Frank Aquila's Jobs Agenda

http://www.futureofcapitalism.com/2011/05/frank-aquila-jobs-agenda

A lawyer at Sullivan & Cromwell, Frank Aquila, has a column in Businessweek calling for a "jobs agenda," including eliminating "burdensome regulation," reforming the tax code, and increasing skilled immigration. So far, so good, but then he adds on this:

Tax credits for jobs. Employers should receive additional tax credits for creating new jobs. A temporary federal tax credit would give businesses added incentive to create new jobs. While such a tax credit would reduce federal revenues in the short run, the economic growth generated by the new workers would eventually more than make up for any lost tax revenue.

Compare that proposal to his paragraph on tax reform, one paragraph earlier:

Only on Washington's K Street, the center of the lobbying universe, is the U.S. tax code viewed as a thing of beauty. Beyond the lobbyists and special interests, the U.S. tax code has become a web of deductions and rules and regulations that conspire to thwart economic growth and limit job creation. Business and individuals both would welcome flatter rates and fewer deductions. Tax reform that brought lower nominal rates and fewer deductions would promote rational financial decisionmaking.

This is why tax reform doesn't happen, or why, when it does, we still end up with a highly complex tax code. Even advocates of tax reform, while bemoaning the "web of deductions" in one breath, are in the next breath advocating for their own favorite "temporary" tax credit or deduction or carve-out.

by Ira Stoll  |  May 18, 2011 at 8:40 am Related Topics:  Immigration, Regulation, Taxes receive the latest by email: subscribe to the free futureofcapitalism.com mailing list