Tag: tax

Posted in Keystone

A Flat Tax Without Spending Discipline Is Just Cleaner Paperwork

Posted on by simplebender

Tax reform should make life simpler for citizens, not make poor budgeting easier for politicians.

The Keystone budget standard is straightforward: every promise should show the bill, and both spending increases and tax cuts must be held to the same standard. With that discipline in place, tax reform can be discussed honestly rather than sold as a way to avoid difficult choices.

The American tax code is not merely complicated. Its complexity distributes power. Ordinary wage earners, pensioners, and small-business owners face forms, classifications, deadlines, phaseouts, and rules their representatives may not understand or even have read. Large institutions hire specialists to navigate the maze, lobbyists to reshape it, and lawyers to preserve exceptions. Complexity becomes a toll exacted from those with the least time and leverage.

That is the appeal of a flatter, simpler tax system. Fewer rates, fewer carveouts, clearer treatment of income, and lower compliance costs could reward work, saving, investment, and enterprise. Citizens should be able to understand what they owe and why. Similar income should be treated similarly. Political influence should not determine which dollar is taxed and which dollar receives a private escape route.

But the word “flat” can obscure as much as it clarifies. A tax system can be simple yet still unfair. It can lower the headline rate while shifting burdens onto working families, retirees, or small businesses. It can reward certain forms of income while taxing others more heavily. It can eliminate deductions that ordinary households rely on while preserving less obvious advantages for sophisticated interests.

The Keystone Compact therefore supports flatter taxation, with fiscal and distributional guardrails.

A serious reform should protect lower-income households from punitive burdens, avoid hidden tax increases on retirees and working families, reduce compliance costs, treat similar incomes similarly, and end most politically favored deductions. A generous personal exemption or comparable protection should preserve the principle that no citizen should be taxed into poverty. The system should encourage domestic investment and enterprise without turning every favored industry into a special category.

These safeguards are not concessions to complexity. They are part of honest design. Simplicity is valuable because it limits manipulation and makes the rules visible. It is not valuable if it merely shifts the unfairness into a cleaner column.

The greater danger is fiscal fantasy. A government cannot simplify its way out of overspending. If a flatter tax reduces revenue without corresponding spending discipline, the deficit does not disappear. It is merely renamed. The tax form becomes cleaner, while the national balance sheet weakens.

A flat tax without spending discipline is deficit laundering.

Tax and spending reform must go hand in hand. Programs should undergo sunset reviews. Waste, duplication, failed subsidies, corporate welfare, emergency-spending abuse, and benefits directed to households or companies that do not need them should be targeted first. Long-term obligations should be made visible. Tax preferences should be judged by public value rather than by political sponsorship.

This matters most outside the lobbying districts. A small-business owner should not need an accounting department to determine whether hiring one more worker is affordable. A retiree should not discover that simplification quietly changed how savings accumulated under older rules are treated. A family should not spend hours proving it qualifies for a benefit designed to offset a burden imposed elsewhere in the same code.

The tax code should raise the revenue required for legitimate government with the least distortion, coercion, and favoritism, consistent with what is reasonably possible. It should not be used as a shadow appropriations process in which Congress rewards constituencies without acknowledging that it is spending through exceptions.

Simpler taxes are good. Honest taxes are better.

The ultimate test is not whether a return fits on a postcard. It is whether citizens can see the burden, whether it is fairly shared, and whether government has disciplined spending that created the need.

Once the tax code stops serving as a warehouse for political favors, another distinction becomes unavoidable. A free market is not the same as a government-protected marketplace reserved for insiders.

Next in Category II: Capitalism Needs Rules, Not Cronyism

NeverFearTheDream………. W. C. Barron………. simplebender.com……….keystonecompact.org

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Lap Around the Sun: Daily Steps Forward
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Posted in Current Events, Political

Full Disclosure: The Cost of Autonomy

Posted on by simplebender
This article is Oregon centric by design. However, every state has the same issue to one degree or another. Each will face the dilemma and respond differently. But of course, our federal tax will drop when the state assumes more responsibility; right?….right.

Political campaign ads are built to simplify. A vote is pulled from context, a tax increase becomes a betrayal, a tax cut becomes prosperity, and yesterday’s circumstances are presented as tomorrow’s guarantee. But beneath the noise is a real fiscal question for Oregon: how will next-generation state and local leaders handle a federal government that shifts costs to the states and cuts support for certain programs?

For decades, federal funding enabled states to support programs whose full local costs were partially obscured by participation. That arrangement was not charity; it was a partnership, usually accompanied by federal rules, matching requirements, and oversight. When Washington reduces support or changes the terms, recipients face difficult choices: replace the funding, redesign the program, scale it back, or abandon it. We choose our future leaders. What they decide is what we have to live with. Federal influence does not require federal control; financial dependence itself creates leverage. Independence reduces that leverage, but it has a price.

In Oregon, federal dollars accounted for 36.7% of general revenue in fiscal 2024 [1]. The 2023–25 legislatively approved budget detailed $38.6 billion in federal funds. Of that total, almost 84% was allocated to the Health Authority and the Department of Human Services. Those two agencies accounted for roughly 84 cents of every budgeted federal dollar [2] and encompass the Oregon Health Plan and Medicaid, behavioral health, long-term care, disability services, SNAP, and other human-service programs.

The Medicaid matching relationship is especially important. Oregon contributes state dollars and receives federal dollars according to applicable matching rates.[3] Losing $1 of federal Medicaid support does not automatically mean Oregon writes a replacement $1 check. A federal change might reduce enrollment or services and consequently reduce both federal and state spending. But if Oregon chooses to preserve benefits or eligibility, the difference has to come from somewhere: additional state revenue, reduced spending elsewhere, lower provider payments, program redesign, reserves—or some combination.

The Department of Human Services dollars reach food assistance, disability services, long-term care, nursing facilities, vocational rehabilitation, child welfare, and eligibility administration. These are not abstract line items. They touch children, working families, older Oregonians, people with disabilities, caregivers, providers, and communities throughout the state, on both sides of the Cascades.

That is where campaign promises should meet full disclosure. If a candidate proposes cutting state taxes while remaining silent about current services, ask: what replaces the lost revenue if federal support also falls? If existing programs are to be preserved, how much additional state revenue would be required, and from where? If no new revenue is proposed, which services, eligibility standards, provider payments, or other state priorities would change? These are not ideological questions. They are fiscal realities.

The simple version is this: if Washington pays less and Oregon wants the same program, Oregon must pay more. If Oregon does not want to pay more, programs must change. In 2026, the Oregon Legislature started to address a part of the conundrum and committed $111 million in General Fund money to begin accommodating the new SNAP and Medicaid requirements.[4] The less visible question is what broader budget tradeoffs were necessary to allocate additional funds?

There is an irony here. Federal retrenchment could produce more genuine federalism. Replacing federal dollars with state dollars can give Oregon greater policy freedom, but it does not make the underlying programs cheaper. Autonomy is not free; it simply makes the price harder to hide.

Oregon’s budget ultimately must balance.[5] Future leaders may choose higher revenue, fewer services, different services, or some combination. Full disclosure means asking whether their promissory policy and rhetorical math survive past Election Day. The harder question may be the more useful one: How much independence do we really want when we are finally asked to pay its full price? We choose our leaders…ask the hard questions.

NeverFearTheDream………. W. C. Barron………. simplebender.com……….keystonecompact.org

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Books You Might Enjoy…

Lap Around the Sun: Daily Steps Forward
by WCBarron

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Joy in Alzheimer’s: My Mom’s Brave Walk into Dementia’s Abyss
by WCBarron

Buy at Amazon Buy at Barnes & Noble Buy at Books2Read

Footnotes

  1. The Pew Charitable Trusts, Where States Get Their Money, FY 2024, using U.S. Census Bureau Annual Survey of State Government Finances data. Pew reports federal funds at 36.7% of Oregon general revenue and state taxes at 36.0%. “General revenue” excludes state-owned liquor stores, utilities, and insurance trust funds.
  2. Oregon Legislative Fiscal Office, 2023–25 Legislatively Approved Budget. Oregon budgeted $38.571 billion in Federal Funds; Oregon Health Authority accounted for $19.857 billion, or 51.5%, and DHS for $12.455 billion, or 32.3%. Combined: 83.8%.
  3. Oregon Health Authority, Oregon Medicaid Local Match Rates. Federal Medical Assistance Percentage rates determine the federal share of Medicaid/CHIP expenditures; the programs are jointly financed by federal and state or local government.
  4. Oregon Department of Human Services, Human Services Legislative Summary: Oregon 2026 Regular Legislative Session. The Legislature approved $111 million General Fund and 392 positions related to implementation and response to federal SNAP and Medicaid changes.
  5. Oregon Secretary of State, Government Finance: State Government. Oregon law requires state and local governments to balance their budgets.
Posted in Current Events

Deportation: Ideology’s Failed Business Model

Posted on by simplebender

Strip the politics and twisted morality from the equation and look at the ledger. Detain-and-deport is a bad deal, a bad business model. It is a capital-intensive, low-yield operation that consumes cash upfront and erases future revenue streams. ICE’s reports estimate 2024 detention at ~$152 per person per day, and Alternatives to Detention (ATD/ISAP) run less than $4.20/day. With an average detention time of ~47 days, costs are roughly $7,100 before airfare or litigation. The ATD analogue costs approximately $200. The ATD option is significantly more cost-effective. No operator would choose a bloated workflow over one that accomplishes the compliance goals, unless driven by ideology. [1][2][3]

What are the “savings” from deportation? They are mostly phantom fiction. Undocumented immigrants are largely ineligible for means-tested benefits (Medicare & SNAP) but do pay taxes—$96.7 billion in 2022. Every removal wave eliminates the systematic recurring cash flow to Social Security, Medicare, and state/local treasuries. That’s not ideology; it’s real revenue loss, which U.S. taxpayers must now cover. [4]

Scale it to policy. FY2024 removals: 271,484. Apply the per-diem and dwell time above, and you’re in multi-billion direct outlays—before transport—plus foregone taxes compounding each year that workers would have remained employed. The CBO is explicit and clear: higher immigration raises revenues faster than outlays and lowers deficits over the 2024–2034 period—those are good things. Shrinking the workforce via deportation pushes the other way—those are bad things. [5][6][7]

Now consider and add the 2025 capex binge. Florida’s “Alligator Alcatraz” chomped up $245M+ in contracts, faces $15–$20M in immediate shutdown costs, and could leave taxpayers with approximately $218M if closure holds. In Texas, the Fort Bliss complex is a $1.2–$1.26B build for a 5,000-bed camp. None of this produces tradable output; it locks in fixed costs for an already established inferior business model. [8][9][10][11]

Deportation supporters claim enforcement frees jobs for U.S. citizens. Reality check: key sectors (agriculture, construction, and manufacturing) depend on immigrant labor. In agriculture, roughly 42% of hired crop workers lack work authorization. Remove that labor at harvest and you don’t get higher yields; you get unpicked fields and lost revenue—exactly what state-level crackdowns have shown. Construction and parts of manufacturing tell similar stories: persistent vacancies and delayed projects don’t resolve themselves without labor—but look, ICE just booked another flight. [12]

Crucially, there’s a proven substitute. Case-management ATD programs deliver 97–99% court-appearance compliance at a fraction of detention costs. If the goal is rule-of-law compliance, ATD wins on both price and performance. Detention should be the exception for demonstrably high-risk cases. [13][14][15]

If you’re genuinely fiscally conservative, the decision tree is simple. Each detained-then-deported worker carries:

  •  a high acquisition cost (detention, transport, litigation, facilities),
  •  negative NPV from lost tax receipts, and
  •  sector-level output losses when crops aren’t picked or projects slip.

In contrast, ATD + lawful work authorization during proceedings flips the script:

  • minimal custody costs,

(2) continued tax payments, and

(3) fewer supply-side shocks.

Even hard-line models concede that mass deportation shrinks GDP by the trillions. The Penn Wharton Budget Model, a conservative economic model, concedes that mass deportation shrinks GDP by trillions—that’s a bad thing—and projects primary deficits of approximately $862–$987B over 10 years under mass deportation scenarios. That’s the destruction of U.S. shareholder value.[16][17]

If this were optimizing a business, you’d terminate detention first, scale case management ATD, and reserve deportation for the narrow slice where public safety benefits justify the expenditure. Anything else is a bad deal and taxpayer-subsidized ideology—that’s not a good thing. #NeverFearTheDream

Footnotes

[1] U.S. Immigration and Customs Enforcement, “Alternatives to Detention (ATD)” — < $4.20/day ATD vs ~$152/day detention. ICE
[2] ICE, Fiscal Year 2024 Annual Report — average length of stay 46.9 days. (PDF) ICE
[3] American Immigration Council, “Alternatives to Immigration Detention: An Overview.” American Immigration Council+1
[4] Institute on Taxation and Economic Policy (ITEP), “Tax Payments by Undocumented Immigrants” — $96.7B in 2022. ITEP
[5] ICE news release (Dec. 20, 2024): 271,484 removals in FY2024. ICE
[6] Congressional Budget Office, “Effects of the Immigration Surge on the Federal Budget and the Economy” — higher immigration lowers deficits via revenues > outlays. Congressional Budget Office+1
[7] ICE, “FY2024 Annual Report” companion release. ICE
[8] AP News, “Florida may lose $218M on empty ‘Alligator Alcatraz’ as judge orders shutdown.” AP News+1
[9] CBS Miami, “Florida taxpayers could be on the hook for $218 million … ‘Alligator Alcatraz.’” CBS News+1
[10] Yahoo News round-ups on court-ordered shutdown and wind-down. Yahoo+1
[11] The Texas Tribune, “Feds plan to build nation’s biggest migrant detention center at Fort Bliss” — $1.26B, 5,000 beds. The Texas Tribune
[12] U.S. Dept. of Labor, NAWS 2021–2022 (Report No. 17) — ~42% of hired crop workers lack work authorization; summary page. DOL+1
[13] Human Rights First, “Proven Alternatives to Mass Incarceration of Families” — programs with ~97% appearance; cost far below detention. (PDF/brief) Human Rights First+1
[14] Women’s Refugee Commission, Family Case Management Program — ~99% compliance with ICE and court. (Report/summary) Women’s Refugee Commission+1
[15] National Immigrant Justice Center, “The Real Alternatives to Detention.” (Policy brief) National Immigrant Justice Center
[16] American Action Forum, “The Budgetary and Economic Costs of Addressing Unauthorized Immigration” & “A Costly Immigration Policy” — $400–$600B federal cost; −$1.6T GDP. AAF+1
[17] Penn Wharton Budget Model, “Mass Deportation of Unauthorized Immigrants: Fiscal and Economic Effects” — revenues −$300.4B (2025–2034); primary deficits +$862B pre-feedback, +$987B with feedback. (Brief & PDF) Penn Wharton Budget Model+1

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Posted in Current Events

Federal Extortion Tax

Posted on by simplebender

First Published in the Bend Bulletin 8/29/25

The world’s expectation of the United States has shifted—and with it, the nation’s business climate. In recent months, the U.S. has altered long-standing treaty commitments, reduced foreign aid, and extended cordiality toward governments once deemed global pariahs. But what’s unfolding domestically may be worse: an extortion tax on America’s innovators and businesses.

New Gatekeepers of Innovation:  Universities—the cradle of U.S. invention—are under pressure not just to meet academic standards but to bend to the political and financial whims of federal funding agencies. The current administration recently invoked the Bayh–Dole Act to demand that Harvard disclose all patents tied to federally funded research and justify their use. Officials threaten to seize or relicense patents if unsatisfied. Harvard holds more than 5,800 such patents, making the scope of this action unprecedented in modern U.S. research policy. It also ignores the principles behind a patent, which is to protect the holder from infringement and allow unfettered use for their chosen purpose.

This follows similar disputes in which Columbia paid over $220 million and Brown about $50 million to settle federal claims tied to research funding. While the Bayh–Dole Act technically allows such interventions, the tactic has rarely been used to this degree and is viewed by critics as an intimidation lever—discouraging innovation rather than protecting the public interest. Federal funding for university research has already fallen 18% between 2011 and 2021, placing the U.S. 27th among OECD nations relative to GDP.

The result: private investors could increasingly control university-generated intellectual property, profiting when it suits them—or worse, foreign research entities could surpass U.S. capabilities entirely.

Corporate Pay-to-Play:  The private sector is not immune. Under the Hart–Scott–Rodino Act, mergers above set thresholds must pay filing fees ranging from $30,000 to over $2.3 million. These fees are predictable; the new problem is the creeping insertion of ideological conditions into merger approvals.

In one recent case, the Federal Trade Commission considered requiring merging companies to pledge not to boycott platforms based on political content. The Federal Communications Commission has also been accused of pressing telecom firms to dismantle diversity, equity, and inclusion programs in exchange for approval. Such moves transform regulatory review from market oversight into ideological enforcement.

Tribute for Trade:  Meanwhile, domestic companies face conflicting regulations, shifting markets, and tariffs imposed without transparent justification. Tariffs—already a hidden tax—are now coupled with the specter of requiring companies to share a percentage of revenues or profits to secure an export license. While no such policy is yet on the books, the idea mirrors the royalty extraction models of state-controlled economies. It would not just reduce profitability; it could drive companies to cede markets to foreign competitors.

From Rhetoric to Reality:  For an administration elected on promises of being “pro-business” and “cutting regulations,” these actions move in the opposite direction. They discourage innovation, deter mergers, burden trade, and concentrate control in the hands of government gatekeepers. This is not the free-market leadership America once championed—it is a pay-to-play extortion system closer to the state-ownership models of authoritarian regimes and organized crime—what wonderful examples to replicate for a government of the people. Just hope someone with integrity is keeping track of the extorted money. #NeverFearTheDream

NeverFearTheDream simplebender.com @simplebender.bsky.social Stand For Truth

If you’re looking for daily thoughts and insights you will want to start the morning with:

For Every Problem...A Solution...
Lap Around the Sun: Daily Steps Forward

If you know someone who is facing any facet of Alzheimer’s they might gain some insight from:

Joy in Alzheimer’s: My Mom’s Brave Walk into Dementia’s Abyss

Please consider following simplebender, you’re reading makes my writing more fun..…

Comments and thoughts are always welcome and feel free to re-post …..