Die, Evil Demon, Die

One of the things I teach is radical business process re-engineering (BPR), which suggests that much of what organizations currently do is based on what they've always done in the past. In many cases, that has little or no connection to the best way to do things today. Radical BPR argues that the best approach to improving organizational efficiency and effectiveness is often to throw out what's been done previously and start all over. Case in point:

I consider myself a fairly intelligent and well-informed person. However, I will admit to being confused, overwhelmed, and downright befuddled by both obama's and Romney's proposals to change the tax code. To me, this is a perfect opportunity for radical BPR. The federal tax code is an incestuous, unmanageable, and un-understadable tangle of complex, confusing, and contradictory regulations. It's time to toss the whole damn thing out and start over.

Scott Burns agrees with me.

He's lanky, white-haired, calm. Listen to him for a few minutes and you sense great patience, stunning analytical abilities, and a sustained passion, untainted by malice. His name is Leo Linbeck Jr. His company has built some of America's most striking buildings.

But I've come to talk about a different kind of construction, our tax system, which is broadly acknowledged to be one of the most wretched things ever built. I've come to Houston because Linbeck is a prime mover behind the idea of a national sales tax, one that would replace the entire 73,608-page tax code.

Got that? 73,000+ pages of tax code! Who the hell can comprehend that much crap?

While our tax code has been called "an abomination," it is now clear that both political parties intend to do no more than tinker with the abomination, in different ways, to rebuild America to their vision. Neither party sees that our tax code is central to our current economic mess. Linbeck thinks differently. He says that to rebuild America, we need a brand-new tax system.

Revising the existing abomination is the fiscal equivalent of arguing about how to rearrange the Titanic's deck chairs. Instead, let's concentrate on keeping the ship afloat.

When I asked how the idea came about, I was surprised by his answer. Nearly two decades ago, he was having lunch with two friends. One, the late Jack Trotter, suggested that the biggest single problem in America was its tax system. Businessmen all, they agreed and decided to do the research and development for a tax system that would work.

That's where a lunch conversation ended and the heavy lifting began. Finding little academic work on differing tax systems, they selected 25 top economists and asked if they were interested. All 25 were. They narrowed the group to eight, including Martin Feldstein at the National Bureau of Economic Research, James Poterba at MIT, Laurence Kotlikoff at Boston University and Dale Jorgenson at Harvard.

The result was a bold idea: Replace the current mess with a national sales tax. Tax consumption and only consumption. Eliminate the income tax, the employment tax and the corporate income tax. Just tax consumption.

How about that? A tax code that both businessmen and economists can agree on. And one that even liberals would have a hard time arguing isn't 'fair.'

"It's very progressive, but on a discretionary basis," Linbeck said. "If you buy a Bentley and I buy a Ford, you'll have to pay about 20 times the taxes I pay. People that spend more money will pay more taxes."

Then they spent millions to test "the market" for the tax. Result? Not only would it work, but the name FairTax came out of one of the consumer panels as well. "All I want is a fair tax," one of the panelists said.

There's something else to think about. These people spent millions of dollars of their own money to come up with a way to improve our country - to make the tax system simpler and fairer. If that isn't the definition of public service I don't know what is. It damn sure beats the hell out of community organizing (whatever the hell that is).

If the people liked the idea and understand it, I asked Linbeck, why isn't it the law? And that's where I learned, once again, that the problem lies in Washington.

They tried to get the FairTax idea, as a piece of legislation, through the House Ways and Means Committee the usual Washington way.

After six months they gave that up, Linbeck said, and decided to follow a grass-roots path.

"I'm convinced that what we have for government is a contemporary form of feudalism," he told me.

"We have an elected elite, their staff, lobbyists, the academics. Perhaps 100,000 people. It's a relatively small number of people, well-educated, well-intentioned, not bad people. But they believe they ought to decide. They gravitate toward complexity, not simplicity" Linbeck said. "If you accept a simple idea - that complexity creates opportunities for manipu­lation - then you can immediately see that the largest single tool is our tax system."

Alas, the idea may make too much sense to go far in Washington.

Amen to that, brother.

Go here for more information about the Fair Tax.

And if you agree, contact your congresscritter and higher level thief senator. (As a side benefit, the Fair Tax eliminates the IRS. Who could be against that?)

My father used to say that if enough people beat their head against a wall, eventually the wall will fall down.

It can't hurt to try...