AMT

Believe it or not, there is one thing that I agree with Elizabeth Warren about ... and that is that profitable big tech corporations like Amazon should not be paying zero taxes ... even though the present tax code allows it. There is an AMT, Alternative Minimum Tax, for individuals ... so that the accumulation of tax loopholes (hopefully) doesn’t allow high-income individuals pay no, or very little, taxes.

Trump, if he were wise, would promise to make such a tax-code change part of his next tax reform legislation once he is re-elected in November.

Complexity

I guess it may be a function of my little grey cells dying off, but I am increasingly revolting against the complexity that technology is forcing upon me.  Recently, my e-mail supplier switched to AOL and, in order to use this new service, I have had to learn a whole new user interface ... one that is clumsy and non-intuitive. And, to do my income taxes this past Spring, I spent too many days trying to decipher the insane complexity of our tax code. Why am I being led by the nose into these labyrinths of what idiosyncratic designers think is the proper way of doing things? And, to place their brand on their designs, old protocols are eschewed for newer but not necessarily better ones.

Part of the genius of Steve Jobs was that he frequently got the user interface right ... one that was naturally intuitive. It didn't require a user manual to understand how things worked. Now end users seldom have manuals to educate them on the ins and outs of a new gizmo ... an unfortunate homage to Jobs.  Features that may be neat to the designers, become a bear to figure out. So I have become a bit of a Luddite. I wont use a smart phone ... an old clam shell works just fine. I do use an IPad, but grit my teeth much of the time. I do not look forward to autonomous cars because I don't really believe that they will simplify my life. When something goes wrong ... and it will ... many of us will be at a loss as to how to fix things.

In a way I am not too unhappy that I may not be around for this brave new world of increasingly complex technology. Matter of fact, I am thinking about buying an old Chevy Bel Air to get around in ... and hire H&R Block to do my taxes next year.

The Fiscal Cliff

I’m taking a chance by opining on the threat of the looming fiscal cliff before the President’s press conference today, but what the hay. Such considerations have not stopped me before. Here goes.

I think that the best option might well be to go off the fiscal cliff. The reason being that our petulant President’s only proposed solution to our current fiscal problems is to raise the tax rates on those who make more than $250,000 per year. He has scrupulously avoided talking about spending cuts or entitlement reforms. It is blatantly clear that we cannot fix our monetary morass only with such a tax rate increase. And, if the Democrats run true to form, any promised spending reforms will never occur once the tax rate increases are approved. I admit it is dangerous … but only by accepting the pain of the fiscal cliff are we going to begin to address our government spending problems.

Yes, our free-fall off of the fiscal cliff will cause income and capital gains tax rates to go up on us all, but we will also get concomitant substantial government spending reductions. And yes, this will probably push us back into a recession, but it is also likely that tax rate increases on those earning more than $250,000 will also put the (albeit smaller) kibosh on our GNP growth. Besides, I strongly suspect that our legislature will quickly fix the more egregious of the spending cuts (such as for the Defense Department) with emergency appropriations. In a strange way, one might look at the fiscal cliff as a form of zero-base budgeting … to me, a good thing.

I also could accept Mitt Romney’s suggestion of a cap on personal income tax deductions and “loopholes” of say $35,000 … IF accompanied by meaningful government spending cuts. This would effectively raise federal revenues without the messy business of a total overhaul of the tax code … and all the lengthy political haggling that would go along with picking and choosing among which deductions to keep or which to axe. But simple solutions never seem to be favored by Washington insiders, so I am not too sanguine about this option. Ergo, grab your parachute and yell with me “Geronimo.”