When she was still a candidate, Michelle Bachmann pointed out that America can no longer afford the welfare state. Amazingly, I agree with her! It is time we stop giving welfare to the wealthy.
1470 households with an income of $1 million or more in 2000 paid zero federal income tax. Source: the IRS
The average federal income tax rate of the wealthiest 400 Americans is 18%. Source: the IRS
Hedge fund managers and private equity funds pay 15% capital gains rates and have no payroll taxes . Source: the Associated Press
We need a straight tax. That is a tax which is exactly what it says it is. No loopholes, no credits, no legal evasion possible. To those who feel that the government must give assistance to Americans who have children, or buy a home, or have great wealth, I say, OK, give these groups a government grant. Giving them a tax exemption seems cost free when it is not. Giving them a government grant is open and honest in declaring its cost to the revenue stream of the US.
I expect few tax payers who support, say, head of household exemptions would support a government grant for having children! But that is exactly what the exemption is, only it is in disguise. Even fewer would support grants to the wealthy or to huge corporations. That's why we will never get a straight tax.