Saturday, June 5, 2010

Political Reality Bites Political Scientist, Part 3

The flat tax remained a hot issue through June 1986, when President Reagan’s Tax Reform Act of 1986, with two rates of 15% and 28% (instead of the flat 19% rate we proposed) was enacted into law. Bob and I testified singly and jointly at other Congressional hearings.

One was held by the House Ways and Means Committee under the chairmanship of Dan Rostenkowski. The hearing scheduled two panels, the first of Congressman Jack Kemp who presented the Kemp-Kasten bill, and the second of four academics including me.

Kemp began by praising all the committee members, and each of them praised him in turn when making opening statements and asking questions. The panel was a lovefest, not an exchange of views on tax reform. Kemp’s panel went well over the scheduled time. When it finished and we four academics were seated at the table with name cards and cups of ice water, the chairman stated that we only had fifteen minutes in all to make our statements, He assured us, however, that our full statements would be read into the Congressional Record and that we would have the opportunity to answer in writing any questions asked by committee members. Virtually no committee member remained in the room to hear our condensed remarks or discuss any of our proposals for tax reform, nor did any follow up with questions. More disillusionment.

Shortly thereafter the Senate Finance Committee held hearings on tax reform. My nemesis, Bill Bradley, again took the flat tax to task. He misquoted several sections in the book Hall and I had written. I asked for a chance to respond to clear up the misinterpretation. His reply was a resounding “NO.” That was that.

I presented written testimony at several other hearings convened by related subcommittees of the Congress, all of which were faithfully reprinted in the Congressional records. But as I had come to appreciate, the hearings were more about the partisan views of Members of Congress, rather than learning experiences that would enable them to craft good legislation.

Congressional hearings, at least those involving federal taxes, are show trials to benefit Members of Congress. Insofar as discussing the central or finer points of the flat tax or tax reform more generally, the Congressional hearings I witnessed first hand were largely charades, exercises in Kabuki theater.

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