Originally published on The Huffington Post 8/21/12
In choosing Paul Ryan as his running mate, Governor Romney has fully embraced the conservative conceit that tax breaks for the rich really will produce jobs for the poor and middle class. Government, these new libertarian conservatives aver, doesn’t and can’t produce jobs, only the private sector can. To do so the benefactors of great wealth need only be unburdened of any obligation to pay taxes, since taxing them only robs them of the resources to put America back to work. Mr. Ryan is also a fan of vouchers, proposing to shift Medicare from a government to a private sector program in which we get vouchers to buy our own coverage from private vendors.
So let’s put the premise of Ryan’s libertarian economics to a test he can believe in: let’s offer tax breaks to the wealthy in the form of jobs vouchers. For every (say) 25 thousand dollars deducted from a millionaire’s tax bill (the approximate value of a job just above the poverty line), the beneficiary receives not a refund or reduction in taxes owed, but rather a voucher worth $25K that can be cashed in for its face value with the U.S. government by a worker for whom a new job has been created by the wealthy tax-payer. Want a $100,000 break? Create four new jobs. The tax-payer must prove he has actually created a new job, of course; not replaced one job with another.
With new jobs created, the wealthy taxpayer recycles his tax break in exactly the way Ryan insists he is going to — using it to benefit the economy at large and unemployed job-seekers in particular. Since choice is what vouchers are all about, the tax break beneficiary will have three to six months to produce a job of his design on his own schedule. He gets his tax break, an unemployed worker gets a job and the economy overall is improved. Win-win-win. Call it mandatory trickle down.
However! (and it is a crucial ‘however!’) Fair is fair; and if the Ryan theory turns out not to work as described and the would-be job-creator fails to create a new job, the voucher’s value is nil, and the tax break will automatically disappear along with the voucher. No job, no refund.
To give the wealthy a little extra motivation, and put a price on their promise, the government can also impose a penalty. If a job is not created within three to six months, not only will the voucher expire, effectively returning its value to the U.S. Treasury and costing the tax-payer his break, but a penalty will be assessed in the amount of the voucher. Kind of like a “double or nothing.” Spend your tax break on a job and keep it. Break your promise and lose the break and pay the IRS an additional tax in the same amount.
It couldn’t be fairer, penalty and all, since the only rationale for the tax break according to Messrs. Ryan and Romney is job creation. And as long as tax breaks for the rich really do lead to more jobs, we all benefit just as Ryan promises we will. It is only if the rich are kidding or lying, and what they really want is more for themselves and to hell with everyone else that they lose the break and pay the penalty.
Liberals can stop calling conservatives hypocrites or trying to rebut them. Let conservatives prove themselves right. Give them the benefit of the doubt and the breaks they altruistically crave, but with the proviso that they get nothing and pay double it doesn’t result in jobs.
Conservatives should certainly welcome the principle of vouchers, which they have been proffering for a long time to the poor for education, groceries and housing — and now, courtesy of Mr. Ryan, for Medicare too. The premise has been that a voucher prevents “irresponsible behavior” by those being helped, like buying drugs instead of groceries or a golf caddy instead of private schooling for the kids. It’s a way to prevent the poor from getting all that “free stuff” Mitt Romney thinks they are always conniving to acquire.
So now the rich too can also be held to account: no “free” government hand-outs in the form of tax refunds for them either. Just the wherewithal to create the jobs they say will be their gift to the nation.
Win-win-win. Or pay up.