The No-Brainer Economic Platform

Discussion in 'Economics' started by alib, Jul 18, 2012.

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  1. On Planet Money a podcast, The No-Brainer Economic Platform
    It's 20 minutes of politically suicidal heresy.

    One principle here is taxes serve two purposes:
    A. To raise revenues for public works
    B. To create a structure of penalties for bad unproductive behavior and incentives for good productive behavior

    They all agreed on simplify the tax code, close loopholes:
    1. The biggest, the mortgage tax deduction
    Causes house price inflation. Is a regressive incentive to the rich folks to buy pointlessly lavish homes.
    2. Remove deduction for employer provided healthcare
    It balloons US healthcare costs.
    3. Scrap income and salary taxes, instead tax consumption
    The former are good things for the economy the latter often bad.
    4. Scrap corporate tax
    If you want to tax rich people tax them directly not useful economic activity.
    5. Tax pollution, carbon use, raise gas prices drastically
    6. Liberalize drug laws
    The war on drugs is a huge waste of resources and many drugs are less of a social evil than alcohol.
  2. Even simpler....a statutory limit on the amount of GDP the state can appropriate...say 25%....that would concentrate a few minds, and then let things evolve naturally within that framework. It would stop the Browns of this world putting my grandkids in debt.
    • Like Like x 2
  3. At this rate, my toddlers grandkids will be in debt.
  4. That has very little to do with the structure of the tax code you plonker.

    You'd be living in cloud cuckoo land even at 50%, states have to fight wars, avoid depressions, deal with all types of disasters, capping revenues is the worst sort of fiscal folly. At some point these things need to paid for. Revenues can fall in busts but in booms the state needs de-leverage aggressively, which means taxes, we've yet to devise any version of capitalism where massive market failure wasn't almost certain to occur.

    Government thus constrained will not suddenly become more competent, probably the reverse is true they'll simply defer everything as the US has been doing with public works, take a look at constitutionally hamstrung and not incidentally busted California.

    And we are mostly rather feckless folk that like to live in debt, shirking both productive work, taxes oh and increasingly in the UK any blame for the country being in the state it's in. Who after all has been voting for a whole series of governments that indulged in different forms of get rich quick bodges because it wins votes? Mind Ireland is worse but at least we have the decency to feel collectively guilty about it.