A standard feature of political discourse between putative allies is when each side claims the other is an illegitimate proponent of the faith. This is currently on display for viewing in the competing threads for and against Rick Santorum’s proposed manufacturing tax policy.
Unlike Quill and Becker I have not given enough thought to the specific proposal to take a comprehensive position, however I do have a few thoughts on one aspect of the argumentation that I see in the original posts and the voluminous comments that follow each.
An interesting feature of this debate is the positing by some that the proposed tax policy would be tantamount to “social engineering”. While technically accurate, I would suggest that a definition that broad would logically also mean that virtually ALL governmental action could reasonably be considered “social engineering”. In fact Wikipedia saved me some typing by helpfully summing it up very well:
For various reasons, the term has been imbued with negative connotations. However, virtually all law and governance has the effect of seeking to change behavior and could be considered “social engineering” to some extent. Prohibitions on murder, rape, suicide and littering are all policies aimed at discouraging undesirable behaviors.
So while I agree that in a very narrow sense a zero tax on manufacturing would be social engineering, I also understand that in this context the specter of “social engineering” is being used as a scare tactic to twist the debate and discredit Rick Santorum’s proposal.
Becker advances the highly questionable claim that taxes are not causal to changes in economic activity:
“With respect to Santorum’s zero tax for manufacturing as a way to revitalize the nations employment base, he’s simply wrong. He has no clue what motivates the private sector because he hasn’t been in it forever. All he’s doing is tinkering with the tax code in a slightly different way than Obama does. And, it won’t make a difference. Federal taxes, by and large, don’t impact manufacturing in a way that will accomplish an expansion of the manufacturing base and create jobs. “
I find it astonishing that anyone who calls them self a conservative would argue against a tax cut on the grounds that taxes don’t impact business decisions. I certainly understand Becker’s concerns as regards cutting one tax and then raising another, but as far as I know that is not part of Santorum’s plan but is simply Becker’s opinion of what may happen.
If this proposal represented the first exception ever carved into the tax code I again would share Becker’s concern. That of course is not the case as our tax laws are an incredibly complex hodge podge that gives with the right hand while taking with the left hand. If the manufacturing sector can be revitalized with one more tweak to the tax code I for one won’t quibble.