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comment by cgod
cgod  ·  4511 days ago  ·  link  ·    ·  parent  ·  post: Six Policies Economists Love (And Politicians Hate)
    Eliminate all income and payroll taxes. All of them. For everyone. Taxes discourage whatever you're taxing, but we like income, so why tax it? Payroll taxes discourage creating jobs. Not such a good idea. Instead, impose a consumption tax, designed to be progressive to protect lower-income households.

I would say among academic economist you would find many people who prefer a progressive income tax to a consumption tax. This is just from my bachelor of economics survey of progressive minded academic economist class lectures, but I wouldn't be surprised if it isn't a somewhat common view.

The rest of the list I think would be supported by most economist. I think you would be surprised how many would say something along the lines of "Well that sounds theoretically sound to me, but I am not really a specialist in XXXXXX economics and you would really want to look at a lot of data before you made a decision about it". All of my best professors took this line with stuff that was outside of their specialty, probably because they didn't like hearing people make sweeping statements about the stuff they were experts in from people who lacked understanding about the trade offs of any given policy.

It seems like very few politicians realize or admit that every position they hold has both a cost and a benefit. The Tea Partiers have a point, but they have no idea of the downsides, same goes with the Occupiers. It's a big part of the disillusionment that comes along with winning policy battles, you get your way, but it ain't all gravy.





b_b  ·  4511 days ago  ·  link  ·  
Yes, this is the basis of the so called "fair tax", one of those brilliant Neocon marketing terms like the "clear skies initiative" and "healthy forests" initiative. By their logic, this would discourage consumption, which would destroy the economy, not to mention that its a de facto regressive tax, not matter what kind of special breaks low income individuals are given. I've never heard an economist outside of the Arthur Laffer gang tout this policy.
JakobVirgil  ·  4511 days ago  ·  link  ·  
I have some stuff I never got around to publishing on a formalization of the Laffer curve. It seems that it is dependant on the rate of growth when one should reduce taxes on the wealthy. in Slow growth periods it is not helpful.
b_b  ·  4511 days ago  ·  link  ·  
As I understand it the Laffer curve is an idealized fantasy in the first place, no? What is his magical t_star? Obviously the curve is much more complex than one symmetric (or even asymmetric) peak. If there is a t_star, it is a weighted average over all incomes anyway, so what's the point of talking about it as if its a thing unto itself. Proclaiming that we should all pay one tax rate so that the world conforms to your idealized version of it more faithfully is a bit egomaniacle, in my opinion.
JakobVirgil  ·  4511 days ago  ·  link  ·  
in mine as well.

but if one takes the folk theory as

There is a point were lowering taxes or for the rich specifically leads to an increase in revenues. One can find regions where that is true. My mathematical model which like all models should not be confused with fact suggests that the point when this Laffer balderdash becomes true is when growth is well above 10%. So maybe the chinese could benefit?

JakobVirgil  ·  4511 days ago  ·  link  ·  
That was the one that I found suspisious. But I will sign off on the rest of it.