President Obama insists that healthcare reform is crucial to economic recovery. That seems like wishful thinking: reform seems more likely to slow recovery than speed it. Still, long-term reform might be worth the short-term price. Franklin Roosevelt thought it was.

New Jersey's personal income taxes went up yesterday. Married couples and single filers will pay an 8 percent rate on income earned from $400,000 to $500,000 -- up from the 6.37 percent rate. The rate on income from $500,000 to $1 million will now be 10.25 percent, up from 8.97 percent. And income earned over the million dollar mark will now be taxed at a 10.75 percent rate. That is the second highest rate in the nation behind Hawaii. Folks making more than $250,000 will also lose their property tax deduction next year. The income tax changes will raise about $1 billion of badly needed extra revenue. New Jersey did the right thing by raising its income tax on the state's wealthiest citizens.

These days we hear a lot of talk about tax havens. If the headlines are to be believed there is a global crackdown on offshore tax evasion. That's good news, if it's true. I pay all my taxes, so it's only natural I'm peeved that others avoid paying their fair share by stashing money away in a foreign bank account and then lying about it on their U.S. tax return. What worries me, though, is that this crackdown might be more spin than substance. I hope I'm wrong.

It was only last fall that Fed Chairman Ben Bernanke uttered those terrifying words to congressional leaders, warning them of what would happen if they failed to take radical steps to support the financial sector. Most of the world is still reeling from the Great Panic of 2008. It seems only inside the Beltway bubble can the troubles ignited by the financial crisis be easily ignored.

Bob McDonnell is the GOP candidate for governor in Virginia. While I probably won't vote for him, he has guts. McDonnell refused to "take the pledge" never to raise taxes. Most politicians take the pledge because they are afraid of being labeled pro taxes. Most take the pledge because they are afraid of Grover Norquist and his band of right wingers at the Americans for Tax Reform. McDonnell, a career military officer and a very conservative guy, proved he was not afraid. Indeed, he announced he would not take the pledge at an editorial meeting of the Washington Times. The Times, the mouthpiece of the braying voices on the right, pilloried him and implied he was soft on taxes. But McDonnell was right to reject the pledge.

Okay, I am officially blogging. Every morning I am going to try to say something provocative, usually in the state and local tax area. Just so you know, I am a liberal in the sense that I believe the government can and should play a role in making this world a better place. I support progressive taxes to pay for government. It does not bother me one bit to ask a guy making $1 million a year to pay a greater percentage of his income in taxes than the guy making $40,000. But I am a believer in principled tax policy. There are right and wrong ways to impose taxes. For example, most states tax most business purchases. From a tax policy perspective that is awful. And there are right and wrong ways for politicians to approach taxation. The post that follows illustrates that issue.

Over the weekend, President Obama opened the door to a new tax on employer-provided health benefits. Speaking on ABC's "This Week," his chief political adviser, David Axelrod, acknowledged that such a tax would violate Obama's promise to avoid new levies on anyone earning less than $250,000 a year. But Axelrod stood firm, refusing to reaffirm Obama's categorical pledge. "One of the problems we've had in this town is that people draw lines in the sand and they stop talking to each other," he said.

An 80 percent tax on short term capital gains! Sounds like the liberals are taking over, doesn't it? But this radical proposal was not offered by Ralph Nader or MoveOn.org. It came from a former CEO of one of the nation's largest and most prestigious corporations.

Is the climate bill passed late last week by the House of Representatives, called the American Clean Energy and Security Act, really a tax bill? I don’t know this for certain, but I’d bet Rush Limbaugh would say “Yes” and Nancy Pelosi would say “Oh, no.”

The budget crisis we are now facing will make the budget crises of the 1980s and early 1990s look like child's play.

I write for Tax Analysts, the premier tax publishing company in the world. On July 1, I am going to start blogging. I hope you enjoy my posts. They will be fun and funny or not. I will be writing about state and local taxes. There are lots of things to say. I hope you will comment and we can get a dialogue going. Check often, as I will be posting as issues arise. Okay, that's all for now.

We are in Round Three of California's great budget battle. A few days ago it looked like the drama might mercifully be coming to an end. But on Wednesday, legislative leaders failed to get the necessary two-thirds supermajority for their latest plan. If there is not a budget agreement by Tuesday, the state will have to issue IOUs instead of checks to pay its bills. This will devastate the state's reputation with credit rating agencies and financial markets.

By now, just about everybody knows about the horrible and deadly collision of two trains on the Washington, D.C., Metro system. But did you know that sale-leaseback tax arrangements may have locked the Washington Metropolitan Transit Authority “into using outdated and unsafe equipment and thus made this crash even more deadly than it might otherwise have been”?

What is it? The Ghost of Christmas Future? No. Even scarier! It’s the “Death Tax.” And it’s extending its boned hand toward you to pick your pocket.

For its own sake, American business should be pushing for corporate tax reform.

Robert Reich reminds President Obama to stand firm on taxing the rich: "Demand that taxes be raised on the wealthy to ensure that all Americans get affordable health care. At the rate health care costs are rising, not even a real public option will hold down costs enough to make health care affordable to most American families in years to come. So you'll need to tax the wealthy." Does Obama really need the reminder? Pretty much every tax idea coming from the White House targets the rich. In fact, some would say (read: I would say) that's been the problem from the start. Democrats are in a revenue bind precisely because they want to target the rich -- and only the rich.

Public opinion polls and bookmakers' odds all point to the Conservative Party being swept into power in the next British election -- most likely to occur in May of 2010. That's a striking contrast to the U.S. where President Obama has made liberalism cool again. Thoroughly uncool Gordon Brown will be out. And the conservatives -- before the election -- are talking about reducing the national debt by cutting spending.

California's budget crisis is reaching epic proportions. Sacramento is in turmoil. And, unfortunately, the tenor of the debate has not progressed beyond that of a schoolyard shouting match. Conservatives blame excess spending on unions, immigrants, and bloated bureaucracy, while Democrats complain about corporate tax loopholes and constitutional roadblocks to tax increases.

The cell phone law that's getting a lot of press these days dates back to the late 1980s when cell phones were as big as shoe boxes and only guys like Gordon Gekko had one. This law is so bad that just the other day, the Secretary of the Treasury and the head of the IRS asked Congress to get rid of it. And I say, good for them! Apparently, these guys live in the real world.

For an idea routinely dismissed as a political nonstarter (most recently by me), the value-added tax sure gets a lot of press. In recent weeks, we've seen articles by VAT fans (like Bruce Bartlett here), VAT foes (like Dan Mitchell and Chris Bergin), and an army of VAT skeptics (Ezra Klein, Tyler Cowen, Marty Sullivan and many others). These folks disagree on the desirability of a VAT, but they stand united on its prospects: "vanishingly unlikely," in the words of Kevin Drum.

Matthew Yglesias has a great article in the current issue of the The American Prospect arguing that progressives should rediscover the virtues of taxation. Until the 1970s, he says, most Americans considered taxes a necessary evil. But over the last thirty years, egged on by conservative political leaders, voters have focused less on the "necessary" and more on the "evil."

Yesterday I read in Bloomberg that the number one taxwriter in the U.S. House of Representatives – that would be one Charles Rangel from New York – says the House is considering imposing a tax on drug makers by taking away their deduction for advertising expenses. Now there’s tax policy at its best! Maybe we can have a marginal tax apply based on how annoying specific commercials are.

Big reforms need big taxes. Belatedly, a few lawmakers seem to be coming to that same conclusion about healthcare reform. Apparently, they're even talking about a value-added tax to pay for it. That's a great idea. Or it was, several months ago.