The latest scandals surrounding the Clinton administration have inspired more urgent support for campaign finance reform. Watergate induced all manner of reform which only spawned new methods to circumvent those restrictions. The consensus among most pundits is that new "reforms" will only change the methods of payment.

To really diminish the government-influence "market," we must reduce the size of government and thereby reduce the number of interest groups seeking favorable tax treatment and favorable regulations or policies. The less prevalent government is in our lives and businesses, the fewer reasons to seek advantage through government influence. Whether we call it "lobbying" or "bribery," the smaller government’s scope, the smaller the "influence business" will be.

A year ago, tax reforms were a hotter topic. Tax reform, done well, can deliver a good measure of campaign finance reform, too.

Seven million words define the federal tax code. IRS guidelines and rulings (interpretations of the law itself) add millions more. Unquestionably, federal tax laws are too complex.

They’re so complicated that Americans must employ the equivalent of three million full-time workers to handle tax compliance and avoidance. Annual compliance costs are estimated at $200-$600 billion. The IRS employs twice the employees of the CIA and five times more than the FBI. Could we use that money better?

The IRS carries the intimidating stick of the federal government. It can padlock your business, seize your paychecks, bank accounts and other assets all without any due process. With tax law, you’re guilty until proven innocent; the burden of proof is reversed. Something’s wrong with this picture and that explains the popularity of reducing the IRS’ size and power.

The flat tax ideas recently under discussion don’t completely address corporate taxation where the majority of loopholes and abuse exist. Nevertheless, the flat tax represents a substantial step toward overall tax reform which would save millions in IRS costs, compliance costs, and reduced opportunities to cheat.

Another attractive tax reform concept is the national retail sales tax. Its appeals are legion. It eliminates federal income measurement (43 states collect income tax) and tax withholding. Would states follow suit? It eliminates the IRS since the states collect sales taxes (45 states collect sales tax). It eliminates hidden federal excise taxes. It definitely encourages increased savings and eliminates federal compliance costs for individuals. Proponents contend that it taxes the "underground economy" such as illegal drug profits. However, increased temptation to evade tax through barter and unreported sales unquestionably spawns enlarged compliance issues. Citizens for an Alternative Tax System ( call 703-368-6113) offers details on both concepts but clearly favors the sales tax.

Despite all the skeptics’ criticisms, tax reform is an idea most Americans support. Simplicity and fairness appeal to the majority regardless of their spending priorities.

Tax reform opponents fall into three general camps: class-envy spenders, special-interests and power-holders.

The class-envy troops portray the flat tax as a tax break for the rich. Such sophistry reveals their socialist desire to punish success and stifle anything that encourages spending discipline. The working poor and lower middle class would benefit immensely given that any income under $26000 to $36000 (depending on the plan) would be completely exempt from federal income tax.

The special-interests camp opposes alternative tax systems because the current system lets them buy tax loopholes with political contributions. The complexity and volume of the current law allows these loopholes and tax breaks to be established without general publicity. The relative simplicity of the flat tax or sales tax defoliates the cover under which the special-interests creatures currently slither.

Bureaucrats and legislative incumbents dislike alternative tax plans that disable federal micro-management (via tax code) and enhance the visibility of taxes and any increases. Constant awareness of tax burdens tends to inspire spending awareness, too.

The 84 year income tax "experiment" has failed. If it’s really our government, we the people can make tax reform happen despite the opposition. Let’s do it.

 Copyright Ó1997 Steve Scroggins - All rights reserved.