Friday, December 21, 2012

Let's Close the IRS and Eliminate the 1040

Here is a lateral thinking idea that could make our country great again. Let's get rid of the IRS. We can replace revenue with a national sales tax. This tax could be piggybacked on top of the state sales tax that most states have so we could do away with one entire level of bureaucracy and make the government more efficient.

"No More 1040 Filings"

Think about it. Former Treasury Secretary Paul O'Neill recently said that the cost of administering the IRS alone is over 400 billion dollars a year. Not to mention the annual drudgery of collecting all the data and the expense we as taxpayers do to comply with the Byzantine tax code.

We could have one simple tax, which we pay each time we spend money and eliminate all of the complexity of annual tax filings. We could exempt things like food and medicine to help the economically disadvantaged. The wealthy would pay more since they spend more money. We could keep the estate tax to redistribute money from extraordinarily wealthy people like Warren Buffet and Bill Gates.

If we had a national sales tax, then everyone would contribute to the cost of government and we could end the class warfare that politicians exploit for political gain. We could adjust the amount of the tax on an annual basis to pay for the cost of government. And the best thing is, every time a politician suggested new entitlements, everyone would have to contribute towards their cost. We would have no more "give me this and make the other guy pay for it" proposals.

Government programs cost money, but the current program obscures those costs. A national sales tax (not a value added tax which hides taxes) would force everyone to viscerally feel the cost of government. And only then can we have sensible debate over what social programs we should ask everyone to pay for.
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Tuesday, December 11, 2012

Why Our Government Should Stop Exploiting the Poor

"Challenge" is a lateral thinking tool developed by Edward de Bono that can be used to eliminate wasteful programs. Wouldn't it be great if our elected officials learned how to use it?

One thing I wish I had heard during the election season is what government programs the candidates would kill. Out government is rife with antiquated wasteful programs that suck up resources and benefit no one except the bureaucrats that live on the government dole.

One program that has no beneficial purpose is the lottery. Think about it. Isn't the lottery state-sponsored gambling? Is sponsoring gambling really a necessary function of government?

What does the lottery produce? False hopes and losing lottery tickets.

But the lottery is more than just a frivolous wasteful program. It's a program that is designed to exploit the poor and uneducated. Very few people with math doctorates buy lottery tickets. The people who do have very poor understanding of probability theory. And studies show that they are mainly poor.

We have a county that spends billions of dollars to provide a safety net to protect the poor, so why should we also sponsor a program designed to exploit desperate and uneducated people who do not understand math?

But the money goes to the schools some say and the schools need it. So why don't we legalize prostitution and crack cocaine and give that money to the schools? We can get what we need for the schools by killing wasteful programs (stay tuned to the blog, I am going to name some of them).

"But the money goes to the schools."

We don't do this because prostitution and crack cocaine undermine the fabric of our society. And so does gambling. I have been in poor neighborhoods and seen people who look like they really need a good meal buy 20, 50, sometimes 100 lottery tickets at a time. These are not the recreational players who live in the suburbs that the lottery wants you to believe they are. These are hard core addicts being exploited by a pusher, which unfortunately is our government.

But the lottery creates jobs and we need jobs, but these are government jobs administering a program that produces no goods or services. If the lottery went away tomorrow, many lottery employees would find useful jobs in the private sector creating goods and services that people wanted to buy. Those are the types of jobs we need that make our economy grow. Jobs that produce millions of losing lottery tickets do not stimulate our economy.

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Friday, December 7, 2012

How Can We Make Our Government Work Better?

I love the holidays. During this time of year, I'm reminded of the story of the young bride who was making her first Thanksgiving turkey. She bought a nice turkey and prepared it exactly as her mother had, removing the thighs and drumsticks before cooking the rest of the bird whole. When she placed the fowl on the table for her new husband, a turkey leg man, he inquired as to why she had removed the dark meat before cooking the bird. She replied that she had cooked it exactly as her mother had for every Thanksgiving. That's when her mother explained that the pan she used to cook her turkey was especially small and so she couldn't get a whole bird into the pan. This is why each year the young bride had cooked it in such an unusual way.

The national debate over the fiscal cliff and the pending tax increases reminded me of this story. There is so much waste in our government from doing unnecessary things, that I'm sure we could easily balance our budget just by eliminating unnecessary programs and wasteful policies.

Edward de Bono created a tool called Challenge which was designed to help organizations identify wasteful, unnecessary, or inefficient ways of doing things. I thought that I would apply the tool to show how we could make our government work better.

One of the easiest things our government could do to make life better for its citizens is to eliminate toll booths. Would anyone be sad, if they never had to pay a toll again? Toll booths waste our time, they cause accidents as people fish for coins, and they serve no useful purpose.

Yes, I know that we need the revenues to build and maintain the roads, but wouldn't it be more efficient to collect those revenues as part of the gas tax? Who wouldn't pay a couple cents more at the pump to never have to wait in long lines during rush hour just to pay a toll?

And yes, I know that toll booths employ people, but if a government job can be replaced without any disadvantages to the citizens, then isn't it a make-work job? If we could eliminate all the make-work jobs and get people working in productive jobs, producing goods or services that people wanted to buy, wouldn't that be good for the economy? Why didn't we hear about that during the months leading up to the election?
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