MAKING AMERICA WORK
chickensh$!t tax credit costs the
French, madams et taxpayers about $135
messieurs, but million a year.
We also need to keep the benefit-reduction rates in welfare programs as low as possible. Since Milton Friedman first proposed a “negative income tax” in 1962, we have known that we would be better off with a single, comprehensive welfare system instead of the current system — with its dozens of overlapping and conflicting welfare programs.
IV. Some Specific Recommendations
In the time I have remaining, I want to offer a few specific reform proposals.
A. Making Taxes Work
First, we should reform the tax system. Many of the problems of the current tax system are the result of having two major taxes imposed on individual income: income taxes and Social Security payroll taxes.
Figure 8 shows that the stated federal income tax rates on a single parent with two children gradually increase from 0%, to 10, 15, 25, 28, and 33%, and eventually to 35%.
16. See Tax Relief Extension Act of 1999, Pub. L. No. 106-170, § 507, 113 Stat. 1860, 1922-23 (codified as amended at 26 U.S.C.A. § 45(c), (e) (West Supp. 2006)).