Say what you wish about them, I am not here to discuss the morality of them, the economics behind them, etc. What I want to do, yet again, is point out another incoherence among the congregation of the church of the state. My readers have surely been told many times by opponents to stop whining about tax increases because the labor supply elasticities at top marginal income tax rates do not seem to be as large as our intuition suggests it should be. Let’s accept this at face value. Also, we are told that corporations can and should pay higher taxes on their income because they, too, are just not going to change their behavior very much when we raise their taxes.
Fine. Assume all of that. The please tell me this. Why in the same breath are church members so supportive of subsidies for “firms” in favored industries? If, as you claim, that firms do not respond to tax increases, then it would follow that they do not respond to tax decreases/subsidies. Are you outright claiming that you support the shoveling of money from taxpayers into favored firms as nothing other than a payoff for loyal political support? Furthermore, you guys are the ones who regularly claim that the current tax code is not progressive enough. If this is true, then how can you ever support any subsidies of any firms – particularly if firms are among the “people” who are rich, greedy, exploiters that you dislike? So not only are you admitting to a fraudulent give-away, but you are playing Robin Hood in Reverse. We’ll show you a very vivid example of this tomorrow. Stay tuned.
Michael Boskin has a great article on this subject in today’s WSJ.
Doubling taxation on investment may punish the rich, but it will also punish everyone who has a beneficial interest in a retirement plan.
The only way out of our present crisis is economic growth, and Obama is doing everything in the opposite direction.
Great points in this post. You’ve revealed blatant hypocrisy by the left that hadn’t occurred to me. (I genuinely wonder how Ralph Nader feels about “green” loan guarantees for corporations, tax credits for windmills, etc.)