We are scholars at the American Enterprise Institute, a nonpartisan, nonprofit policy research entity. Dr. Satel is a practicing psychiatrist who has studied and researched a broad range of matters related to mental health policy and addiction, including tobacco harm reduction. Mr. Brill is an expert in public finance and health economics, with a concentration in the economic and public health implications of smoking and its alternatives. The views expressed here are ours alone and may or may not reflect the views of our colleagues.
The opportunity for fundamental and comprehensive tax reform is before this Committee for the first time in many decades. As every Member of this Committee well knows, the tax code has frequently and sometimes significantly changed over the last 30 years, but not since 1986 has it been truly reformed in a manner that sought to broaden the base – that is, eliminate special deductions, credits, and exclusions– while lowering statutory tax rates. As Senators Hatch, Wyden, Roberts, and Grassley know firsthand, that legislative process was arduous and sometimes controversial, but the 1986 Tax Reform Act did result in a simpler income tax code with a broader tax base and significantly lower statutory tax rates.
S ESOPs, which are defined contribution retirement plans that allow employees to become owners, are increasingly popular in the US…. S ESOPs exist across a wide spectrum of industries and include a meaningful number of US employees. As the US seeks to rebound from a period of tepid productivity growth, tools such as S ESOPs can improve worker commitment, reduce worker turnover, and lower production costs.
The Maryland income tax scheme at issue here is as discriminatory as any tariff. Its discriminatory nature does not arise, as the Maryland Court of Appeals reasoned, from the risk that it may combine with some other state’s tax system to tax the same income twice.
As you carefully define in the document setting forth this hearing, “tax extenders” are a subset of the tax provisions extended by Title VII of the “Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010” (Public Law No. 111-312), as well as a number of other tax provisions that have expired or will expire this year.
As my testimony will describe, the recent improvement in payrolls and the unemployment rate are welcome news, but the plight of the long-term unemployed in the United States is considerable. The policies that have been executed since mid-2008 to foster an economic recovery have failed to deliver measurable results, and those most hurt by the current downturn are often the long-term unemployed. In fact, some policy actions taken by Congress and the Administration have likely exacerbated the duration of unemployment for some workers, the consequences of which are significant fiscal, economic, and social costs.
As the Subcommittee is well aware, the 2011 Social Security Trustees Report was released last month, and it projects that the combined Social Security trust funds will begin to be drawn down in 2023 and will be exhausted in 2036, one year earlier than projected in the 2010 Trustees Report.
The significance of manufacturing to the U.S. economy is undeniable, and the role and dynamics of this sector are important to study. It is critical to recognize, however, that manufacturing is but one segment of the U.S. economy, and the share of the resources dedicated to this sector should be determined by market forces, not government policy.
Sound retirement security policy for future retirees requires planning. Ensuring the goal of adequate asset accumulation at retirement necessitates sufficient savings throughout an individual’s career. To that end, workers need to be engaged; employers need to be responsible; and policymakers must ensure that pension law, tax law, and the Social Security system operate in a manner that promotes opportunities for private saving, appropriate retirement asset management, and sustainability and predictability. Together, these programs should complement the goal to strengthen the financial security of our workforce.
Chairman Baucus remarked at the opening of the first hearing in this series that “[a]ddressing our deficits and debts is an economic issue, a national security issue and a moral issue.” He went on to say that “we have a moral obligation to leave this place better than we found it, but today, our fiscal challenges prevent us from meeting that responsibility.”