Showdown at Gucci Gulch

Showdown at Gucci Gulch chronicles the tax reform effort in the early-mid 80s during the Reagan administration. This was a notable law making effort as it closed many tax loopholes while removing roughly 4M lower income people from the tax rolls. All of this occurred during a Republican administration who had recently passed a separate tax act in 1981 which many argued increased loopholes and was approaching anti-reform. Written by two Wall Street Journal reporters in 1987, roughly a year after the Tax Reform Act passed, the book is a time capsule for that political period. It is also a great insight into policy making and the legislative process. It follows the reform effort from early failed efforts to the final bill coming out of conference committee. Despite the fact that this might appear to be a rather dry subject, the book wraps it in a readable narrative with compelling political characters. You appreciate how difficult policy making, and particularly tax policy making is. I picked this one up because of the 2017 tax “reform” and I was struck by the parallels in some of the proposals and yet very different final outcome.

Interesting Tidbits:

  • I found the NBA player turned senator, Bill Bradley, to be an interesting figure that I knew little about.
  • There was a swapping of Chief of Staff and Sec. Treasury during this process: Jim Baker <-> Donald Regan
  • During one of the proposals it was calculated that tax income levels should be 16/28/37%, these were eschewed for the better “sounding” 15/25/35
  • Big miss-calculation: Off by 150 B being added to deficit was blamed on a “programming error”
  • “Write Rosy” and Dan Rostenkowski

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