In his convention speech on Sept. 2, President Bush said that one of his key second term goals is creating a simpler, fairer, pro-growth tax system. In a White House fact sheet, he said that he would issue an executive order creating a bipartisan panel that will report to the treasury secretary early next year on options for tax reform. As a long-time supporter of tax reform, I am reluctant to throw cold water on this effort, but I am pessimistic that anything meaningful will be accomplished by it.
First of all, the record of such commissions is not good. I've got a whole shelf full of reports from various presidential, congressional and high-level private commissions that were just a waste of time for everyone involved with them.
In my experience, commissions of this sort are mostly useless unless those appointing them already know what they want them to report at the end of the day. If a president doesn't know what he wants in the way of tax reform, it is unlikely that a commission is going to tell him -- especially if it has members of both parties involved.
Commissions may serve some value as marketing tools if a president is looking to build support for something he has already decided to do. But the value of this is so small, it is probably not worth the effort.
In any case, commissions only work if the members have a gun to their heads, where they have to come to an agreement or something terrible will happen. In this respect, the Social Security Commission in 1983 chaired by Alan Greenspan is the only one I can think of that was ever really "successful."
I think Bush would have been better advised just to ask the Treasury Department for a report, as Ronald Reagan did in 1984. Its staff is well aware of every serious tax reform option that has ever been put forward and is fully capable of giving him what he wants within the time period he has specified.
By contrast, it will take at least a year for a bipartisan commission to get up to speed, hire staff, hold hearings, deliberate and write a report. Most likely, at the end of the day, the Republicans will all endorse something like a flat-rate consumption-based tax system and all the Democrats will decry it as a give-away to the rich that will oppress the poor. What is the point?
Bruce Bartlett is a former senior fellow with the National Center for Policy Analysis of Dallas, Texas. Bartlett is a prolific author, having published over 900 articles in national publications, and prominent magazines and published four books, including Reaganomics: Supply-Side Economics in Action.
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