in setting up investments in families and investments in stocks as each other’s principal rivals. We should cut taxes on both kinds of investments. There are plenty of other taxes that could be raised to compensate. Even better, there is plenty of spending that could be cut.