House Republicans Mistake Central Planning for “Market-Based”
May 5, 2008
Daily Tax Report notes that House Republicans are preparing to offer a $10,000 tax credit for first-time home buyers as the Republican alternative to the housing stimulus bill (H.R. 5830), which will likely be voted on this week. This one-ups the Democrats, who were proposing something in the neighborhood of $5,000 to $7,500.
According to a press release from Rep. Lee Terry (R-Nebraska) (emphasis added):
This Republican proposal offers a market-based plan with a tax credit and other reforms that will stimulate the housing market[….]
So the idea is to use government tax policy to give subsidies to one group of people, paid for by extracting taxes from others, with the goal of distorting the decisions that would otherwise be made by individuals. That’s the opposite of “market-based.”