Unless the middle class starts paying more the revenue problem won't be resolved.Steve Forbes' flat tax proposal floundered unnecessarily on the rock of the abolition of the mortgage interest deduction. That was entirely gratuitous, since the law "coulda shoulda woulda" had a provision in it to compensate the loss of that deduction at the expense of the lender of the mortgage, who would otherwise have a windfall in the elimination of tax on interest. The point being that the taxability of interest payments would, under a flat tax, precisely balance the deduction accorded the debtor (always assuming that the debtor itemized that deduction, as not all debtors actually do).The provision would've been highhanded in adjusting contracts, but it would have kept the parties whole in effect. The other way of doing it would have been to grandfather in the existing deductibility/taxability for existing mortgage loans, outlawing deductibility and taxability of interest on future loans.
Unless government spending is limited, the "revenue problem" won't be resolved.
This is the nuts-n-bolts of the who problem and solution.
IMO, Americans need to realize that our elected officials have a certain mind-set (spend/spend, force the people to pay by raising taxes (on something-anything))
Just listen to all the "new" ideas that so many politicians are throwing around on how to raise revenue. How many do you hear talk about reigning in spending?
They can't stand the thought of not being able to spend, so they have to think of ways to get the money to spend on the things that our newly elected officials are fighting to eliminate (shaking head).