Jonathan Chait called my attention to something I had missed in Rand Paul’s new flat tax proposal that I discussed yesterday, Again With the Flat Tax! But as Chait pointed out, one of Paul’s reasons for his flat tax is to save us from the nefarious IRS, “We now know that the IRS, through political hacks like former IRS official Lois Lerner, routinely abused its auditing power to build an enemies list and harass anyone who might be adversarial to President Obama’s policies.” Chait responded that, first, a flat tax wouldn’t change the IRS’s ability to do this. And second, what Paul is saying is absolute nonsense: it never happened.

On the first point, this goes along with all this “Abolish the IRS” nonsense. People really think that if we have a flat tax or some other conservative wet dream, then there would be no need for a tax collector. There have been tax collectors since the beginning of civilization. But according to Rand Paul and company, if we just lower taxes enough, everyone will be glad to pay them. We know this isn’t true because throughout my entire lifetime, taxes on the rich have gone down and down and down. Yet the rich complain more about the taxes they pay now than they ever did. If they were required to pay no taxes at all, the rich would complain that they aren’t being given money because of all the “job creation” they do.

But I’m really struck by the fact that Rand Paul is using this tired old story about the IRS going after Obama’s enemies. There was never any indication of this. Even at the time. The idea that the IRS was going after conservative groups was simply the creation of the right wing echo chamber. Even since Nixon, Republicans have been desperately searching for a Democrat who has an “enemies list.” This is the conservative way: whatever they do must be done on the other side. Sadly, most of the media go right along with this — effectively enabling the bad behavior by the Republicans.

Sadly, I have little doubt that Rand Paul actually believes this nonsense. That’s the whole point of the right wing echo chamber: you never have to hear anything that disturbs you. So why doesn’t the left wing have a similarly sealed echo chamber? It is usually claimed this is because liberals are, well, liberal: they like to get a lot of different opinions. I don’t think that’s really it. I think the problem is that in the modern conservative movement, the ideas are so bad that the only way that they can be maintained by Rand Paul and company is for no counter arguments to ever be heard. How else do you continue on thinking that if only we give yet another tax break to millionaires then our economy will get a “steroid injection”?

But count on this: NBC News will not be reporting that Rand Paul is using patently false claims to justify his new tax scheme. No, it will all just be ignored. Because if there is one thing that the mainstream media know, it is that the Democrats must be doing the exact same thing. They just haven’t found it yet. But don’t worry: if they ever do, they will report on that!

Last week, Mark Thoma wrote, Blow Up the Tax Code and Start Over??? He started it with, “Here we go again with the flat tax proposals.” Of course! Because this is the start of the presidential election and the flat tax is about the only policy the Republicans have that sounds appealing. Of course, it isn’t appealing. As long as people like Rand Paul (the case at hand) stay vague, it all sounds great. It is only when they get down to the details that we see that everyone who makes less than a hundred grand a year will end up paying more in taxes.

The reason that the flat tax sounds so appealing is that everyone thinks that filing taxes is a pain. It is! Even if you just have to file 1040-EZ, it’s still a pain. No one likes paper work. So the idea that we could just write down how much money we made and multiply it by some percentage rate sounds great. But wait: that isn’t what people hate about filing their taxes. No one says, “Oh, I have no problem with all the work I do to figure out my adjusted gross income; but looking up my tax in that table! That’s just terrible!”

So that’s the truth of the matter: the marginal tax rates are absolutely the least onerous part of filing our taxes. And that’s the only thing that would change with a flat tax. And even it wouldn’t be an improvement! What’s harder: looking up a number in a table or multiplying one number with another? I think it’s a wash. So you have to wonder: why are conservatives so all fired excited about the flat tax? There’s no surprise in that answer. As with all efforts by conservatives to “reform” the tax code, the intention is to lower taxes on the rich and raise them on the poor.

This is why conservatives have a laser focus on the federal income tax: it is modestly progressive. State income taxes tend to be pretty flat. State sales taxes are regressive. Property taxes are flat. And the payroll tax — the biggest federal tax on the working poor — is highly (Ridiculously!) regressive. Forget all you hear from libertarians about how great “local control” is. The reason they believe in “local control” is because the poor are usually stuck wherever they are but the rich can move anywhere they want. Thus local governments gouge the poor and let the rich off so as not to cause them to move away.

Thoma noted that even Rand Paul admitted that his flat tax would lower the taxes on the rich. But in order to offset this, Paul claims that the tax loopholes mostly benefit the rich. There is something to that. But it is clear this is just a way for Paul to imply that his flat tax wouldn’t be a giveaway to the rich without having to actually show this. But it’s just perfect: make the one modestly progressive tax in the United State flat because that’s “fair.” But ignore all the other taxes that harm the poor.

Of course, according to Paul, his “Fair and Flat Tax” would create an economic boom. He knows this because he had the people at the nonpartisan Tax Foundation look at his plan. The Tax Foundation may be nonpartisan, but it is conservative — very conservative. Thoma — who is usually pretty restrained — commented, “I bet it would almost be as good for the economy as the Bush tax cuts. Oh wait…” But I think it is amazing that the mainstream media allow Republicans like Rand Paul to talk about the federal income tax to the exclusion of all other taxes. The only people who really care about that tax are the rich. How about we talk about the payroll tax? If we got rid of the cap, maybe we could lower that tax rate.

Perhaps I am stuck in the middle of the 20th century in terms of intellectual thought. But when I look at the great big world, I see most people involved in the process of defining themselves. In its most pernicious form, it is the good “us” versus the bad “them.” But even when it is not done for such negative purposes, it is extremely wasteful. And what’s more, those who have power in a society can easily use this natural tendency to get people behind policies that are quite bad. This is what I see going on in Europe with regard to Greece. Especially in Germany, the prevailing narrative is that the Greek people are corrupt and lazy and if only they acted more like the Germans (By invading Poland?) everything would be okay.

Last week, Simon Wren-Lewis call bunk to all this, The Eurozone’s Cover-Up Over Greece. Over the last five years, the Eurozone has given an enormous amount of money that was nominally for Greece in exchange for austerity policies. But all that money did was hold off default. The money didn’t go to Greece but rather its creditors. If Greece had simply been left to default on its debt in 2010, it would have suffered under roughly the same austerity because it wouldn’t have been able to borrow money. The only difference would be that the banks who had lent money to Greece would have lost it.

The Greek bailout was not a bailout of the country at all, but rather the (mostly) German bankers. I’ve never been able to get my head around this disconnect. After the financial crisis of 2008, everywhere you looked, people were pointing fingers at borrowers. Here in the US it was homeowners who couldn’t afford their mortgages; in southern Europe, it was governments (actually just Greece) who borrowed more than they should have. But anyone who has ever even tried to get a bank loan knows that this is not how it works. The banks are supposed to be the adults who only give out loans to worthy borrowers.

But somehow, the idea that it takes two to tango, has been lost in this discussion. And it is worse than that because we expect borrowers to want more money than they can afford. So it’s pretty amazing that €42 billion have been given away to bankers who were clearly reckless, yet they are never mentioned. They are seen as good and pure — taken advantage of by the evil Greek government, which should have known that it couldn’t afford the loans it was taking.

I pine for the days when people were more class conscious. I blame mass media. If it wasn’t for the constant assault of “respectable” news outlets repeating lies about poor deceived bankers, people would see things more clearly. Remember the founding of the Tea Party: millionaire Rick Santelli surrounded by other millionaires on the floor of the Chicago Mercantile Exchange, ranting about a law designed to help homeowners. And millions of middle class Americans — most of whom were too old to have been caught up in the housing bubble — jumped on board. There was instant common cause between the bankers and middle class homeowners who just had the good luck of being born at a better time. Or in Germany, there are working stiffs who align with the poor bankers. “Us” and “them” have been sliced and diced by the power elite for the benefit of themselves, so they will never be held accountable and so the money will keep moving from the poor to them.