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It’s Friday, so some feedback. Former IRS Commissioner Charles Rossotti weighed in after my Wednesday post suggesting President Biden’s spending plans will have to be financed by debt or new taxes. There’s another way, he says—collecting taxes already owed:
“Our plan gets at the heart of the tax gap—upper income people who don’t pay what they legally owe. At $574 billion in 2019 alone, the tax gap is equal to what the lower 90% of all individuals pay in federal income taxes annually. This is manifestly unfair.”
You can find more on Rossotti’s proposal here.
And lots of folks commented on my suggestion that companies not pull out of the political contribution game—because they can be a force for pragmatic compromise on important issues. A sampling of the comments:
“I believe buying access, or the NEED to buy access (even if the money goes to both sides of the aisle) is the root of the problem…We have to… restore some sanity to representative government and unwind myriad ways in which special interests control the narrative.”
“How much did the parties just spend in this campaign? Was it 11 billion? (AM: Actually, $14 billion.) How many people can we feed, clothe, shelter and provide job training with even a portion of that ridiculous sum?”
“At its heart…the primary objective (of corporate campaign contributions) is stability…Businesses want to know what to expect. With that knowledge, they can plan their strategies and tactics for the future.”
A.H. wrote in to remind me that corporations don’t make contributions directly. They do so through political action committees, which their employees contribute to. And for the record, I’m not a fan of the current campaign finance system. I’m just saying big companies are among the more responsible and pragmatic players in that system, and if they alone pull out, it will get worse.
Finally, my friend Shiva Rajgopal, who teaches at Columbia Business School, sent a paper that he says shows corporate lobbying pays off 10 times better than R&D spending, in terms of its effect on the bottom line. Given that finding, “the bigger question is why do we observe so little as opposed to too much lobbying.” His paper is here.
More news below. And check out Susie Gharib’s new interview with Delta CEO Ed Bastian, who is counting on a “big surge in demand” from business travelers in the second half of this year as the vaccine gets rolled out. “People are tired of Zoom meetings.”