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Elections Have Tax Consequences [pdf] (realclear.com)
7 points by RickJWagner 14 days ago | hide | past | favorite | 3 comments



Solid analysis of the political situation as it relates to taxes although the end is a bit of a joke:

"We think tax hikes will slow the economy, and if we had our way, the US would fix its budget problems by cutting spending and issuing 50 to 100-year bonds, but as they say “elections have consequences.”"

https://www.cbsnews.com/news/tax-cuts-rich-50-years-no-trick... ("50 years of tax cuts for the rich failed to trickle down, economics study says)

"Based on our research, we would argue that the economic rationale for keeping taxes on the rich low is weak," Julian Limberg, a co-author of the study and a lecturer in public policy at King's College London, said in an email to CBS MoneyWatch. "In fact, if we look back into history, the period with the highest taxes on the rich — the postwar period — was also a period with high economic growth and low unemployment."


I think the fundamental idea of fair taxation has three folds: 1. Effectiveness - this is where you're trying to maximize revenue 2. Morality - how much money should you be able to forcibly take from someone; 20% (1 day of work per week), 40% (2 days)... less? 3. Purpose - government traditionally served a purpose of providing defense and law and order, over time its spending converted to mainly being a welfare/social program/medical system. And now it's being argued that billionaires shouldn't exist and we need to take their money because of equality of outcome justifications.

So arguments like trickle down failed, are asked failed at what? Do we think that the post war period was successful because of taxes? Even if taxes were high, I'd argue the same outcome would have happened - low skill labor faced increased competition from the market opening up around the world, which reduced the amount of people in poverty by a staggering amount and increased the standard of living with respect to manufactured goods for everyone (due to reduced labor costs everything got cheaper).

If the taxes were higher would we have the tech industry like we do today? Would it be somewhere else? This type of analysis already has the conclusion in mind when the analysis starts.


I think it depends on which taxes we're talking about. Capital gains taxes should increase back to the levels they were at during the Reagan administration, that is, capital gains as normal income.

Right now tax structures in the U.S. incentivize all of the bad patterns of the extreme side of the stock market (leveraged gambling, essentially) instead of manufacturing and employment. The incentive for corporations, then, is to outsource everything and play the margins.

The people who have the most to gain from such a structure are the people who already have money to throw around. Most people can't play in that playground.




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