Small is Beautiful

Envisioning a radical simplification of the tax code to slay the monstrosity that is Trump’s One Big Beautiful Bill.

House Speaker Mike Johnson at the May 22nd press conference announcing the passage of the One Big Beautiful Bill Act. Credit: The Century Foundation.

If Donald Trump labels something “big” and “beautiful,” chances are it is something vulgar, overblown, and rife with the potential for fraud. Whether it’s a chronically unprofitable Atlantic City casino, a dinner held for holders of his crypto meme coin, or a jumbo jet donated by a Hamas-funding Persian gulf monarchy, if Trump calls it “big” or “beautiful” you can be sure it is profiting him and his cronies at the expense of the rest of us. Trump’s “One Big, Beautiful Bill,” passed by the House of Representatives last week, is no exception to this rule. If your definition of “beautiful” includes tax cuts disproportionately favoring the top 0.1%, kicking millions off of Medicaid, gutting funding for green energy, crippling the ability of the judicial branch to reign in an authoritarian executive, all while ballooning the national debt by $3.8 trillion over the next decade then Trump did not disappoint. But if you care about fiscal responsibility, the stability of the dollar, upholding the rule of law, the health of the American populace, or building a sustainable and dynamic economy, then Trump’s One Big Beautiful Bill is nothing short of hideous.

While Trump’s bill may not be all that beautiful, it sure is big, measuring in at over 1,000 pages long. Republicans talk a lot about wanting a smaller, simpler, and more transparent government. But when it comes time to pass legislation that parasitizes the citizenry to the benefit of the oligarchic donor class, Republicans have no problem masking their intentions behind thousands of pages of impenetrable legalese. Even Project 2025, the Heritage Foundation’s blueprint for simplifying and shrinking the federal government, published a manifesto of over 900 pages. Republicans know they need hundreds of pages of verbiage to shroud their plutocratic intentions and paper over the hollow core at the heart of their phony populist rhetoric. Trump’s One Big Beautiful Bill is just the latest installment in the decades-long collusion between politicians, lawyers, and lobbyists to create a tangled web of complexity in legislative bills, the tax code, contracts, and financial products that has served the interests of the rich at the expense of the average American.

This complicity in complexity between corporate and political elites should make Democrats consider a radical simplification of our tax code as a strategy to restore trust in government while reversing wealth inequality in the process. Unfortunately, when it comes to taxes, Democrats have had little appetite for anything more than the most incremental changes, minor tweaks barely putting a dent in the destructive upward expropriation of wealth initiated when Ronald Reagan signed the Economic Recovery Tax Act in 1981. Reagan and his successor, George H.W. Bush, were able to drop the top tax bracket from 70% to 28% in less than a decade. In the ensuing 35 years, Democrats have not even been able to push the top rate back up above 40%. Instead, once in power, Democrats look to dole out small morsels of tax benefits to “working families” and the “middle class” rather than strike at the root of a poisonous tax system that created the exploitative conditions causing average Americans to struggle in the first place.

Democrats simply have no interest in radical tax reform. Maybe it’s because the passage of the 16th Amendment (guaranteeing Constitutional protection for a national income tax) was one of the great accomplishments of the early 20th century Progressive Movement, creating greater wealth equality while powering unprecedented levels of economic growth for its first half-century of existence after ratification in 1913. Maybe it’s because, on a cultural level, tax reform is coded right wing, a hobbyhorse of grumpy populist curmudgeons (e.g. Howard Jarvis who led the California tax revolt of the late 1970s resulting in the passage of the disastrous Proposition 13), wannabe politician nepo babies (e.g. Steve Forbes whose ill-fated Presidential run in 1996 was based on a national flat tax), and conspiracy-brained anti-government nut jobs (e.g. Harvey Francis Barnard’s National Economic Security and Recovery Act, a piece of model legislation intended to end the income tax and ban compound interest that got nowhere with mainstream politicians yet remained popular within the on-line chat rooms of 9/11 and QAnon conspiracy groups). We have come to assume that any talk about transformational tax reform is for right-wing freaks and is just not something well-behaved Democrats do. But if we want to restore trust in government and turn back the tide of wealth concentration at the top, the time has come for those on the left to consider a radical rewrite of the United States Tax Code as a long-neglected weapon in their arsenal.

To counter the hidden dangers lurking within Trump’s One Big Beautiful Bill, Democrats should propose a dramatic reduction in the size and complexity of our tax code. In its current manifestation, the Internal Revenue Code is over 2,000 pages long. But the Code itself is just the tip of the iceberg. To resolve any question of the slightest complexity, over 10,000 pages of supplementary Internal Revenue Rulings and Regulations must be consulted, not to mention volume upon volume of federal case law adding greater clarity to specific questions while simultaneously creating complexity within the overall tax system. As a former IRS tax attorney married to a private sector tax attorney, I can confidently say that no individual human being could ever grasp even a small fraction of the entire body of our nation's federal tax law. Within the impenetrable complexity of the Tax Code, citizens lose trust in government, lose any idea of who pays what to the Treasury, and lose what little sense of class solidarity that remains in American society, lured by tiny nibbles of tax cuts given to them by legislation like Trump’s One Big Beautiful Bill (e.g. no tax on tips) while the richest 0.1% are served a veritable feast of benefits financed by the already overstretched credit of the federal government. Variable marginal rates may make our Tax Code look progressive on its face, but the ample loopholes and workarounds within it have made the Code an engine for regressive wealth distribution over the past half century, creating frustration and distrust toward government that Republicans never fail to use as an on-ramp for recruitment and radicalization.

Reagan promised radical changes to the American tax system and did not fail to deliver. It is well past time for progressive Democrats to offer their own radical change to the Tax Code that reverses the devastating impact Reagan’s policies had on wealth inequality, the national debt, and the funding of administrative agencies. To seize populist momentum from Trump and the Republicans, Democrats should propose a radically simplified and shortened Tax Code that every interested citizen could read in a matter of hours rather than a gigantic tome several times longer than the Bible that no individual could fully grasp over the course of a lifetime. Through this radically simplified Tax Code, Democrats could radically simplify the financial lives of the average American by eliminating the need to file income taxes. It’s hard to think of a better way for Democrats to reclaim their status as the party of the working class than by no longer taxing the fruits of the citizens’ labor. In place of the over 2,000-page Internal Revenue Code, there would be a new 25-Page Tax Code that generates the same or more revenue than the current system through three major sources:

Wealth Tax

All Americans with a household net worth of $1 million or more would owe a Wealth Tax. Unlike the current income tax system, which absurdly cuts off the highest bracket at $751,600, the Wealth Tax would be a highly graduated system, charging no more than 2% on households with a net worth below $50 million yet topping out at a rate of 10% on fortunes above $10 billion. A highly graduated Wealth Tax reflects the reality that there are exponential differences in wealth between Americans who currently fall in the highest income tax bracket. Many of us have met someone who makes more than $750,000, but the same cannot be said for someone making more than $75,000,000. Someone making $750,000 yet strapped with college debt and a hefty mortgage could be living a seemingly modest lifestyle in America’s most expensive cities. Someone making $750,000,000 lives an existence completely alien from the average American, having so much money that their wealth often becomes a threat to themselves, their family, and, as we have seen in the past election, a threat to democracy itself. Treating these two individuals the same in our current tax system gives a false impression to the general public that the ultrawealthy are not that much different from the rest of us, and that a tax cut for them could be as beneficial for the economy as a tax cut for us. The Wealth Tax proposed in the 25-Page Tax Code, recognizes that, at a certain point, money ceases to be an economic asset and becomes a mechanism for political control. Taxing concentrated wealth is about more than just raising revenue for government programs. It is about curbing the ability of unelected elites to hijack our democracy. Given that the current Supreme Court majority are proven servants of the oligarchy, the best way to secure a Wealth Tax is through a 28th Amendment to the Constitution. In our age of cynicism, many Americans feel a constitutional amendment is no longer possible. Yet, by offering an end to income taxes for all Americans, the Democrats could use an attempt at a 28th Amendment Wealth Tax as a way to channel populist energy while drawing an unmistakable line in the sand between which party serves the moneyed elite and which party serves the people.

Consumption Tax

The Consumption Tax would operate similarly to a national sales tax or a Value Added Tax (VAT), charging a base rate of 10% on all transactions where at least one party resides in the United States. Admittedly, sales taxes are in and of themselves regressive, as the poor spend a far greater proportion of their money on consumption than the rich. To make the Consumption Tax progressive, zero or even negative rates (essentially a subsidy) would be charged on necessities such as food staples, housing, medicine, and basic clothing. Rates above 10% would be charged on products that harm consumers, the broader population, and the environment. Rather than distort the free market, these punitive rates would be used to internalize costs inflicted on society by externalities not captured in current prices. To keep the 25-Page Tax Code within its page limit, the total number of rate adjustments would be limited to 200 variances from the 10% baseline.

Financial Transaction Tax

A 1% transaction fee would be charged on the sale proceeds of all stock, bond, FOREX and cryptocurrency trades on U.S.-based exchanges or on behalf of U.S. citizen customers. The whole point of the financial system is to connect savers who have excess capital to entrepreneurs and businesses who have the ideas and the will to create value yet need more capital to do it. Unfortunately, in our age of “financialization,” only 15% of money in the financial system goes to starting businesses or facilitating the creation of physical assets that improve human life. The vast majority of money in the financial system is used for speculation, the endless buying and selling of existing assets, trading activities that benefit mostly those in closest contact with knowledge and power (not to mention the financial sector that rakes in fees with each transaction). To encourage long-term investment over short-term speculation and to mitigate the wealth concentration effects from excess financialization of the economy, the Financial Transaction Tax would assure that the United States government gets a 1% cut on the value of every stock, bond, FOREX, or crypto transaction. Financial service companies and brokerage houses often charge far more than 1% in fees for executing these transactions. The United States government is more than justified in taking 1% for providing the legal system and international reserve currency that form the very foundation of the American financial industry.

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Trump’s One Big Beautiful Bill is not a done deal. There is still some hope that Senate Republicans have enough shreds of integrity left to rewrite the bill so it bears little resemblance to the hundreds of pages of slop House Speaker Mike Johnson managed to get passed by a razor-thin margin in the wee morning hours of May 22nd. But even if Senate Republicans bow to Trump and give him a funding bill he is happy to sign, I don’t expect much talk of the need for radical tax reform from establishment Democrats.

I know the idea of shrinking our tax code to only 25 pages is not an idea that the technocratic policy experts of the Democratic Party would bother to even consider. We have been trained to believe that our economy and society could not function without the arcane secrets hidden within 1,000-page legislative bills and 10,000 pages of tax regulations. We are not much different than the ancient Egyptians who believed the incomprehensible incantations of the priestly caste kept the tears of Isis flowing to bring the nourishing floods of the Nile, or the medieval serfs who were taught that only the complex webs of feudal relations kept the Great Chain of Being from unraveling. We should stop and consider whether our current elites, who prosper through the complex systems they created and maintain, are any more necessary to our existence than the priests were to the existence of Egyptian peasants or the feudal lords were to the existence of serfs in Ancien Régime France. If a radical simplification of our tax code sounds like a Revolution or Reformation, that’s because it should. It should be shocking, it should seem outlandish, because the Democratic Party desperately needs policies that grab voters’ attention and offer something more than just mitigation of damage done by Republican policies like Trump’s One Big Beautiful Bill. The 25-Page Tax Code would provide a much-needed renegotiation of an American social contract that has too long been rigged in favor of those at the top. This nation was born out of a dispute over taxes. America could be reborn as a stronger and more just nation if Democrats would only recognize the power that radical tax reform has to mobilize and inspire the masses.

END NOTE: If you are interested in collaborating or contributing to the 25-Page Tax Code Project, let me know in the Comments or via Direct Message.