One of the few things Democrats and Republicans in Congress agree on in the fiscal cliff negotiations is that taxes shouldn’t rise on the middle class.
But Harvard economist Gregory Mankiw, an adviser to Mitt Romney’s 2012 presidential campaign, takes issue with that conventional wisdom.
“[M]aybe it’s time to reconsider this premise,” he writes in The New York Times. “An unwavering commitment to keep middle-class taxes low could be one reason the political process has become so deeply dysfunctional.”
Editor's Note: Tiny Loophole Found in 70,320 Page IRS Tax Code Could Pay $87,500
Both Republicans and Democrats offer unrealistic solutions for the debt crisis, Mankiw says. Republicans think the sole issue is cutting spending, particularly entitlements, while Democrats place all their focus on increasing taxes for the wealthy.
“[U]nless we scale back entitlement programs far more than anyone in Washington is now seriously considering, we will have no choice but to increase taxes on a vast majority of Americans,” he writes. That could mean higher tax rates, lower deductions, or a new tax.
Marc Thiessen, a fellow with the American Enterprise Institute, makes a similar point in The Washington Post. “It would be better not to raise taxes on anyone, pursue pro-growth tax reform and cut the size of government instead,” he says.
But Americans voted for big government last month. And “the only way to pay for the current expansion of government is to raise taxes on the middle class,” Thiessen writes.
Editor's Note: Tiny Loophole Found in 70,320 Page IRS Tax Code Could Pay $87,500
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