Kerry Tale Ending

A fantasy tax-plan to win the White House


With the political landscape denuded of striking policy proposals, Sen. John Kerry last week took the opportunity to call for that proven vote-getter, the $7 minimum wage. Minimum wage. A busted, Progressive-era artifact: the surest sign yet that Kerry has absolutely no idea how to beat President George W. Bush.

The Kerry brain-trust must operate under the assumption that Bush is going to run on his Reagan-week speeches, as some sort of no-nonsense, anti-government conservative. In reality Bush is running on his big government policies and spending initiatives, certainly as far as domestic policy is concerned.

Bush's first campaign ads stress his No Child Left Behind Act, which brings education under federal oversight, and his Medicare prescription drug bill. Together they expand Washington's reach and will cost taxpayers literally untold billions of dollars in the coming years.

When confronted with this Bush spending roadblock the only sane thing for the Kerry campaign to do is route around the obstruction by working the other side of the fiscal equation. If Bush has pre-empted the spending goodies—and this administration is all about pre-emption—Kerry must work the tax issue. And that does not mean namby-pamby "middle class tax cuts," which is code for yet another raft of technocratic tax credits for behaviors Washington deems worthy.

Were Kerry to come out for junking the entire tax code, Karl Rove would have a coronary. That move simply is not in the Rovian script for '04 campaign, not for Bush, certainly not for Kerry. Such a Kerry proposal would force Bush to either defend the absurd status quo or counter with a similar overhaul proposal, finally turning the me-tooism tables in Kerry's favor, for once.

Kerry need not even propose a tax overhaul that moves him "rightward" in the conventional sense. Back a consumed-income tax, with all savings exempt from tax, together with an end to all forms of corporate welfare on both the tax and spending side, and Kerry could frame his proposal as a bottom-up reform of Bush's corporatist leanings.

Kerry could even huddle with his vital public-sector union cronies to set the size of the personal exemption and exact tax rate, and to talk up the intention to tax corporate profits without fail. (Present company understanding that the "corporate tax" is, of course, a fiction. Only individuals pay taxes, but hey, this is the Kerry campaign we're talking about here.)

But the specifics could not be a subterfuge for tired class-warfare politics. Bush and Rove are ready for that. In fact, Kerry could score points with upper-income taxpayers by stressing the end to the hated alternative minimum tax and all the deduction "haircuts" their tax returns now endure.

Next up would be a series of speeches on his "You Save It, You Keep It" plan emphasizing fairness, simplicity, and grounding real tax reform in John F. Kennedy's tax cuts. With Enron back in the news, Kerry could press the need for a simple, transparent tax code that the fat-cat insiders with their high-powered lawyers and accountants cannot game and manipulate. (Aside: John Edwards and his high-powered lawyer friends probably shouldn't be part of the campaign to make this remotely believable.)

Best of all, Bush could not challenge Kerry on the exact revenues a radical tax overall might generate. Wholly Republican deficits have made such matters moot. Kerry needs only to get within a few hundred billion of break-even and declare victory, and maybe claim he'll get the balance from Halliburton and Ken Lay.

All in all, not a great moment in American politics, but it sure beats the alternative. Along about Labor Day, watch out for the $8 minimum wage from Camp Kerry.