Tancredo leaves and endorses Romney, for better or worse

Will his endorsement lift Romney?

I'm more curious about what your analysis is than in giving my own. As yet, I am equivical about the effect, but I do think it is a nod towards Romney's repute with the party mainstream.

Thoughts?

Reject the Fair Tax

I want to disclaim at the beginning that I am no tax policy expert. Yet, I think that the concepts argued for and against the “fair tax” as proposed by Mike Huckabee are simple enough that most people should be able to understand them.

Mike Huckabee describes on his campaign web site his version of the Fair Tax:

When the FairTax becomes law, it will be like waving a magic wand releasing us from pain and unfairness.

The FairTax will replace the Internal Revenue Code with a consumption tax, like the taxes on retail sales forty-five states and the District of Columbia have now. All of us will get a monthly rebate that will reimburse us for taxes on purchases up to the poverty line, so that we're not taxed on necessities. That means people below the poverty line won't be taxed at all. We'll be taxed on what we decide to buy, not what we happen to earn. We won't be taxed on what we choose to save or the interest those savings earn. The tax will apply only to new goods, so we can reduce our taxes further by buying a used car or computer.

Our current progressive tax system penalizes us for working harder and becoming more successful. As we climb the ladder, the government lurks on each rung, hungry for a bigger bite out of our earnings. The FairTax is also progressive, but it doesn't punish the American dream of success, or the old-fashioned virtues of hard work and thrift, it rewards and encourages them. The FairTax isn't intended to raise any more or less money for the federal government to spend - it is revenue neutral.

There are a lot of different points to be made. Easily dismissed is the claim that the Fair Tax will release us from pain and unfairness. Such a silly claim gets at the unseriousness of the Huckabee campaign in general. More substantively, only six countries have ever adopted retail sales taxes at rates of 10% or more; none do now. 58 Fla. L. Rev. 1043, 1048; Joel Slemrod, Presentation to the President's Advisory Panel on Federal Tax Reform: The Costs of Tax Complexity (Mar. 3, 2005), available at http://www.taxreformpanel.gov/meetings/ docs/slemrod 03032005.ppt.

Huckabee next says that all will get a monthly rebate for purchases up to the poverty line. This argues against one of the main points that he promotes in arguing for the Fair Tax: administrative ease. Huckabee has argued for abolishing the IRS, but it seems that he would have to replace it with some other agency by which to mail out every American’s monthly rebate check. The type of money being passed through the mail would also invite all sorts of criminal behavior (remember how well the debit cards went after Katrina?).

Huckebee also says that the Fair Tax will create positive incentives for saving. That is probably true. Through a combination of zero tax on savings and the dramatic increase of goods after the Fair Tax is enacted, people are likely to refrain from spending. The Fair Tax creates the incentive to withhold income from being put back into the economy. How this will affect the economy only an economist could predict, but the incentives seem to lead to a slowing of the economy as people withhold their dollars from the marketplace. However, eventually, even savings will be taxed as they are spent. The savings argument is misleading because it really only marks a delay in taxation, not an abolition of the tax on savings.

Huckabee argues that both taxes are progressive. However, the Fair Tax is difficult to make progressive. Since the tax applies to all at the point of sale, regardless of economic status, it would generally appear to be either a flat or regressive tax. The single rate of taxation on purchases hits low-income people harder than high-income people because the purchases are a larger proportion of the low-income person’s wealth. Higher income people are able to save a larger portion of their earnings. Thus, even with the rebates he proposes, for anyone above the poverty line, the tax is regressive. To make it progressive, Congress would have to add in additional complexity Graduated tax rates, differential rates, or higher rates all would lead to increasingly complex taxpayer behavior and legislative and administrative responses. 88 Calif. L. Rev. 2095, 2141.

In sum, and these certainly aren’t all the points to be made about the Fair Tax system, the Fair Tax likely does little to improve the current tax system and likely does harm. It does little to improve the complexity or administrative burden. It only shifts the time of taxation from when it was produced to when it was consumed. Finally, it likely dulls economic growth by creating a disincentive to spend.

Beyond its inherent political impracticability, the Fair Tax should be rejected. The better alternative, and the more realistic one, is the one Mitt Romney has proposed: lower marginal rates, end the death tax, end taxes on savings, and lower corporate taxes. These things combined will do more for the economy and the nation than the enactment of the Fair Tax.

National Review Endorsement

It seems like this news has been buried in the wake of The Speech but yesterday the National Review announced its endorsement of Mitt Romney.

"More than the other primary candidates, Romney has President Bush’s virtues and avoids his flaws. His moral positions, and his instincts on taxes and foreign policy, are the same. But he is less inclined to federal activism, less tolerant of overspending, better able to defend conservative positions in debate, and more likely to demand performance from his subordinates. A winning combination, by our lights. In this most fluid and unpredictable Republican field, we vote for Mitt Romney."

National Review editor Rich Lowry talks to Hugh Hewitt about it here.

Excerpts From "The Speech"

There's less than thirty minutes until The Speech. The campaign has released some excerpts ahead of time. Read along if you like.

Update: The Wall Street Journal has posted the entire text of the speech.

Update II: Let's try this again. Here it is from NRO.

Thoughts?

Mistake Or Masterstroke?

As Dillon's last post shows, a good number of people wonder whether the "Mormon speech" is necessary (this while a good number have also been pounding the speech drum). While it could pay dividends, I think the speech is a risky move. It's anyone's guess how it will turn out. Over at the Atlantic Monthly, Mark Ambinder outlines what he sees as the pros and cons of such a speech, while Ross Douthat makes the case for why he thinks the speech is a mistake:

Put me down in the "it's a big mistake" camp. The speech should have been given at the very beginning of the primary season, or after Romney won the nomination; it doesn't make sense to give it in response to Mike Huckabee's rise in the polls. Huckabee is vulnerable on all sorts of issues, and Romney has the money and the infrastructure to make sure that every GOP primary voter in America - let alone Iowa and South Carolina - knows all about the tax increases and the ethics complaints and the softness on illegal immigration and all the rest of it. Going after Huckabee on these issues probably wouldn't prevent the Arkansas governor from consolidating his current level of support, but the right line of attack should be able to stall his momentum in states like New Hampshire and Michigan and South Carolina, where Romney is well-positioned even if he loses Iowa.

But instead of making the conversation about issues where Huckabee is vulnerable and Romney isn't, the Romney campaign has guaranteed that for the next two weeks at least and probably beyond, the media conversation will be about, well, Mormonism. If there were more time before the actual voting begins, that might not be the worst thing in the world; they could get the wave of coverage out of the way, inoculate themselves to some extent, and then shift gears and start hammering Huckabee on taxes and immigration and so forth. But there isn't time: Christmas is coming, there's a very narrow window in which to define Mike Huckabee as a Mexican-loving crypto-liberal, and the Romney campaign has just ensured that everyone will be talking about the Urim and the Thummim instead of the Arkansas gas tax. Unless Romney gives the best speech in the history of speeches, I just don't see how that helps him win - in Iowa, New Hampshire, or anywhere.

So here's the question for our readers, is the speech a mistake or a sage political move? Why?

One Huckabee Burger With Cheese Please

It's amazing how fast you can get into the spotlight; but once your there you better be ready to take the heat. Everybody has been talking about how Huckabee is putting the heat on Romney; but it looks like Huck is enduring some heat of his own. An interview today on the Laura Ingraham show (linked below) was a perfect example.

After various debates many of my friends came away with a rather favorable impression of Huckabee. I explained to my friends that I understand their propensity to be attracted to Huck's smooth style, charm, and compassionate speak. Then I started to point out his faults.

While Huckabee was a 3rd tier candidate he had the luxury of hiding his past behind his charm and obscurity. As the primary comes closer and voters feel a "conservative gap" in the field they have begun to look elsewhere. These forces combined with the main stream media's hunger for a new story, and tight race, have propelled Huckabee to the 1st tier of candidates. This has significantly altered the debate and has seemingly encouraged Romney to make his infamous "Mormon Speech" Thursday.

Personally I think Romney could have just waited this out. A comparison of today's headlines with those of the past week or two explain why.

For the last couple of weeks the big story was that Huckabee was rising because Christians were becoming more wary of Romney's Mormonism and Giuliani's sketchy financial and moral dealings as governor. Now that Romney has announced he won't make the speech until Thursday and Giuliani's past is in investigatory limbo, the press and conservatives alike are passing their time investigating their new top tier candidate.

Like a new item on the Wendy's Dollar Menu, Huckabee will not last long.

Here is a taste:

http://www.evangelicalsformitt.org/front_page/ingraham_huckabee_big_loser_on.php

Can you say indigestion?

Huckabee Finn and Fred Sawyer

An astute reader sent along a link to this column by Ann Coulter. Coulter, ever the wordsmith (blunt as she may be sometimes), denounces the tendency for some conservatives to default into supporting Huckabee Finn and Fred? Sawyer:

On illegal immigration, Huckabee makes George Bush sound like Tom Tancredo. He has compared illegal aliens to slaves brought here in chains from Africa, saying, "I think frankly the Lord is giving us a second chance to do better than we did before."

Toward that end, when an Arkansas legislator introduced a bill that would prevent illegal aliens from voting and receiving state benefits, Huckabee denounced the bill, saying it would rile up "those who are racist and bigots."

In 1999, Sen. Fred Thompson joined legal giants like Sens. Jim Jeffords, Olympia Snowe and Susan Collins to vote against removing Bill Clinton from office for perjury.

Thompson, whom President Nixon once called "dumb as hell," claimed to have carefully studied the Constitution and determined that perjury by the president of the United States did not constitute "high crimes and misdemeanors." He must have been looking at one of those living, breathing Constitutions we've heard so much about.

Jimmy Carter redux

Oh the wonderful 70's, time before time (or at least before some of us, ahem, were born). It was a magical time when gas was in short supply, evironmentalists were telling us that the world was in for another ice age, and we were ending our involvement in a long war. Stagflation was all the rage and America looked weak and vulnerable. Of course we have have many people to thank for those blissful times. Prominent on that list was a southern governor named Jimmy Carter. Jimmy was a nice enough fellow, but incompetent and misguided. Of course, that's become more apparent as time has gone by, and the decision to elect him looks foolish now.

I generally don't like to make comparisons of candidates to former presidents. Most of the time the comparisons are unfair and superficial. However, the more I look at the potential presidency of Mike Huckabee, the more I am persuaded that his presidency would look like Jimmy Carter's.

It's funny how we forget as time passes at how bad the national financial situation was back then, with the gas lines and stagflation at the top of the list. The environmental movement was coming of age, also, making it particularly difficult to fix the energy and monetary problems. The Carter administration, through populist economic policies and sympathy towards environmental restrictions, did nothing to help. The nation, still sour over the Vietnam war, saw gloom and doom in a self-perpetuating negativity cycle, furthering the despair.

This, to me, is where a Huckabee presidency would take us. His populist economic policies would do nothing to help problem areas in the economy. Indeed, it is likely that they would further deepen the problem. Likewise Huckabee's affinity towards environmental restrictions would make our energy problems worse, not better. All this would add to a nation in a sour mood over our involvement in Iraq. Huckabee, like Carter at the time, is a nice guy, but misguided and capable of serious harm to the country.

I also think that we now underestimate the importance of Reagan's economic policies in turning around the national mood and healing the wounds of past national hurts. Time has dimmed the memory of how important it was to get our finances in order and the resulting confidence, in all facets of life, that it gave the nation. Mitt Romney could do for the economy what Reagan, in his time, did. He would breath new life into an overstuffed government, and allow the citizens of this great nation to feel confident once again about themselves and their country. Commitment to conservative economic policies, both for spending and taxes, is one of Mitt's hallmarks.

Imagine what Reagan could have done had he been elected in 1976 instead of Jimmy Carter. We have a similar choice again this time around. Being pro-life is simply not a sufficient condition to be president, especially when coupled with a populist economic ideology. We need a president who can lead us to economic success once again. Mitt Romney is the man that can do that.

Romney To Give "Mormon" Speech This Week

Kevin Madden early today:

"Governor Romney has made a decision to deliver a speech titled “Faith in America." The governor has been invited to The George Bush Presidential Library in College Station, Texas to deliver this address on Thursday, December 6. This speech is an opportunity for Governor Romney to share his views on religious liberty, the grand tradition religious tolerance has played in the progress of our nation and how the governor’s own faith would inform his Presidency if he were elected. Governor Romney understands that faith is an important issue to many Americans, and he personally feels this moment is the right moment for him to share his views with the nation. Governor Romney personally made the decision to deliver this speech sometime last week. While identifying a venue for this address, the campaign consulted with President George H.W. Bush’s office last week about Governor Romney’s decision. President Bush was gracious enough to extend an invitation to deliver the speech at the presidential library. The invitation to speak at the presidential library is not an endorsement of Governor Romney’s campaign."

A quick overview of the initial media reaction: CNN, NY Times, Politico I, Time, Townhall I, Townhall II, NRO, CBS, Reuters, ABC News (this is a particularly good one), Globe, Politico II, SL Trib, USA Today, Atlantic Monthly I, Atlantic Monthly II

One good thing about this is that it should finally stop the chorus call of articles and op-eds calling for Romney to give the speech. No doubt Huckabee's rise in Iowa helped Romney decide that if he was ever going to give a speech addressing his religion, now was the time for it. As for what effect it will have, I think it's anyone's guess. Your thoughts?