Friday, March 30, 2007

New tax blog promoting the GRT

I like this: Governor Blagojevich's team has a tax blogger, Douglas Kane, at (also posting at Illinoize). I'm glad to see the GRT advocates engaged in the debate.

Mr. Kane's point in his recent post is that "a business-friendly climate" does not mean "corporations don't pay taxes" which many business groups often use as synonyms.

If corporations pay taxes and get benefits from it -- like, not having to pay for health insurance for their workers because taxes cover that, or a transportation network that allows them to get workers to show up and sell their products to a broad market, or workers who are educated enough to add value to the company -- then that's better than not paying taxes at all and then not getting any of those benefits.

It's just a pragmatic calculation about which deal is better -- buy good things with taxes, or live without those good things and not pay taxes. In a lot of the big policy debates (health care, education, transportation), we're generally not investing enough with taxpayer-financed initiatives to come up with the optimal arrangement. Each proposal, like Illinois Covered, or Transportation for Illinois Coalition's Keep Illinois Moving Forward package, needs its own cost-benefit assessment, but it makes zero sense to say that raising taxes is automatically bad, regardless of what we might buy with the tax money.

That's like saying buying a house is bad because it costs hundreds of thousands of dollars -- and that money will have to be paid for somehow! If the benefits outweigh the costs for most people, it's worth doing. If not, it's not.

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