The corporate income tax one is pretty terrible too. Of course corporate managers will reinvest this windfall money in their companies rather than increasing their own compensation or paying it out to stockholders as dividends! How could anyone possibly think otherwise?
It will be trivial to work out the consumption taxes juuuuuust right so that they're progressive! And that gas tax, too, that'll be easy to calibrate so it doesn't screw the poor.
It's also weird that they list eliminating the corporate income tax separately from eliminating all income taxes. Almost makes you think their panel wasn't quite as unanimous on these as they suggest.
Taxes discourage whatever you're taxing, but we like income, so why tax it?
Airtight.
Also, if taxes discourage whatever is taxed, why are we taxing consumption? Don't we like that too? Wouldn't it lead to hoarding of money, which is bad for the economy (and government revenues, since consumption taxes are apparently replacing income taxes)? The nice thing about a progressive income tax is that it's dead simple--tax brackets are actually not hard to work with--and since income is pretty much universally useful, since it's just $, you can let people decide what to do with their post-tax income and not have to worry about it very much. It's already been taxed!
(I also confess that don't see how, exactly, income taxes depress income. My employer doesn't pay them, so it won't influence its decision to pay me more or less. And I'd be perfectly happy to pay more in income tax as a result of receiving more income. But I can very easily see how increased consumption taxes would depress consumption. Presumably an economist could instruct me here.)
And of course we hate consumption, so let's tax that instead.
I also confess that don't see how, exactly, income taxes depress income.
Nero Wolfe is always lazier towards the end of the year, when any additional income he gets will all be in that top bracket!
But he'd still be getting more money on balance! If the idea is that he pushes those jobs off to the next year, then ... all he's doing is capping his income because he doesn't understand how tax brackets work? (I suppose for someone who works by cases, whose income might fluctuate a lot from year to year, that wouldn't be the case. Perhaps I miss something more weighty, though.)
If you wanted to set a consumption tax high enough to replace all income tax revenue, but simultaneously leave the poor alone, it basically becomes a tax on the middle class only, right?
Also an economist can talk about encouraging income, but could just as easily talk about the declining marginal utility of money as incomes rise. Choices!
Also an economist can talk about encouraging income, but could just as easily talk about the declining marginal utility of money as incomes rise. Choices!
It's almost as if these issues are complicated and it's not actually possible to design an ideal policy in vague terms from abstract theoretical principles!
Relevant comment by Jimmy Pongo. They shoulda listened to Barney Frank! Also I really want to know Dean Baker's true opinions about all this. Isn't he not a fool?
The thing that really annoys me about this kind of bullshit is that there are lots of economists out there doing solid, empirical, non-flashy work to evaluate, design, and implement policies taking all the complications into account. But the discipline's reputation gets defined by these academic and think-tank types making airy pronouncements based on very simplistic versions of economic theory. And somehow those pronouncements always seem to favor policies that are also totally coincidentally favored by rich people and corporations, who also totally coincidentally give a lot of money to the economists' institutions.
And I'm not even an economist! But I do work with some, and they're nothing like this at all.
I like that they included someone from George Mason, as an extra "fuck you" to, well, everyone else. And exactly one person remotely on the left.
10: I can imagine two probably-not-great ways to hit the rich: first, discriminate based on kind of consumption (tax yachts at higher rates than consumer goods), which is subject to classification issues. Second, make it progressive in total consumption per year, possibly hitting a marginal rate greater than 100%. That has bad effects in years people need to buy big ticket items (cars, mainly, assuming we don't count houses as consumption). Maybe you'd have to allow people to amortize their consumption.
Those are still awful, though. Tax income, wealth, and vices the state has an interest in preventing.
It's interesting that they didn't include a Georgist land tax on the list, actually. It's certainly a policy more popular among economists than among politicians.
It's been years since I've worked with Dean, so it's possible things have changed or that I misunderstood him back in the day, but my understanding is that he would only support most of these policies in the context of a radically more egalitarian/socialist economic system. The only one of these policies I've ever heard him defend on its own is ending the mortgage deduction.
18: Oh, yeah. Of course. Although is the Georgist case any different from that of taxing wealth in general?
Dean Baker is fond of the "here's my nifty contrarian idea* that also handwaves away 10 billion other issues and the theory of the second best," just from a left-ish perspective. I disliked him before it was cool. Fuck 'em all, also 13 is totally right. Economists are useful for lots of stuff but not this fuckery.
Although is the Georgist case any different from that of taxing wealth in general?
Hm, not sure. Sounds like we need an economist!
8,9: It would not be out of character for Nero Wolfe to put an extraordinarily high value on leisure. That's the way I've always rationalized it.
Asterix is for extra mystery
Obelix is for full disclosure.
The Cubs should do something right about now
Ezra Klein was a huge pusher of "Health care benefits must be taxed as income" back when he was a "health care wonk" instead of "nebulous liberal pundit celebrity". First all it is only common sense and intuitively obvious that people should have to pay taxes on things they receive that aren't money, and can't be exchanged for money, and in this case isn't anything at all unless the person uses the benefits. Surely it will be easy to explain why this is common sense. People might even be happy to find out how valuable their health insurance benefits are, and this will rationally encourage them to bargain for more money instead of more health insurance because they will hate being taxed on their health care benefits! Thus creating a nudge to transition slightly faster away from health insurance being tied to your job, so without any clumsy government mandates we organically leave that irrational employer-based system somewhere around the year 2186 instead of 2189. It's win-win-win.
Baker is on the panel, did nobody listen to it?
I'm just gonna rant about #1 for a bit because while I'm looking forward to taking advantage of it a great deal it's a terribly stupid way to go about incentivizing home ownership. Somebody correct me if I misunderstand how this works:
The mortgage interest rate deduction is a leap frog for upper middle class households over the standard deduction into all manner of other deductions. Back of the envelop a California couple making 70K combined can become house-poor getting into a 400K mortgage and, after the state income and property tax deductions, get a $5 grand tax subsidy, covering nearly half of the mortgage interest that got them there. If one of them can then moonlight a side gig and tally up "small business expenses" buying dinner for "clients" every meal out is subsidized at 28%, and countless other trivial deductions -- $250 for a teacher's school supplies, check -- become available at this point, plus you then get that play option to redirect government spending towards your pet issues, because your charitable dollar goes untaxed, subsidizing your giving by that 28% or whatever your marginal tax rate is. Why give it to the government and their abortions when you can give it to the church!
Politicians make all this noise proffering tax deductions that sound like they're doing something about some problem but all they're doing is subsidizing 25-35% of a small handful of people's expenses, and the more you make the larger the subsidy. Renters have access to none of it but nevertheless pay the interest and property taxes. For the majority of home owners it comes in too low -- even with the state and property tax deductions -- to get over hump of the standard deduction. But all those other deductions incentivize those in the 70-99% tax brackets that at some point had the down payment to stay highly leveraged in real estate: at some sufficiently high income with a sufficiently large mortgage in a high tax state the deductions are basically covering the interest. Who wouldn't borrow at 0%, aside a Republican congress?
I'm pretty sure virtually nobody hearing some pol blathering about making this or that screwball line item deductible understands that it'll help virtually nobody that needs help.
The Cubs should have done what I told them to do instead of getting three outs.
Of course I didn't bother listening to the panel; I wouldn't listen to Planet Money if you reduced my taxes in exchange. Plus I doubt it's a good format for actually getting his straight opinion at any reasonable length.
I haven't listened to Planet Money in so long I forgot how bad it was. None of the panel gets more than a few words in, Baker's only bit is to basically get cherry picked quoting from http://cepr.net/blogs/beat-the-press/how-to-think-about-the-corporate-income-tax for an even libruls agree.
I heard this episode when it came out! Planet Money is not that bad except when interviewing those George Mason guys who all have extensive media training to sound like Dave Barry while they spout libertarian extremism.
There should be an Asshole Tax. If you are an asshole, you pay a tax.
Only assholes will be against this. And who cares about them? They're assholes!
Dean's good if only to hammer home the true point that our current high levels of inequality were a political choice, not the will of God.
An argument for taxing consumption:
Suppose, counter factually, you have a government that, through fiscal and monetary policy, will even out short term fluctuations in employment and inflation. And assume that environmental issues and externalities are addressed.
Consumption taxes lead to a higher savings rate and this a higher long run growth rate. (I need to review to check that the argument is really about rates and not levels.)
The usual argument for taxing consumption is to encourage investment. However, as I understand it, recent history suggests that the rich prefer to stash it in their mattress rather than do anything useful with it.
There is absolutely no reason to encourage savings and investment, which should be highly taxed.
1) Given enough income, the lower three working class quintiles will "invest"...in homes, trucks, appliances, tools, and eventually the dream of every laborer, their own small shop or business. (and also retirement*)
2) Entrepreneurs will only invest when there is a market for what they produce. Consumption doesn't precede production and investment, but demand definitely does. And taxing consumption is taxing demand. Insane.
* which reminds me, Hillary wants a 3% mandatory tax to provide IRA's for everybody, and a captive market for Wall Street? Are you fucking kidding me? This is the homicide of Social Security just as much as the 70s IRAs (among other factors) were the death knell for defined-benefit plans.
But y'all daisuki the Hil.
It's good to see you're still around and still repeating Republican talking points.
Which of those are Republican talking points?
Nobody who ever said "mandatory tax" together is attacking Clinton from the left. It's almost as big of a tell as "War of Northern Aggression" or something.
Or maybe Democrat party. OK
I feel like if you want to give Bob a hard time you should come up with something better than him failing to pronounce shibboleth correctly though.
44: I feel like I don't need to try very hard when the first part of a comment is asking for taxes on investment and the second part talks about Clinton's tax plan without mentioning her capital gains tax plans or her plan to tax hedge fund earning as regular income.
I'm going to claim victory now because I got you to do better.
Do you have a fence that needs whitewashing?
Do you want to run away with a large black man?
I should probably finish consulting for pharma first.
46: Yeah, you really do. The Democrats are the genius of bait-and-switch. Just as Bill increased taxes on the rich in 1993, and then killed Glass-Steagall, the rich fucks the Democrats work for understand and can calculate the profit from increasing income more than taxing it.
3% more of GDP to Wall Street will cover a fuckton of piddly and completely avoidable tax increases.
Dem fucks are really fucking good at this, Obamacare still has most loyalists fooled.
I think calling them evade-able tax increases would get your point across better than avoidable.
For starters, 3% of wages is less than half of 3% of GDP. For seconds, it's not even close to 3% of wages because it's requiring 1.5% from employer and employees. I'm not sure how many people actually contribute, but something like 3/4th of jobs have that kind of employer contribution on offer. It's certainly not going to solve the issue with pensions and retirements, but it's certainly nothing out of the ordinary.
53: Jesus, you mean it's true?
Not getting sucked in here
Maybe go stick your head in the sand until we come up with an election where the choice is between pure socialism and a Hitler clone.
I do think we should put a pin in this one till the 9th next month. Can I pencil you guys in?
Only came back because of a double-take on neb's Ozu link in 45. I of course have seen all listed multiple times.
Movies missing:"Flavor Of Green Tea Over Rice,"
"Tokyo Twilight," and "Floating Weeds". Possibly about controversy:the first movie has an abortion subplot, the other two deal in part with wife's submission to husband/boyfriend, with physical abuse in Weeds. All could be interpreted as conservative. (End of Summer" has an adultery subplot, but is also just weird. Excellent cinematographic play within a huge old style mansion, open shoji doors allow framing games...never mind.)
Also been dying to link Sweetness and Lightning's Counter-Hegemonic Masculinity by Pause and Select on Youtube.
At the right are more P & S videos. Apparently a theory-laden grad student in cultural or media studies, the Series "Understanding Disaster" in three parts, with the Re:Zero video as a continuation is pretty interesting, trying to find a post-apocalypse politics in anime (Akira, Evangelion). Could you do a dissertation in video?
PS:Head in the sand? Back two months from my first visit to the mountains, it was amazing, I'm mellow for months.
||
Asshole with a drone caused DXB to close for over an hour delaying my flight back to Arrakis for at least that long.
|>
I've been traveling with a guy who looks like Osama bin Laden. It took him a while to get through airport security.
Just carry around a copy of the newspaper from when Osama was killed, dude!
What if Marvel reboots the storyline?
I'd forgotten how much I hate the Southwest boarding process.
62 Things aren't going so well here either.
You know who else hated the Southwest boarding process?
Fucking mess on the other side too.
But y'all daisuki the Hil.
But is the Hil yandere or tsundere? Which OS-tan is she most like?
My sarcasm cannot contain my italics.
Just arrived in New England for a couple days. Its cold here.
Is there snow on the ground, like there is here?
I have the first actuality of a lover, but the second actuality of a hater.
I'll leave that one to the philosophers.
April would be the cruelest if we had one.
Good luck with job interviews if I remember correctly that that's what you're doing, Spike. We can be co-pokiest. Or maybe it's like the Olympics and there are different men's and women's divisions.
75, 76:
This one goes out to all the lovers on the blog.
Thanks, Thorn.
Apparently there was snow a couple days ago but I made sure they got rid of it before I got here.
A coworker is going to a conference in Boston (he's never been in the US before) and wants to take the train to NYC which I assume would mean taking the Acela Express. Should he book it now while here or can he buy a ticket there, even on the same day at the ticketing booth?
Acela isn't all that much faster than standard train (regional express I think is the Amtrak branding?), difference of maybe 40 min and costs half as much for slower. Most of the time gained compared to long ago isn't speed of Acela, which never gets going all that fast, it was was when they electrified the route and saved 30 min no longer needing to change engines at New Haven. As far as reservations depends on day of the week- non weekend or holiday can probably just buy at South Station.
83: Same-day in-person ticketing is possible but substantially more expensive IIRC.
53: Why should I expect that the incidence won't fall on employees in the long run? I guess lots of wages are sticky, such that the short-run effect will actually be to split the burden evenly. But it increases the cost of employing people, and to the extent that wages are market prices (I'm not sure how true this actually is), this should straightforwardly cause lower net wages in the long run.
If you know when you're going, buying Amtrak tickets ahead of time can be substantially cheaper. Also, if your schedule is constrained, Acela may be the only option.
To be clear, my actual opinion on the matter is that the system is broken enough that "increased investment" is mostly a social fiction of some kind, so I don't expect benefits from this sort of scheme via actually increasing real investment and thus real wealth. Basically, I think the system is dishonest enough that the real effect of the 3% program won't particularly resemble what's written on the label.
Increasing the complexity of the system in this way mostly seems like a bad thing; the real solution is to figure out a way to restructure the economy that doesn't require dishonesty, artificial scarcity, or fucking over huge numbers of people. But until we figure that out, we should basically keep the machine running as-is, only patching it to fix acute, tractable problems. Social Security seems like a good such patch and maybe we should decrease its sensitivity to earnings in order to help old people who had lower wages in life. That would be a comparatively honest solution.
Hillary seems like she basically wants to keep the system running, but believes in it too much to leave it alone, and wants to improve it by the standards of official reality. Maybe that's the best we can get right now.
Didn't you read the article? It says that these are popular ideas among economists. Economists are demonstrably morons, and I say with due apologies to those merely lacking in intellect. Anyone who makes a decision involving money based on the advice of an economist is throwing away money. The Wall Street Journal editorial pages tout the wisdom of economists, but every investor knows that those are the pages to short.
90- I think you are overgeneralizing here. Of course the economists Wall Street Journal publishes on it editorial pages spout nothing but bullshit. That doesn't mean all economists are idiots though.
