• What do taxes and Buddhism have in common?

    Impermanence is a doctrine of Buddhism. Now it characterizes the U.S. tax system. For more on that, see today’s Wall Street Journal. I post about it here only to highlight a point I raised in my earlier post:

    Deficits tempt legislators to give tax provisions a temporary term to disguise their cost. For proponents of a new tax provision, the strategy is to get a foot in the door by passing it for a year or two, at a seemingly affordable cost, intending to renew it regularly.

    That’s the ten-year budget window in action. We see the same game with the Medicare doc fix. It’s everywhere and it’s irresponsible. Politicians love it. Americans (mostly) don’t get it.

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    • I think it is irrelevant if the public gets it. Because they mostly don’t care. I never saw anyone ask how it was irresponsible to spend 4 trillion but responsible to spend 3 trillion over ten years on tax cuts during the election. No change to the accounting system will fix that problem.

      At the present time, we are able to pay for tax cuts and government services by borrowing money. And we like it. And we are suffering no significant consequences. Yet. Do you seriously think greater disclosure on the credit card bill will stop most people from using it?