Stuart Taylor, Jr’s attack on race-conscious congressional districting would be easier to take seriously if he evinced any real sympathy for the idea that it’s good to have some non-white folks in the congress. The way to do that would be to propose some alternative to racial gerrymanders. And fortunately, there’s an easily available alternative. Instead of having 7 variously gerrymandered congressional districts, a state like Alabama could simply elect seven House members via single transferrable vote.

In larger states you’d need something a bit more complicated—break a state down into two or three or four large multiple-member districts. Either way the point is that you wouldn’t get a state that’s 35 percent black sending a lilly-white congressional delegation unless race some day stopped being a significant influence on political preferences.

The way the current Voting Rights Act stands, it seems likely that states wouldn’t be allowed to do that. It would, however, be relatively easy to fix the legislative language in order to make multi-member districts a way for states to meet their VRA requirements. Whether state legislatures would actually take advantage of that opportunity, I couldn’t say, but I think it would be a big improvement to the American political system for a variety of reasons of which handling the minority representation issue better is just one. The only real downside is that since it’s unfamiliar to Americans who’ve never voted in a Cambridge, MA city council election, initial implementation of STV would probably confuse a lot of people. That said, jurisdictions that use STV work just fine and I’m pretty sure the American people would figure it out after a cycle or two.

At the end of the day I think this reform has a lot more promise than much-hyped proposals to curb gerrymandering through special councils and panels and such.

One issue that naturally arises on the subject of consumption taxes is whether you can’t act to make them progressive. For example, Paul Holmes says:

There’s no reason a consumption tax has to be regressive. You can exempt certain goods (I would start with foodstuffs and children’s clothing, certain health-related products from tampons to cough medicines) on which poorer people spend a disproportionate part of their income, and make a consumption tax that is far more progressive than our current tax system, and far easier to evade. I’ve never been quite sure why American liberals are resistant to this kind of VAT.

I spent a healthy chunk of January playing around with Consumer Expenditure Survey tables to try to devise just this sort of clever scheme. It turns out to actually be really hard. The problem is that if you look at spending by household income quintile the bottom quintile actually spends a larger share of its income on every CES category of goods and services than does the top quintile.

This, in turn, is because the bottom quintile spends $22,304 a year but only earns $10,263 in pre-tax income. Poor people, in other words, are liquidating savings or going into debt (the bottom two quintiles are older than the top three, suggesting that many low-income households are actually retirees). The top quintile, by contrast, earns $158,652 and spends $97,003. So while you can use exemptions of certain types of goods to make a consumption tax somewhat less regressive, fundamentally regressivity is built into the system in virtue of the much higher consumption:income ratio of the poor.

One thing you might say to that is: Who cares? Part of the point of consumption taxes is to encourage savings and investment that boost growth over the long-run. So maybe the right thing to do is to structure a system that’s progressive with respect to consumption and not worry about non-consumed income. In that case, if you exempt non-restaurant food and cheap clothing from taxation, you’ll have a system where taxes are a smaller share of poor households’ consumption, though still a larger share of their income. It’s worth noting that utilities are a quite high share of poor households’ incomes, so that policies that increase the price of electricity (cap-and-trade, carbon tax) are the reverse of the spirit of this proposal.

Another thing you might say is that it’s fine to have a regressive as long as you have a progressive tax system. Which is to say that you could raise 70 percent of your revenue through a regressive consumption tax and then go get the remaining 30 percent from a sharply progressive income tax. That would create a system that’s progressive in its overall impact, but still features lower marginal income tax rates than our current system.

I’m struck by how little attention has been given to the tough hits dished out by Bush administration Treasury Secretary Hank Pauslon to various prominent congressional Republicans, including golden boy Eric Cantor.

Newsweek summary:

Meetings with Senate Republicans were “a complete waste of time for us, when time was more precious than anything” (page 275). Ideas that Republicans do add are “unformed,” like Virginia Rep. Eric Cantor’s plan to replace TARP with an insurance program. In a rare moment of sarcasm, Paulson goes off on the minority Whip: “I got a better idea. I’m going to go with Eric Cantor’s insurance program. That’s the idea to save the day” (page 285).

Politico, reflecting its usual shallowness, remarks:

But Republicans may have the last laugh: TARP is, arguably, the most unpopular federal program in recent memory — and voters seem poised to punish Democrats for passing it, even if Republicans like Cantor eventually signed off.

Well hardy-har-har. Some of us, though, are less interesting in the timing of who laughs when than in the formulation of national policy. The fact that Cantor had an approach to a severe economic crisis that attracted nothing but derision from his same-party Secretary of the Treasury seems noteworthy to me. The national press has, however, done an absolutely horrible job of putting conservative TARP-bashing in appropriate context as a program deemed necessary by all the leading officials in a very conservative administration to avert a Depression. If this stuff is just hypocrisy, that’s bad and noteworthy. But Paulson’s message seems to be that it’s not just hypocrisy, but rather genuinely frightening cluelessness.

Maya MacGuineas emailed me with regard to yesterday’s post on Jim Kolbe to remind me that he was the author of a Social Security plan that did include some tax increases and that was, in her mind, “both fiscally responsible and politically courageous.” I will, indeed, give him some points for political courage. The various iterations of Kolbe’s ideas—initially in partnership with Charlie Stenholm, later with Alan Boyd—were among the most fiscally responsible versions of Social Security privatization out there.

At the same time, the embrace of privatization schemes by the soi disant deficit hawk community is one of the reasons that the Concord Coalition crowd has fallen into such discredit on the left. Changing demographics and (to a much lesser extent) growing income inequality have created a situation wherein promised future Social Security benefits will exceeds projected future payroll tax revenues. The obvious solution to this is some combination of higher taxes and reduced payouts, with the balance between the two going to vary according to your political tastes. Given that there’s also a substantial fiscal imbalance facing Medicare, and given that you can use money (i.e., Social Security benefits) to buy health care services, my preference would be to not cut Social Security and just look at Medicare. But tastes will differ.

The thing about Kolbe’s plan (PDF) is that like all privatization plans it introduces a gigantic new budgetary problem by diverting payroll tax money into a forced savings program. Consequently, as observed in James Horney and Richard Kogan’s classic CBPP report, these plans generally actually led to an increase in federal debt outstanding in 2050. The Kolbe-Boyd plan was far more responsible than most of the alternative privatization plans and led to only a very small increase, but the whole endeavor still smacks of a strongly ideological hostility to the program rather than a particular focus on the deficit. You could implement Kolbe’s tax increases, and then just implement a small sub-set of his proposed benefit cuts, and leave the whole privatization business out of it and I think you’d have a better plan.

It’s also worth noting that there’s a technical problem with the Kolbe-Boyd plan wherein they overstate the savings that could be achieved by adopting the C-CPI-U measure of inflation.