Comment by chrisfosterelli
3 years ago
There's a lot of attacking in this thread from people who haven't bothered to think about the math. It's an existential risk to some companies, and one that wasn't more widely planned for because it wasn't even believed to be intended to actually occur.
Most tax experts considered the removal a budget gimmick so that the 2017 December republican majority could quickly pass a new budget using the budget reconciliation process, which can't be used to increase the deficit after a 10-year period so they had to add a time limit to a bunch of benefits "on paper" to use the reconciliation process. There appeared to be broad support for fixing it later, but the bipartisan spending bill expected to include it fell apart because they couldn't get agreement on other parts of it.
To the best I can tell this isn't tech companies complaining about paying fair tax; it's a congressional oversight that is quadrupling the taxes of small business out of nowhere which nobody in power has bothered to fix.
I understand the arguments for it, and maybe even on net it’s beneficial because it prevents other bad things from happening, but the amount of byzantine dysfunction that’s downstream of the United States Senate Filibuster rule is really something to behold.
To the extent that the filibuster's beneficial, I'd say it's only so because of our bad electoral system that stabilizes at only two viable parties, and sometimes results in minority rule.
I dunno, it still might be pretty tricky to put together 60 votes for cloture in a 3 or 4 party system. It might even be harder!
Fractious multi-party coalitions in parliamentary systems commonly fail to scrape together bare majorities- they're not exactly known for making it easy to produce supermajorities either.
14 replies →
The filibuster guarantees minority rule, in the Senate.
209 replies →
The filibuster rule is from a time when the Senate was selected by the States, not the people. It was designed as an effective State Veto.
It works for that purpose and in that context and IMO is good.
We should return the Senate to be the States representatives in congress, and the House is the People. Instead of having both the Senate and the House be popularly elected.
Return to more republican (i.e Republic not the party) style of governance, and less democratic, but I know that is heresy today where democracy is the new religion and people fail to learn the lesson of Athens
18 replies →
The filibuster is fine, in its original form. Manipulate the parliamentary process to push the date close to the end of session, then have some windbag with sufficient endurance read the phone book for a few days.
The current version, where you declare yourself filibustered, is too cheap. In the old days, they just filibustered stuff like voting rights, not procedures for borrowing money to support the adopted budget.
A proper endurance filibuster is fine, the current version is just pretending
How does that happen anyway. Why does the party with the majority allow a filibuster to happen without an actual speech?
2 replies →
I think both are undemocratic, and doubly so since it's in the vestigial organ of our former slave-driven agrarian economy.
There's no good reason to have the senate, let alone the filibuster and effective super majority required for legislation.
The filibuster continues to exist each new day because a simple majority of senators continue to want it to exist. Don’t let that majority off the hook for anything by pointing to a rule they could remove at will.
IMO doing anything at the federal level should require a supermajority anyway. The country shouldn’t swing back and forth due to a simple majority. If a supermajority can’t agree, leave it to states.
We would all be a lot better off.
6 replies →
What other bad things does this prevent from happening? I can't think of anything, unless you think double-taxing income is good.
Income gets double-taxed and triple-taxed and more all the time. Sometimes even by the some government body.
It may have been beneficial on net at some point in the past, but it's just bad at this point.
Thank you for providing the actual political context. It is much more helpful to know who did this and why then to complain about an amorphous and unchanging "Congress".
I read the message you are replying to three times and I still don’t understand who did this and why? Can elaborate more?
It's the House of Representatives. That body is the origin of all taxing. The leader of the House is Kevin McCarthy. It's is ultimately on him to lead the House (or get out of other's way) in passing a tax bill. The reconciliation process allows this to occur with less bipartisan support.
The interesting part of this appears to be that the Republicans removed this from the tax code but were expected to add it back in a new form. This did not occur in time for tax bills to be due.
To get the tax cut law through congress without requiring support from democrats, they had to raise revenue somehow, so they cancelled this provision, with the idea they would add it back later.
Sure. Here's the key sentence:
> Most tax experts considered the removal a budget gimmick so that the 2017 December republican majority could quickly pass a new budget using the budget reconciliation process, which can't be used to increase the deficit after a 10-year period so they had to add a time limit to a bunch of benefits "on paper" to use the reconciliation process.
In 2017, the Republican majorities in Congress passed a budget that would have increased the federal debt significantly over a ten-year period (i.e., it was a long-term deficit increase). Such an increase is not allowed under the rules of the Senate's budget reconciliation process, so they added sunset provisions that would have brought the deficit back down by making some of the deficit-increasing provisions (in this case, mostly tax cuts) expire early.
The next sentence clarifies:
> There appeared to be broad support for fixing it later, but the bipartisan spending bill expected to include it fell apart because they couldn't get agreement on other parts of it.
These changes were made "on paper" to meet the reconciliation rules in time to pass a budget and avoid a government shutdown, but they were not intended to be permanent -- they were just a quick hack to work around procedural limitations. The intent was to fix this later, but the fixes were never implemented due to disagreement about how to handle other parts of the bill.
The advantage of this kind of description is that it gives you a piece of a larger story and leads to some obvious follow-up questions. Why did it take until the last minute for Republicans to pass a budget when they had full control of Congress and the White House? Why couldn't they pass a budget that didn't increase the deficit? Why does the Senate have such weird procedural issues and why haven't they been fixed? You can find some of the answers by looking into the bill itself[1]. But even if you don't you can pick up other pieces later by hearing other bits of news. The factions and political processes that produce bad legislation can be understood, and with that understanding the power to alter them, even if only by voting.
The other kind of description, which I see far too often, treats bad legislation the same way we treat bad weather. It can be predicted a few days in advance, but we have no control over it. It's just something that happens, and all we can do is let it wash over us. The clouds bring the rain and Congress brings bad legislation; thus has it ever been. It's an ahistorical form of learned helplessness.
[1] https://en.wikipedia.org/wiki/Tax_Cuts_and_Jobs_Act_of_2017
The thing that is most striking to me about your explanation is that the change was made six years ago; it seems that anyone responsible for a company's tax position and cashflow (CFO, accountant, etc) should have been planning for this between then and now. Much like the SVB panic, a great deal of this seems to be people running companies without either paying attention to things that could have a significant impact, or hiring someone who does.
When I took tax law, one of the things that blew my mind is that it can be retroactive.
An exemption might expire, but then be retroactively reinstated. This happens all the time.
There is the tax law that applies to your 2022 income now, and then there's the tax law that will apply to your 2022 taxes in five years.
They have been. Large companies have been engaging with Congress since 2019 on this, reminding them that they intended to revert this before it took effect. CFOs wrote a letter to Congress in November. https://investinamericasfuture.org/Communications/letters/
Maybe they put too much trust in the US congress' functioning
I don’t know why you’d think it was an oversight. After all, they pushed SALT, which raised the taxes of any homeowner living in a high cost of living state, and further transfers wealth to flyover country and the south.
It gets worse, we do not reach true majorities in the House and Senate until 2030. Thus until then budgets get passed under budget reconciliation.
This whole thing sounds so shady to me, can't believe this is how they are running a country.
[flagged]
What does any of this have to do with libertarians?
Nothing. It's an oddball comment, for sure!
As a minarchist (form of libertarian), I would love to see the state operate more efficiently. That would achieve a part of my own personal political beliefs. I recognize the need for a state and the role society must have in shaping it for it to be a stable, functioning state.
Surprise rules dramatically increasing taxation due to political judo performed six years prior is horrible.
[flagged]