MICHELE BACHMANN PRAISES ONE-YEAR INCOME TAX MORATORIUM. Okay, she’s the one with the LLM in Tax, not me, but this seems like a bad idea.

The weakness of our stumblebum “recovery” is largely based on regime uncertainty, not a lack of liquidity. Yeah, a year of no income tax would gin up spending, but only temporarily. If I were a business, I’d feel safer with a long-term ceiling on tax rates — and, better still, a moratorium on new regulations — than a one-year tax suspension. To me this just seems like “cash for clunkers” writ large.

The one argument I can see is that if Americans get used to a year without paying income tax, they’ll be much, much more resistant to tax increases in the future. I remember Harry Browne telling people to imagine how they could save for retirement, educate their children, etc. if they didn’t have to pay federal income tax. With this approach, people wouldn’t have to imagine. But if that’s Bachmann’s intent, I haven’t heard that.

Meanwhile, a commenter at the link (who claims to be a “tax guy”) thinks there would be no revenues if we had a moratorium on the income tax, but in fact I think it’s only about a third of federal revenue. Could we cut the budget by a third? Undoubtedly. Is there the political will to do so? Not now, but maybe if people got used to not paying. . . .

Still, I think this is a bad idea and my speculation about political effects is just after-the-fact cogitation, with no evidence that this is what Bachmann intends.

UPDATE: According to this it’s more like 45%. Still, not the only source or even the majority source of revenue, though it is the largest.

ANOTHER UPDATE: Reader Fran Akridge writes:

First, I think Bachmann is saying some things that will keep her from being taken seriously among old-line Republicans. I am a Libertarian Republican but I can add and subtract and even multiply and divide.

However, someone (Goldwater?) used to suggest doing away with withholding so that we would “feel” exactly how much we are paying.

I do (and you may) remember the horror of paying both sides of Social Security when I was doing almost full-time consulting work.

And I remember the horror of small business people paying both sides of Social Security when I did taxes one year – many had lost withholding jobs and were doing anything to feed their families – they had figured they would owe no income tax and had forgotten about both sides of Social Security.

Ouch.