My Bright Idea
RICHARD TRUMKA, PRESIDENT, AFL-CIO
First, let the Bush-era tax cuts for the richest 2 percent expire. Collect a tiny 0.05 percent tax on a broad range of financial transactions. Ask millionaires to pay a surtax on income. Tax capital gains and dividends as ordinary income. And end tax incentives to export good jobs overseas. Sacrifice should start at the top, not with the bottom 90 percent, who have not benefited from the failed economic policies of the past 30 years. Using tax reform as an excuse to reduce rates for corporations and high earners—instead of reducing the deficit—is a sick joke.
ROBERT GREENSTEIN, EXECUTIVE DIRECTOR, CENTER ON BUDGET AND POLICY PRIORITIES
As Reagan economics adviser Martin Feldstein and former Obama budget director Peter Orszag suggest, let all of President Bush's tax cuts expire on time after 2012—not just for those at the top—to shrink projected deficits. Second, reform the tax code by lowering rates and broadening the base in ways that improve economic efficiency, increase progressivity, and raise revenue in the context of a broader deficit-reduction package—one with responsible savings in discretionary and mandatory programs, including reforms to slow the growth of costs throughout the U.S. health-care system.
DANIEL DiMICCO, CEO, NUCOR
One proposal currently making the rounds is to allow American multinationals to repatriate offshore earnings—estimated at over $1 trillion—back to the U.S. virtually tax-free. Critics are worried the proposal won't result in economic stimulus. But we could guarantee a positive economic benefit if that money coming back went into infrastructure bonds. Updating our crumbling infrastructure would create jobs and keep us economically competitive. Each $1 billion spent on infrastructure creates 35,000 jobs. Companies would be able to draw that money back over time, once the economy has recovered and the government has recouped the cash in tax revenue.
GLENN HUBBARD, DEAN OF COLUMBIA BUSINESS SCHOOL
Replace our current tax system with a broad-based, proportional consumption tax, with an exemption and refundable credit for low-income households. During a transition: Reduce current tax expenditures on health care and housing and use revenue from a consumption tax to decrease the current income and payroll taxes. A caution: The fate of the Tax Reform Act of 1986 teaches us that "broaden the base, lower the rates" within the income tax isn't sufficient, as keeping complexity and distortions at bay has proven difficult.