The Benefit and The Burden: Tax Reform-Why We Need It and What It Will Take [Hardcover]

Bruce Bartlett (Author)

Book Description

Release date: January 24, 2012

A thoughtful and surprising argument for American tax reform, arguably the most overdue political debate facing the nation, from one of the most respected political and economic thinkers, advisers, and writers of our time.

The United States Tax Code has undergone no serious reform since 1986. Since then, loopholes, exemptions, credits, and deductions have distorted its clarity, increased its inequity, and frustrated our ability to govern ourselves.

At its core, any tax system is in place to raise the revenue needed to pay the government’s bills. But where that revenue should come from raises crucial questions: Should our tax code be progressive, with the wealthier paying more than the poor, and if so, to what extent? Should we tax income or consumption or both? Of the various ideas proposed by economists and politicians—from tax increases to tax cuts, from a VAT to a Fair Tax—what will work and won’t? By tracing the history of our own tax system and by assessing the way other countries have solved similar problems, Bartlett explores the surprising answers to all of these questions, giving a sense of the tax code’s many benefits—and its inevitable burdens.

Tax reform will be a major issue debated in the years ahead. Growing budget deficits and the expiration of various tax cuts loom. Reform, once a philosophical dilemma, is turning into a practical crisis. By framing the various tax philosophies that dominate the debate, Bartlett explores the distributional, technical, and political advantages and costs of the various proposals and ideas that will come to dominate America’s political conversation in the years to come.

Editorial Reviews

Review

"A lucid analysis... a provocative book... remarkably successful in interweaving the underlying economics of the US tax system with the political choices that have made it what it is."—Financial Times

"Today we’re living in a country deeply divided between winners and losers. Nowhere is that more evident than in our tax system—so distorted by loopholes, exemptions, credits, and deductions favoring the already rich and powerful that it no longer can raise the money needed to pay the government’s bills. Among the people who saw this crisis coming was the conservative economist Bruce Bartlett... The Benefit and the Burden is a layman’s guide through the jungle of a tax system that, thanks to rented politicians and anti-tax ideologues like Grover Norquist, enable the one percent to make off like bandits while our national debt soars sky-high."—Bill Moyers

“[Bartlett’s] analysis of tax burdens and policies in modern times is essential reading for anyone following the present debate about income inequality and taxation.”—Worth

"For a vivid picture on how evolving tax laws have wrecked America's fiscal standing, consult Bruce Bartlett's new book."—Froma Harrop, The Providence Journal

"A great introduction for anyone who doesn't really know much about the U.S. tax system and wants to learn the basics. It's clear, short, and a quick read."—Kevin Drum, Mother Jones

"If Obama wants to win this election, he needs to embrace radical tax reform. The shape and structure of sane reforms is already out there, as Bruce Bartlett explains."—Andrew Sullivan, The Daily Beast

"[Bartlett] writes beautifully and seems to have no trouble avoiding getting caught up in the many complexities of tax policy."—Len Burman, Forbes and Professor of Economics at Syracuse

"In a political system beset by ignorance and misinformation, delivering basic information to interested citizens is a worthy goal. And Bartlett does it very well."—Joseph J. Thorndike, Tax Notes

“[Bartlett’s] balanced, well-researched primer on America’s tax system... is a refreshing entree to a difficult subject. The book’s no-nonsense approach to tax policy proves surprisingly engaging.”—The Economist

"Bruce Bartlett has waded into the debate on tax policy with a thoughtful argument for the necessity of reform."—Tom Pauken, The American Conservative

About the Author

Bruce Bartlett is a columnist for the Economix blog of The New York Times, The Fiscal Times, and Tax Notes. Bartlett’s work is informed by many years in government, including service on the staffs of Congressmen Ron Paul and Jack Kemp and Senator Roger Jepsen, staff director of the Joint Economic Committee of Congress, senior policy analyst in the Reagan White House, and deputy assistant secretary for economic policy at the Treasury Department during the George H.W. Bush administration. Bartlett lives in Virginia.

See all Editorial Reviews

Product Details

• Hardcover: 288 pages
• Publisher: Simon & Schuster (January 24, 2012)
• Language: English
• ISBN-10: 1451646194
• ISBN-13: 978-1451646191
• Product Dimensions: 9.3 x 6.2 x 1.1 inches
• Shipping Weight: 1 pounds (View shipping rates and policies)
• Average Customer Review: 4.4 out of 5 stars  See all reviews (31 customer reviews)
• Amazon Best Sellers Rank: #222,210 in Books (See Top 100 in Books)
  • #55 in Books > Business & Investing > Economics > Public Finance

More About the Author

Bruce Bartlett is a columnist for The Fiscal Times, an online newspaper covering public and personal finance, and Tax Notes, a weekly magazine for tax practitioners and policymakers. He also contributes a weekly post to the Economix blog at the New York Times, and writes regularly for the Financial Times. Bartlett was previously a columnist for Forbes magazine and Creators Syndicate. His writing often focuses on the intersection between politics and economics and attempts to inform politicians about economics, and economists about the current nature of politics.

Bartlett's work is informed by many years in government, including service on the staffs of Congressmen Ron Paul and Jack Kemp and Senator Roger Jepsen, as executive director of the Joint Economic Committee of Congress, senior policy analyst in the Reagan White House, and deputy assistant secretary for economic policy at the Treasury Department during the George H.W. Bush administration.

Bruce is the author of eight books including the New York Times best-seller, Impostor: How George W. Bush Bankrupted America and Betrayed the Reagan Legacy (Doubleday, 2006). His last book was The New American Economy: The Failure of Reaganomics and a New Way Forward (Palgrave Macmillan, 2009). His new book, The Benefit and the Burden, will be published by Simon and Schuster in 2012 and is a history and review of issues related to tax reform.

Most Helpful Customer Reviews

27 of 27 people found the following review helpful

4.0 out of 5 stars Concise intro to an important topic February 14, 2012

By R. Ricks

Format:Hardcover|Amazon Verified Purchase

A concise introduction to the current US tax system and the various proposals for tax reform. (Note that this is a public policy book, not a "how to" manual for taxes.) Explanations are rather spare and unelaborated; I had to re-read a few passages to get the gist of what he was saying. The author won't win any prizes for his prose, which is straightforward but dry, yet he writes with authority and is even-handed. He worked for Republican congressmen in the Reagan-Bush I era, but he has no affinity for the current Republican orthodoxy, especially its Tea Party strains. On the whole, I came away feeling much better informed about tax policy and, I admit, frustrated by the political obstacles that stand in the way of meaningful (and needed) reform.

39 of 43 people found the following review helpful

5.0 out of 5 stars A great book for those that sleep on hearing tax policy February 11, 2012

By AZ Dry Humor

Format:Hardcover|Amazon Verified Purchase

Bruce Bartlett's book "The Benefit and The Burden" is a good book for those of us that want to stay informed, but fall asleep the minute the discussion turns to Federal tax and spend policies. Written by a senior economist in the Reagan and Bush administrations it is surprisingly fair in pointing out where our politics has not been helpful in the debate on federal taxes and spending. Most of the explainations of economics and tax policies are clear and easy to understand without a degree in finance required. As a political independant I would love it if every voter read this before the 2012 election.

65 of 77 people found the following review helpful

5.0 out of 5 stars Excellent - January 24, 2012

By Loyd E. Eskildson HALL OF FAME

Format:Hardcover

Bruce Bartlett's "The Benefit and the Burden" provides an easily readable, credible, and useful overview of American federal taxes and their impact. Bartlett also provides a number of improvement suggestions based on well-thought-out logic rather than useless ideology.

Bartlett begins by pointing out that close to half of all tax filers either pay no federal income tax or get a refund - an obvious built-in incentive for expanding government spending. Then he covers recent macro-level changes, starting with Clinton's raising the top rate from 31% to 39.6% in 1993. Bush I had previously raised it from 28%, his 'No new taxes' pledge notwithstanding. Clinton's rate increase, however, was also accompanied by also increasing the threshold from $86,500 to $250,000. Clinton's actions were followed by rapid economic growth, declining Federal outlays (from 22.1% of GDP to 18.2%), and a 4.7% GDP deficit becoming a 2.4% surplus - all contrary to the dire predictions of opposing Republicans. Then came the Bush II tax cuts and a 3.2% GDP deficit, sluggish economic growth, and The Great Recession.

Many complain that America's taxes are too high (uncompetitive), and headed for European levels. Bartlett shows that neither assertion is based on facts. In 2008 the average total tax burden in OECD nations was 34.8% of GDP, vs. 26.1% in the U.S. Denmark topped the list at 48.2%, and Sweden was close behind at 46.3%. Belgium, Italy, and France were also close, and above the OECD average.... Explanations for high European tax rates include 1)greater homogeneity (welfare is seen as helping people like themselves, not 'those others'), extra benefits provide Europeans (all European nations provide health insurance through their government), and a preference for simpler direct government spending, instead of tax credits as in the U.S.

At first glance, the U.S. has the lowest top tax rate (43.2% - includes an estimate for state taxes), vs. Denmark with the highest (62.8%). However, the highest U.S. rate takes effect at the highest multiple of average income (9.6X), vs. Denmark (1.0X). Thus, other OECD nations' taxes are flatter, and less progressive than in the U.S. Foreign nations also rely more on consumption taxes - 29.9% of total taxes in OECD nations, vs. 14.4% in the U.S. Property taxes also contribute a larger U.S. share - 12.1%, compared to 5.4% in the OECD.

Conservatives contend that low taxes bring greater growth. Analysis of real GDP growth/capita from 1979 - 2010 does not bear that out. Ireland had the greatest annual growth rate (3.2%/year), and slightly higher taxes/GDP (28.4%) than the lowest growth state, Italy (26.1% taxes/GDP). Intermediate-growth ranked states ranged from 46.7% (Sweden - #10) to 22% (Spain - #5). European states spend less on defense, more on public infrastructure and transportation, less on income transfers to the elderly.

Nordic nations tax income at lower rates than labor, like the U.S. OECD and other major nations tax environmentally harmful activities more than does the U.S. - 2.2% of average GDP for OECD nations, 0.8% for the U.S.

Bartlett also points out that the U.S. taxes its citizens abroad - the only nation to do so.

Directly comparing taxes from one nation to another is made difficult by varying policies. For example, Medicare Part B premiums ($61 billion in 2010) are shown in our budget as reducing spending, not as revenues. Overall, such practices amount to another 4% of GDP for the U.S. - $600 billion in 2010. We also have tax deductions and credits that equate to spending programs. The Earned Income Tax Credit is an example - it provide about 80% of its benefit via refunds. Child care credits are another example. Bartlett says both have become targets for fraudulent claims.

Concern over tax equity has declined as deficits have grown, and after Cheney's claim that 'Deficits don't matter.'

Net social spending as a share of GDP in 2005: France - 34%, U.K. - 30%, U.S. 27%, Japan and Canada - 23%, Korea - 11%. (These data include mortgage interest and health care deductions.)

Charitable contributions generated a $53 billion revenue loss in 2012, mostly from the upper-income. Another questionable loss - allowing the Heritage and other foundations tax-exempt status.

Unreported income in the U.S. for 2005 is estimated at $1.3 trillion. Read more ›

20 of 22 people found the following review helpful

5.0 out of 5 stars Michael Bindner's review (posted for my husband) January 24, 2012

By Moira Bindner

Format:Hardcover

In The Benefit and the Burden, Bruce Bartlett takes the reader on a journey from the basics of tax policy to the prospects for the future of tax reform, all from an insider's perspective and as one of our nation's most respected tax policy journalists. This book is useful to anyone who wants to understand tax policy and reform, from the interested citizen to congressional and administration staff to the journalist who needs to understand the issues quickly. Bartlett predicts when reform will likely occur, which I have to agree with, given the case he makes, although I can envision one scenario where reform might come more quickly than we expect. You should buy the book to see how this all might end.

5 of 5 people found the following review helpful

5.0 out of 5 stars Fantastic and accessible February 27, 2012

By Jessamyn Conrad

Format:Hardcover|Amazon Verified Purchase

I rarely write reviews for books I read but I thought this one needed more praise. I got the book after I saw Bartlett on the Daily Show and was impressed by his total lack of craziness. The book is really interesting, rational, and even-handed and totally accessible to a lay reader. It's not like reading the tax code. I'm not sure what I would call the author, politically, and that is extremely refreshing because it's hard to find information on policy that's not skewed by a strong political orientation. Usually you have to read between rhetorical lines and though the author has and gives his own opinions (and thank you, WHY don't we have a VAT??) he talks about a lot of other opinions and ideas, too. I kind of wish this guy ran part of the economy, but I'm awfully glad he wrote this book. It's really a must for anyone with even a glancing interest in the economy.

3 of 3 people found the following review helpful

4.0 out of 5 stars Accessible, Even-Handed and Enlightening Book April 1, 2012

By J. Gomez TOP 500 REVIEWER

Format:Kindle Edition|Amazon Verified Purchase

The Benefit and The Burden: Tax Reform Why We Need It and What it Will Take by Bruce Bartlett

"The Benefit and The Burden" is a very solid, no-nonsense book that makes the compelling case for tax reform and what it will take to do so. In an even-handed, non-partisan manner Bruce Bartlett skillfully makes the US Tax System accessible to the masses. Bartlett's background in government economics and having worked on the staffs of Congressmen Ron Paul and Jack Kemp and as deputy assistant secretary for economic policy at the Treasury Department during the George H.W. Bush administration, serves him well to write such a topical and important book. A book about tax reform can be dry and tedious to read at times but Bartlett's lucid and concise prose makes this book a worthwhile read. This educational 288-page book is composed of twenty-four chapters and broken out into the following three parts: Part I. The Basics, Part II. Some Problems, and Part III. The Future.

Positives:
1. Well-written, and exhaustively-researched book that is accessible to the masses.
2. No-nonsense, lucid and concise prose. The author writes with conviction and expertise.
3. Does a very good job of keeping the chapters short and intelligible.
4. Educational and enlightening book that provides a basic foundation in understanding the US Tax System.
5. Despite Bruce Bartlett's work in Republican administrations, he is even-handed and treats this topic with utmost respect and care. He does not shy away from criticizing any party.
6. In general, the author provides persuasive arguments for his thesis.
7. Good use of charts to illustrate points.
8. The author tell you his biases right up front.
9. A brief history of taxation.
10. Explains the tax system process....
11. Generally does a good job of defining terms and provides simplified examples.
12. Does a very good job of differentiating between conservatives and liberals regarding tax reform.
13. Reality versus perceptions.
14. Some eye-opening facts, "A 2011calculation by the CBO concluded that the Bush tax cuts reduced federal revenues by $2.8 trillion between 2002 and 2011".
15. The factors that contribute to economic growth. The purpose of investments.
16. The basic ways that that income can be taxed.
17. Distinctions between U.S. and foreign tax systems.
18. Tax ideas from other countries. Interesting.
19. The impact of tax credits.
20. Understanding social welfare and how we compare to other countries.
21. The goals of tax reform.
22. Heath care policies.
23. Real estate and tax policies.
24. The impact of state and local taxes, surprisingly educational.
25. Charitable contributions.
26. The special problems of capital gains.
27. The even bigger problem of corporations as it relates to tax policy.
28. The critical goal of tax reform, how to improve the tax collection system. Interesting cases.
29. A look at flat tax and the implications.
30. A brief summary of tax reform proposals.
31. The problem of debt.
32. Value-added tax (VAT), a look at this interesting consumption tax. Arguments for and against it.
33. The future of tax reform.
34. A good summary of what the author would like to see happen and what he feels is the best scenario for tax reform.
35. Tea Party criticism.
36. The author provides extensive reading material and I mean extensive.

Negatives:
1. Despite the best intentions tax reform can be dry and tedious.
2. Let's face it economics is a complex topic and some concepts will go over the heads of many readers.
3. I would have liked an analysis of entitlement programs.
4. A breakout of the budget by categories and an analysis would have been welcomed.
5. A glossary of terms would have added value.
6. A little humor never hurts.
7. In order to keep the book to a manageable level, some topics were sacrificed.
8. No direct links in Kindle.

In summary, this was an educational and informative book. If you are interested in learning the basics of the US Tax System and tax reform this is a good book to start. Bartlett provides a plethora of resources for those who want to sink their teeth further into this topic and the information that he does provide is solid and well grounded. The book can be dry at times and some topics may be beyond the reach of the layperson but in general the author does a commendable job of making the book accessible and keeping the book concise. I learned a lot from this book and the author successfully addresses the main issues of his subject. If you are interested in this topic by all means get this book, I recommend it.

Further suggestions: "Winner-Take-All Politics: How Washington Made the Rich Richer--and Turned Its Back on the Middle Class" by Jacob S. Hacker, "Screwed: The Undeclared War Against the Middle Class - And What We Can Do about It)" by Thom Hartmann, "The Monster: How a Gang of Predatory Lenders and Wall Street Bankers Fleeced America--and Spawned a Global Crisis" by Michael W. Hudson, "Perfectly Legal: The Covert Campaign to Rig Our Tax System to Benefit the Super Rich - and Cheat Everybody Else" by David Cay Johnston, and "The Looting of America: How Wall Street's Game of Fantasy Finance Destroyed Our Jobs, Pensions, and Prosperity—and What We Can Do About It" by Les Leopold. Read more ›