Terrific, if horrifying, analysis from Megan McArdle of how tax policy bankrupted a lot of pensions.
We just love using tax deductions to guide public policy. Unfortunately, it always leads to making economic decisions on the basis of tax treatment rather than on the basis of rational economics. Then the IRS has to step in and try to substitute its rules and judgment for the rational economics. How many time does it have to fail? If taxes were low enough, it wouldn't be necessary to have so many deductions for things like healthcare and retirement expenses, and there's never any need for the government to micromanage how people provide those things for themselves, either.
The magic of the Left is so bright that even now people still think they are trying to "fix" things.
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