Tax competition and the deficit

Germans are starting to get used to the idea that Angela Merkel of CDU will be the next chancellor, and Czechs are starting to get used to the idea that Mirek Topolánek of ODS ... perhaps won't be the next premier after all. Merkel is on the way to victory despite CDU's rather weak tax plan. Topolánek, in contrast, might lose the elections even though ODS's tax plan is rather strong. ODS's problem - other than Topolánek himself - is that ČSSD has usurped the tax issue. ODS will likely have to support most of ČSSD's tax ideas in Parliament this fall and then promise even greater tax cuts of its own for after the elections. Taxpayers stand to gain from all this tax competition. As in Germany, though, Czech politicians are paying less attention to the deficit. To paraphrase Pete Peterson, author of Running on Empty, who's going to push the cart if everyone is riding in it?