Miscellaneous And Off Topic Subjects

[hack]

Well if you start with the truth -- that growth rates in the modern economy, roughly defined as the post-war period of clear Pax Americana, were highest when marginal tax rates were as well, your next step would be to add nuance to that truth. You could wonder if that would work now. And there's a very good reason to expect it would not, for various reasons but possibly primarily because the mobility of capital and the options offshore were a fraction of what they are now. Which is why I just mentioned what I just mentioned. Maybe AOC's already there. Maybe she knows that a simple call to soak the rich is good enough to galvanize the masses and to freak out Howard Schultz, and that below the surface she's already thought about offshoring and legal tax planning and transfer pricing to allow for profits to be shifted to a company subsidiary in a tax haven in which there are no actual sales, fabrication, R&D or workers. Dunno. But the people on the left in civil society, international organizations who have followed the money have all gone in those directions.

I hope we're gonna get smart policy too, but one thing for sure is that we're gonna get policy. It's always been hidden in tax policy, it turns out, and people like Schultz are now doing what they are doing because people like AOC finally get that.

[Jeff Buchanan]

Re taxation: let me make sure I have this right among posters commenting on this subject.

Hack: Higher marginal tax rates produce economic growth?

talent: No they don't.

WTF ....... I've tried to keep up with you two but it's hard. I don't think there is a baseline from which to start a rational discussion. e.g., are we talking personal income tax or corporate income tax or balling them all together and making a blanket statement about taxation as it affects economic growth? How are we measuring economic growth? Is it by GDP or some other measure?

I welcome a response from you two or anyone else who wants to jump in on this. It's going to e a really important discussion and one that is not easy to understand.

[iam416]

I don't think Palin-Cortez has an ounce of nuance in her nor do I think her calls are anything more than dimestore socialism.

We may get policy, but they won't be the policies of Palin-Cortez and her Progressive Socialists, at least at a Federal level. At least not while the Senate still exists. As politics goes, I'm not particularly convinced that we will get policy. Fingers crossed.

[Jeff Buchanan]

Well if you start with the truth -- that growth rates in the modern economy, roughly defined as the post-war period of clear Pax Americana, were highest when marginal tax rates were as well.......

I don't think your statement, which forms the basis of where you want to go with your argument, forms a universally accepted premise. In fact, I know it doesn't. Depends on who you're reading.

There can't be a rational discussion about this until we have a baseline set of jumping off points. You might want to consider this although I can find plenty of articles that take different positions.

F


https://www.forbes.com/sites/investo.../#7b811cca7c3e

[iam416]

Hack: Higher marginal tax rates produce economic growth?

Correlate, not produce. He's careful.

This would be a more accurate and fair position:

that growth rates in the modern economy, roughly defined as the post-war period of clear Pax Americana, were highest when marginal tax rates were as well, your next step would be to add nuance to that truth. You could wonder if that would work now. And there's a very good reason to expect it would not, for various reasons but possibly primarily because the mobility of capital and the options offshore were a fraction of what they are now.

The nuance to add to the truth of that coincidence is ample and, in a lot of cases, obvious. The truth is likely that tax policy probably doesn't much matter to growth unless it's on the margins. And revenue probably isn't greatly affected either, unless it's on the margins. The margins are different for each -- but my guess is they've shrunk considerably as folks and money became more mobile. So, from almost inelastic to maybe somewhat elastic.

But the tax story isn't the story. It's driven by the larger story -- the spending and "positive' programs. There are some on the Progressive Socialist side who probably view tax policy as partly punitive, but by and large the purpose is to fund the utopia. And that's really where the questions and politics are. Soak the rich is easy politics. It doesn't come close to funding the Palin-Cortex agenda. That will require real tax raises on real people across the board. Can't just slogan your way to that.

[iam416]

I was typing when you added your Forbes edit, Buchanan. Yeah, what that dude or dude-ess said.

[hack]

I agree that tax policy doesn't have that much impact on growth, but I do think it does have an impact on tax revenue, if that's the revenue you meant. If the reforms of the past several years work, taxes will be due to a much larger extent in the places where there are workers, fctories, sales or labs, and much less where there are subsidiaries in low-tax jurisdictions. Part of the reason has nothing to do with ideology or policy. Digital records, properly managed, mean the tax inspector has so much more information at his disposal and no longer has to take the company at word in many instances. This is on reason I think you may want to emphasize taxing the revenue before it gets disbursed to the billionaire's offshore account rather than after.

You may be right about that policy coming from those other than AOC. I don't know. Howard Schultz could be a gift that keeps on giving. He prefers ``people of means" to ``billionaire". I hope he's booked on every talk show every week from now to 2020.

Just so I'm clear, is Palin-Cortex a typo or an evolution of the term? Were I in your shoes I could see some potential in it.

[Jeff Buchanan]

He offers as an example of how the Russians and Chinese, by virtue of the centralized control implicit in their modes of governing, can allocate resources to "hypersonic ICBMs" or landing on the "dark side of the moon" while the US and EU (the "West") (is) are absorbed in, if not distracted by/preoccupied with issues such as the "viability of the WTO and sanctity of the EU ....... et. al.

I think he makes a reasonable point.

You think it is reasonable to assert that the US government is an entity that can only think about one thing at a time?

Give me a break. Of course not.

Since the end of WWII or, if you want to start later than that, since the Reagan presidency for example, would you say that American political and military influence world wide has not diminished..... or, to take this in another direction, would you say that the capacity of the US to obtain best outcomes where her political and security interests are involved, have not declined?

Why is this? The author speaks to that. If you don't agree with the point he's making, say so and then back it up.

Let me clear about this. The Chinese and the Russians to a lesser extent, have done a far better job elevating their capacity to achieve best outcomes where their respective political and security interests are involved than the US has. IMO, that is partly, maybe mostly, because our government and the policy makers inside of it, especially the deciders who act on the inputs from the various departments and agencies, are mired in distracting, and superficial internal political conflicts.

Sure, some are looking outward beyond these internal conflicts, but, it's not good enough when the threats to the US, on all sorts of levels, from China, Russia, other sovereign states as well as non-state actors is increasing in comparison to US capabilities to blunt them when it is our political and security interests to do so. That you scoff at this notion, given what appears to me to be coming from a very smart person, is disturbing to me.

[iam416]

Just so I'm clear, is Palin-Cortex a typo

Typo.

As a matter of politics I would have some concerns about Schultz if I were a Progressive Socialist or anyone hellbent on seeing PDJT lose in 2020. The election won't be won or lost in states where Schultz plays like shit. Right now any D is going to beat PDJT 1v1. But if the Ds go all-in on a Progressive Socialist platform and candidate AND Schultz runs, he'll peel off votes from the Ds. I mean, really, he's only to peel off votes from one party. So, I'm not sure how he's a good thing for the Ds.

[Jeff Buchanan]

Goddamn it Hack, are we talking about tax policy as it relates to revenue generation, economic growth, both or what?

[hack]

It could be that Russia and China have elevated their level of ability to get desired outcomes, but I wouldn't take that as a given. Putin has yet to re-annex anything save for the Crimea, and it got him a punishment he really hates and is trying to shake off without success as of yet. And the only former republic he's got acting as a vassal like he wants it to is Belarus, and nobody gives a fuck about Belarus. China doesn't have Taiwan back. So you can't say that they have a model more conducive to core outcomes when they aren't achieving them.

I have thoughts on that wider issue, sure. Powell Doctrine applies to this conversation and what if it had been applied in the past 20 years, for example. If you want to get to that bigger conversation that might be reasonable, but I just found that column to be a very poor entry point. If it was in the service of those bigger concepts it used very poor and easily debunked points in service of it, and it pretended that the other side is getting all its desired outcomes when that's just not true.

[iam416]

Speaking of god-awful taxes, PDJT seems set to impose a shit-ton of new tariff increases: https://www.nationalreview.com/corne...ate-increases/

I have no idea how credible the source of the costs of reciprocal tariffs as measured by increased consumer prices -- but it says $60B annually.

Though not at play, this also hints at difficulties with taxing corporations. They aren't going to bear the costs by themselves with a stiff upper lip.

[hack]

Typo.

As a matter of politics I would have some concerns about Schultz if I were a Progressive Socialist or anyone hellbent on seeing PDJT lose in 2020. The election won't be won or lost in states where Schultz plays like shit. Right now any D is going to beat PDJT 1v1. But if the Ds go all-in on a Progressive Socialist platform and candidate AND Schultz runs, he'll peel off votes from the Ds. I mean, really, he's only to peel off votes from one party. So, I'm not sure how he's a good thing for the Ds.

You're probably right. I'm nobody's Rasputin, but were I in that role I'd be amplifying Schultz as much as possible to stoke soak-the-rich anger. "People Without Means" could be 2020's Deplorables. But I bet that we get a Harris or a Booker in the end that won't upset the apple cart, and instead of sane economic policy we get SJW recalibrations. That's what Trudeau does in Canada. Not attacking the economic foundations of it, but doing the feelgood inclusivity stuff instead.

Ultimately all roads lead to tax policy through. That's where we will be eventually. JMO.

[hack]

Though not at play, this also hints at difficulties with taxing corporations. They aren't going to bear the costs by themselves with a stiff upper lip.

IMO the answer is different if the playing field is level or if it's not. If I'm CEO, as long as they apply equally to all my competitors as they do to me, I have a good answer for my shareholders, which is that we'll pass along the costs to consumers as much as possible just like everyone else is doing. And I am glad that debates about this or anything else non-tax are going to crowd out debates about me and my effective tax rate.

[hack]

Goddamn it Hack, are we talking about tax policy as it relates to revenue generation, economic growth, both or what?

Talent and I have just agreed that tax policy isn't really going to be the principal driver or destroyer of economic growth. He can correct me if I'm wrong. I think that he also said that tax policy can't do much to drive tax revenue, but I disagreed. I think that tax policy can/will impact tax revenue.