September 11, 2015
By Noah Smith
Republican candidates for president like Jeb Bush really need to try something different from the idea that tax cuts fix everything.
This isn't to say that there is nothing to like in Bush's recently released tax policy plan. It lowers the corporate tax, which economists believe is especially distortionary. It eliminates the favorable tax treatment of debt versus equity in finance, which is in keeping with our emerging understanding that debt bubbles are more dangerous than equity bubbles. It closes loopholes on itemized deductions. It expands incentives for business investment, and makes a few other useful tweaks.
But the mainstay of the plan -- the element that has grabbed the headlines -- is tax cuts. Bush wants to slash the top marginal tax rate to 28 percent, lower than it has been except for a couple of years in the late 1980s. He also wants to eliminate the estate tax. It's all pretty reminiscent of his brother's plan from 15 years ago.
Read the full article at Bloomberg View: Hey, Republicans! Push Deregulation, Not Tax Cuts