What is the optimal upper marginal tax rate? Should it be much higher than it is now as it was in previous more prosperous and more egalitarian times? Or if you do raise rates in that way will you stop innovation and see all the job creators "going Galt"? Krugman discusses an interesting study by Peter Diamond and Emmanuel Saez here. This study evaluates the effect of high taxes as a disincentive so as to arrive at an optimal rate. The result? 70%. Much like it was back in more prosperous times. Maybe the study is wrong, but it's important for people on the right to remember that just because it sounds plausible that higher taxes do more harm than good that doesn't necessarily make it true. The data and facts matter.
Also a couple of links from Bruce Bartlett. In the first he talks about how Republican solutions to our economic problems are precisely the opposite of what CBO and other data indicate would work. In the second he talks about how the tax hikes of 1990 and 1993 clearly were causal in deficit reduction and they were of course likewise opposed by most Republicans. There are workable solutions to our current fiscal problems. Republicans just won't allow them.
5 comments:
This is easy, all you Liberals start putting your money where your mouths are. Jon there is nothing holding you back from giving the gov't 70% of your wages so do it and stop trying to steal from others.
If this movement it so sound you don't need me or other conservatives - take care of your own. Every Liberal that has a job should voluntarily sign up to give 70% of their wages for the cause - you don't need us. In return we will sign up to take care of all Conservatives that fall on hard times.
In the mean time, I/we will continue to look for every possible way to keep every possible penny away from the progressive movement and gov't programs. Thankfully we have been able to do that very - very well.
I would voluntarily pay more if I thought it would work. But since it wouldn't work I don't suggest it.
There's nothing new about your suggestion. Whenever progress is made, whether giving women the right to vote or giving people freedom of expression, one method of opposition is to propose unworkable alternatives. So when blacks are stuck in separate but equal bathrooms and people like MLK Jr organize non violent protests that do in fact break laws, what he is told is if he really wants to change things he should do it via other methods. He shouldn't gather and assemble. That produces "filth" in the streets. Garbage. These parasites should just let the market work things out. If it's profitable to do away with separate but equal bathrooms then he'll soon have them. But all this protesting and speaking is disruptive and makes people uncomfortable. Don't do it that way.
Yeah, well, they tried that way for about a century with no luck. What you propose is something similar. It wouldn't work. The deficit will stay sky high. The economy will flounder. Unemployment will stay high. We know that more progressive taxation can alleviate the problems. We've seen it work over and over again. Most of the rich actually understand that as well. So rather than proposing methods that won't fix the problem, I'm thinking it makes more sense to propose methods that do in fact fix the problem.
Here's a story for you Chad on actual millionaires and their beliefs about the effects of more progressive taxation. Would tax hikes harm their hiring prospects? The journalists after much digging actually can't find anyone that agrees with this claim. They say their personal income tax rate is about the last thing they consider when looking to make a hire if they consider it at all. They understand that they are rich because of the progressive taxation that went before them, so they support more progressive taxation. Why not look at the real world and consider workable options?
The difference between you and me is you have no evidence that your proposals actually work. It seems plausible in your head that they would work, but there's no evidence. Nobody will step up and suggest that progressive taxation would harm their hiring prospects as you claim. Consider looking at the facts.
I get it now, you believe in the cause to steal other people's money, but will not participate until the gov't forces me to participate as well - classic Liberal all talk and no go.
I've already offered my solution, you called it inhumane or something. If you are a parasite, if you pay no income taxes, if you choose not to work as hard as I have And need assistance then I will help, but my money my rules. Drug and alcohol testing weekly, no cable TV, cigarettes and NO CHILDREN while your on assistance. 20 hours mandatory volunteer work for the city/community per week or you must attend school for 20 hours a week. Curfew is required and progress must be made to be a productive citizen in 3 years or left.
I won't even comment in detail on women and blacks - that is your crazy soap box spin in your fake world analogy that made zero sense to me.
Let's stay focused on the topic, not get sidetracked about whether or not taxation is theft. My point to you here is this. If we want to resolve problems we should consider solutions that work, not solutions that we have no reason to think would work.
You say liberals could voluntarily give more. But that's been true forever. Liberals can give more today if they like. They could give last year. If having the option to give more didn't solve the problem last year, do you expect it will solve the problem this year? This is not a solution to our current problems.
You can say that if me and all the other liberals that wanted higher taxes (like 80% of the population supports higher taxes on the wealthiest Americans) gave then we'd have what we want. But if it's voluntary, not mandatory, it won't happen. Sorry, that's the real world. So the problem isn't fixed. It's like saying things would be so much better if we just lived in peace and loved each other. Yeah, OK. So what? If you don't offer a workable strategy for achieving those conditions then save your breath.
What I offer is a study that looks at the optimal tax rate. Optimal in the sense that empirically we conclude it would likely lead to the kind of revenue generation that would solve our problems. It addresses the whole "going Galt" thing and concludes yeah, let's have a top marginal rate at about 70%.
You're solutions is to just sit in an arm chair and say "I have an idea!! You get assistance if you have no more kids, do 20 hours community service/wk, 20 hours of school (presumably 20 hours of homework)." Spend no time with your kids or spouse if you have them. I'm sure your kids don't need parenting, and it's not like parenting is worthwhile. You don't make money doing that so I guess it means nothing. OK, that's your strategy. So how does this work? You can't pay for everyone. Are you suggesting collection of taxes to provide welfare. THEFT!! And who's going to administer the drug testing? Who's going to pay for that? Tax dollars? More theft. And why think this is going to work? Is this just arm chair stuff? Just shooting from the hip. Give it a go for a few years and if it doesn't work but just ruins more lives, whoops. Or is it worth looking at some empirical studies first?
And again, ask yourself why you obsess about money to the poor. You never talk about the hundreds of billions of dollars in corporate welfare. I used to work in defense. Here's how it worked. "Here's $300 million. Go see if you can develop this technology." Sure, we'd say. We can do it. We'd go home and say that's a fantasy, but we'll take the money and play with it. Come up with something. Stock price is through the roof. Rich people like you own the stock, so you benefit. And you don't complain. Nor did I complain. But the thought of a poor person trying to keep their kids fed. That really outrages you even though I bet it's far less money than the corporate welfare. Why is it that you are so worked up about help to the poor and you stay silent when it's help to rich people like you?
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