The curious task of economics is to demonstrate to men how little they really know about what they imagine they can design. – F.A. Hayek
Posted in Taxation on Jul 20th, 2010
From tomorrow’s WSJ:
Joint Tax now says that rescinding the Bush investment tax cuts will raise about $500 billion in revenue over the next five years. So on January 1 we will enact one of the largest tax increases in history, coming out of one of the deepest recessions in a century, because computer models that [...]
Posted in Taxation on Jun 29th, 2010
Followers of Henry George (a fine economist) argue that land should be heavily taxed and activities that are truly productive (like labor) should be lightly taxed. The argument is used because it is thought that such a system would improve output and also produce a more just “distribution” of wealth.
The reason to tax land, it [...]
Posted in Taxation on Jun 8th, 2010
It is by now I believe conventional wisdom that the federal income tax is complete absurd in its myriad carve-outs, deductions, credits, penalties, etc. Without altering any other portion of the tax code (which needs altering) what would a back of the envelope calculation be for moving from the Progressive tax to a flat-rate tax, [...]
Posted in Taxation on May 7th, 2010
I can’t tell you how many of my students think that taxes do not promote disincentives to act. They think, for example, that when you tax wages, the only possible response is to work more. When you tax savings, the only possible response is to save more, and so on. Their thinking is that you [...]
In their book Nudge, Cass Sunstein and Richard Thaler correctly point out that it is irrational for people to overwithhold taxes from their paychecks each pay period. One reason we do this is to ensure that we get a nice big tax refund when we file our taxes the following year.
Now this is silly since [...]
Posted in Taxation on Apr 6th, 2010
Chris M. sends me this link:
Think Progress » ExxonMobil paid no federal income tax in 2009.
“Last week, Forbes magazine published what the top U.S. corporations paid in taxes last year. “Most egregious,” Forbes notes, is General Electric, which “generated $10.3 billion in pretax income, but ended up owing nothing to Uncle [...]
Posted in Employment, Taxation on Apr 6th, 2010
The chart below shows what has happened to employment in New York state and Texas for the past 10 years. (this is a post which replicates an analysis Mark Perry did comparing California to Texas)
New York’s total employment level has fallen to 8.71 million – the first time it has been there since spring 2004, [...]
From the time of the Republic’s founding right up until World War I, the tariff (a tax on foreign goods and services sold in the United States) was the major funding source for the federal government. In fact, from 1790 through 1913 the median amount of federal expenditures financed via tariffs was 76%. In some [...]
Posted in Government Thuggery, Personal Finance, Politics, Taxation, Welfare State, ethical foundations on Mar 9th, 2010
Per capita GDP in the United States is roughly $47,000.
Per capita personal income is about $39,880.
Let’s think about the kind of tax system we have in the U.S.
What kind of effective marginal tax rates do you think a family faces that has per capita income below half of per capita GDP in the country or [...]
Posted in Taxation on Feb 24th, 2010
Eliot Spitzer today in Slate “proves” that higher marginal tax rates on the rich do not discourage growth. Of course, he proves nothing of the sort, but I don’t want to try to teach economics to the guy, or any of the lefty faithful. I want to ask the statists if they would sign up [...]
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