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, You Can't Have it Both Ways on Dec 11th, 2011
One might reasonably make a case for taxing higher education, particularly if one views the acquisition of bachelor’s degrees to be much like an arms race. Suppose I proposed to increases taxes on colleges and I come out publicly and say, “we are going to institute a 20% tuition tax on college attendence; however, students [...]
Posted in Taxation on Dec 9th, 2011
My readers should spend time reading Tim Taylor’s fine blog regularly. Today he discusses very clearly and coolly the possible reasons why economists disagree on what the “optimal” top tax marginal rate is. In that post he discusses that part of the reason for disagreement is some disagreement about what the “marginal utility of an [...]
Posted in Taxation on Dec 7th, 2011
The neo-conservatives report on income taxes: What changes here isn’t the solvency of the trust fund. What changes is where the money comes from. Payroll taxes mainly come from the middle and working classes. The general fund is supported by income taxes, which mainly come from the well-off and the rich. So, generally speaking, a [...]
Posted in Taxation, Welfare State on Nov 28th, 2011
I suppose I am guilty of it, but tax guru Emmanuel Saez (one of the guys who work the IRS data to illustrate the rising income inequality in the US) just wrote a second paper in a few months with the implied (or direct) conclusion: raise taxes on the rich. Of course, it is all [...]
Posted in Behavior, Paternalism, Taxation, You Can't Have it Both Ways on Nov 27th, 2011
Sort of an ironic title for the plan of Professor Frank, no? I call it the 6-6-6 plan — an across-the-board 6 percent national sales tax (on top of any existing state and local sales taxes) in effect from 6 p.m. on Thanksgiving to 6 a.m. on Black Friday. This plan would leave both stores [...]
Posted in Economic Illiteracy, Taxation on Nov 18th, 2011
Kevin Drum drums up an image that corporate taxes are low in America. Indeed he is right about that. But what he is NOT right about is whether corporate tax rates are high in America. Here he is: But whatever we do, don’t ever fall for the complaint that corporate tax rates in the U.S. [...]
Posted in Taxation, You Can't Have it Both Ways on Oct 12th, 2011
Let me accept the premise that when you raise taxes on people, not only do you not discourage work effort, but that you also encourage it. That is the folk view of many people new to economics. I can see why folks might think this – for them, they might have a “target” income in [...]
Posted in Taxation on Oct 11th, 2011
I used to be a dirty, greedy investment banker. Now I quit for all kinds of reasons, and my expected tax payments were not among them. For argument’s sake, let’s assume that my total compensation today would have been $1,000,000 had I remained doing what I was doing. Today, I am involved in the “ennobling” [...]
Posted in Classical Liberalism, Taxation on Oct 7th, 2011
Continuing on with our short miniseries, let me ask a simple question for your reflection. First, recall the meme: the reason the rich should pay more in taxes is that they were only able to earn their income by hiring people that went to (taxpayer funded) public schools, employ people who drove on (taxpayer funded) [...]
Posted in Classical Liberalism, Market Failures, Taxation, You Can't Have it Both Ways on Oct 6th, 2011
Let’s return to the original claim: the reason the rich should pay more in taxes is that they were only able to earn their income by hiring people that went to (taxpayer funded) public schools, employ people who drove on (taxpayer funded) public roads and otherwise could not do what they do were it not [...]
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