Mitch Daniels's Governing Plan

by Pejman Yousefzadeh on September 19, 2010


Another thing I am late to; it must be an exceedingly good plan, seeing as how it has Ezra Klein’s grudging respect, along with assurances that the Obama Administration wants to implement much of the Daniels plan, and sorrowful headshaking over the fact that certain anonymous Republicans do not support a payroll tax holiday.

The only thing that I would add to Daniels’s list of offsets to a payroll tax holiday is a VAT, which again, is a very non-distortionary tax that will scoop up gobs of revenue with which to bring down the deficit and the debt, and which will not slow down economic growth nearly as much as a payroll tax holiday would speed it up. Another reason to implement a VAT for additional revenue is, of course, because impoundment and budget cuts can be politically painful, and given our current sorry fiscal state, any impoundment or cuts will be exceedingly painful.

  • Fred Chittenden

    I'm all for a VAT that takes effect the year following the repeal of the 17th Amendment that allows income taxes on individuals and corporations.

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