Sign the Petition to keep the Internet in American hands and protected by the First Amendment. We don’t need dictators governing the Internet! [Read more...]
“That I and most Americans have no idea whether our tax returns are accurate ought to tell us something.” – Donald Rumsfeld
While the 2000s may have been a lost decade for the American dream, a revival of our model’s advantages is still a real, worth-desiring possibility.
Because it was tax day recently, because he mentions me and because I’m easily provoked, below the quote you’ll find three rejoinders to Jonathan Cohn’s admirably forthright argument that American society would be much better off if most of us were writing larger considerably larger checks to Uncle Sam:
Maybe you don’t like tax day … [because] it reminds you of how high taxes are—and you think that, because of those high taxes, the economy grows more slowly. That would mean fewer jobs and less pay for you—and the country as a whole. It’s not a crazy argument … But the evidence for this point of view turns out to be thinner than you’ve probably heard. Relative to other countries, tax rates in the U.S. are relatively low, even when you throw in local and state taxes and add them to federal levies. Overall, according to the Tax Policy Center and Center on Budget and Policy Priorities … taxes in the U.S. are among the lowest in the developed world. The average for countries in the Organization for Economic Cooperation and Development, an organization of rich countries, is higher. And in countries like Sweden, Norway, and the Netherlands countries, the average is much higher. In those nations, taxes account for more than half of total national income.
That level may sound scary but, as many of us have written before, you could make a good case that the people of Scandinavia and Northern Europe know what they are doing. They are far more secure, thanks not only to national health insurance but also to generous provision of child care and unemployment benefits. And despite the high tax burden, their economies have historically been strong—in part, because the combination of investment and a secure safety net makes people more comfortable with a dynamic, ever-changing economy. The wonks used to call this economic model “flexicurity.”
As conservatives like New York Times columnist Ross Douthat note, you can’t simply import that model to the U.S. wholesale. But the Scandinavian experience is one reason that many economists and policy experts think there’s room for U.S. taxes to rise ….
1) It’s true that the U.S. has a lower tax burden than most developed countries. It’s also the case that the U.S. is much, much richer than most developed countries, in ways that a casual trip to Paris or London or Stockholm can sometimes obscure. The I.M.F.’s numbers have our purchasing-power-adjusted per capita G.D.P. at $53,101, which is slightly lower than oil-rich Norway (and Luxembourg) but more than $10,000 higher than Sweden and more than $15,000 higher than Denmark; most of the rich European economies are clumped together between the mid-thirties (where you’ll find the French) and the low forties (where you’ll find the Germans). Now: This wealth gap doesn’t necessarily prove anything about the link between low taxes and growth, since the U.S. has basically always been richer and (as Cohn notes) many of the social democracies have grown at a very respectable rate, in per capita terms, over the last few generations. But if you flashed back to the 1970s, you would find a number of very smart people who expected northern Europe (and Japan) to achieve more than respectable growth, and do more than just keep up with U.S. growth: They expected, for plausible theoretical reasons, that we would see continued convergence between the American economy and its developed-world competitors. And that, to put it mildly, did not happen; instead, post-Reagan, the social democracies actually slipped back a bit. So without claiming anything dispositive, I would be much more cautious than Cohn about the claim that growth and tax rates are unrelated, and much, much more hesitant about treating major tax increases as basically a free lunch.
2) And speaking of that free lunch … it’s also quite possible that the European economic story would look rather different, and rather less impressive, if American political economy had always looked more Swedish or French, and hadn’t pursued growth and innovation at quite the same frantic, Anglo-Saxon pace. This is, again, a highly contentious topic, but there’s a certain plausibility to the idea that (in the language of Daron Acemoglu and James Robinson) the developed world’s different tax-and-transfer models are actually complementary “flavors,” and that in a world where rich economies all converged on a single “cuddly” model of capitalism everyone — poor Scandinavians as well as rich Americans — would, on a long time horizon, eventually end up worse off. (Here it’s also worth pointing that if these complementarities and spillover effects do exist, the sheer size of the U.S. economy means that “Europeanizing” our tax-and-transfer model would represent a much more high-stakes roll of the global-economic dice than the kind of “bringing a lone outlier closer to the norm” scenario that country-by-country comparisons sometimes evoke.)
3) Then on what you might call the question of implementation, Cohn concedes the very general point that we can’t simply impose Swedish structures on the United States and call it a day, but he doesn’t address the more specific problem suggested by that concession: Namely, that a lot of liberal proposals essentially ask us to assume that American government — the quasi-imperial government of a vast, diverse, immigrant-heavy continent of three hundred million people — can somehow, in some future dispensation, approach the efficiency of welfare states administered on a much smaller scale and for a much more homogenous population. Which is to say, they wave away one of the central problem with existing public outlays in the U.S., which in other contexts they’re happy to highlight — the absence, in core areas like health care and education, of a clear link between increased spending and better outcomes. Or else they acknowledge the link, but assert that the best way to reform our kludgeocracy is to pursue greater efficiency in program design while simultaneously pouring more money into the system overall — using a heaping-full of sugar to make the medicine go down, if you will. (This was the basic theory of Obamacare, and also of more bipartisan reforms like No Child Left Behind.) It isn’t a crazy theory, but I think it’s reasonable to worry that in a system as inefficient and cross-pressured as ours, the sugar simply offsets or counteracts the medicine’s effects. And that possibility makes a strong case for holding the tax burden constant while seeking de-kludge-ification, rather than pre-emptively handing more money to bureaucracies and programs that aren’t exactly being managed with Nordic efficiency, and aren’t showing the most impressive of results.
To the foregoing I’d add one further, non-rebutting point: Namely, that regardless of whether one prefers Scandinavian-style social democracy to a lower-tax, more laissez-faire-ish mixed economy on moral grounds, the case for higher taxes gets stronger to the extent that the U.S. model doesn’t seem to be working on its own terms. By this I mean that all systems involve trade-offs, and our model is no different: American-style capitalism promises higher living standards overall in exchange for higher individual risks; faster growth rates in exchange for greater inequality; lower unemployment rates in exchange for fewer workplace protections; more liberty for innovators and entrepreneurs in exchange for somewhat less solidarity-as-redistribution. But if this promise isn’t being fulfilled, as has been the case in the last decade — if only the rich are seeing income gains, if the pace of growth and innovation are slowing even as inequality gets wider, if workforce participation is actually dropping below the European norm — then it’s inevitable that the model itself will start to bleed support. So at least part of the left-right divide at the moment (visible in the Picketty discussion, the guaranteed-income vogue, and the like) is over whether we should accept this breakdown, this failure of the American promise, as a permanent feature of our political economy — in which case the argument for high taxes does look stronger, because there’s less to lose — or whether we should still be making policy on the assumption that while the 2000s may have been a lost decade for the American dream, a revival of our model’s advantages is still a real, worth-desiring possibility.
. . . . . . . . . . . . . . . .
Ross Douthat is an Op-Ed columnist for The New York Times.
by Grover Norquist
With the arrival and passing of yet another April 15th Tax Day, the federal government will consume 20.5 percent of America’s total income this year. It’s not as bad as in France or Greece, but somewhat worse than when we formed these United States. When we were Colonies under the British, the average tax burden on American colonists was 2 percent. That was considered unbearable, and the revolution was on.
There has been some slippage over the years. The 16th Amendment allowing the income tax opened the door to truly European, supersized government. [Read more...]
Lois Lerner, the former IRS official at the center of the agency’s Tea Party controversy, mentioned potentially getting a job at an offshoot of President Obama’s campaign, according to newly released documents.
Lerner, discussing Organizing for Action with colleagues on email in 2013, said “Oh–maybe I can get the DC office job!” [Read more...]
U.S. District Judge Ronald Guzman sentenced television pitchman Kevin Trudeau to 10 years in prison for making false claims in a weight loss book he wrote and was hawking on TV.
In infomercials for “The Weight Loss Cure ‘They’ Don’t Want You to Know About,” Mr. Trudeau claimed food companies and the government had kept secret a “miracle substance” discovered by a British doctor. [Read more...]
A veteran Justice Department lawyer says that Attorney General Eric Holder has politicized the department in a way he hadn’t seen before. In short, “Holder is the worst person to hold the position of attorney general since the disgraced John Mitchell.”
Now in his sixth year as attorney general, Holder has increasingly tilted the department in an ideological direction. It’s one thing to emphasize President Obama’s legal priorities. It’s quite another to decide not to enforce certain federal laws — such as the ban on marijuana — or urge state attorney generals to refuse to defend local laws on same-sex marriage. Legal changes are achieved through legislation, not through a sudden whim not to enforce them. No other attorney general has acted in this manner. [Read more...]
Outrageous, but candid.
“There is a vast amount of discretion that a president has — and more specifically that an attorney general has,” Holder told the House Judiciary Committee. “But that discretion has to be used in an appropriate way so that you’re acting consistent with the aims of the statute but at the same time making sure that you are acting in a way that is consistent with our values, consistent with the Constitution and protecting the American people.” [Read more...]
The results of the latest national elections in Hungary on April 6, 2014, proved that history in this ancient land of the Magyars only moves in one direction, namely, backwards. Nowhere in central and eastern Europe are the legacies of the painful defeats of two world wars, the idiotic governance of Miklos Horthy, the catastrophic alliance with Nazi Germany, and the destructive communist dictatorship so unresolved as in this country. For this reason, Hungary unites the three sicknesses that obstruct the future; confused submersion under the nation’s bloody history, desperation about the perceived individual and collective hopelessness, and an all-consuming hatred that is being released spontaneously as well as systematically, in the form of chauvinism, xenophobia, and sheer materialistic envy. [Read more...]
On December 3, 2007 the US intelligence community released an NIE or National Intelligence Estimate on Iran.
A month later, on January 1, 2008, “All the Shah’s Men: An American Coup and the Roots of Middle East Terror” by Stephen Kinzer was published.
The first claimed the Iranians stopped their nuclear warhead work in 2003.
The second claimed the American CIA planned a “coup” in 1953 in Iran which brought Shah Pahlavi back to power.
The stories are critical to understand the inability of the US and its allies to successfully end the terrorist regime in Tehran and stop its nuclear ambitions. [Read more...]
by CJ Ciaramella
The Internal Revenue Service (IRS) sent tax documents on a targeted conservative group to Democratic staff on the House Oversight Committee, newly released emails show, despite previous denials by ranking Oversight Democrat Elijah Cummings (D., Md.) that such contact had occurred.
Emails released by the GOP-led Oversight Committee show Democratic staff requested information from the IRS’ tax-exempt division on True The Vote, a conservative group that monitors polling places for voter fraud. [Read more...]
Two months ago, a petition bearing more than 110,000 signatures was delivered to The Post, demanding a ban on any article questioning global warming. The petition arrived the day before publication of my column, which consisted of precisely that heresy.
The column ran as usual. But I was gratified by the show of intolerance because it perfectly illustrated my argument that the left is entering a new phase of ideological agitation — no longer trying to win the debate but stopping debate altogether, banishing from public discourse any and all opposition.
The proper word for that attitude is totalitarian. It declares certain controversies over and visits serious consequences — from social ostracism to vocational defenestration — upon those who refuse to be silenced. [Read more...]
Nevada cattle rancher Cliven Bundy has called on Clark County Sheriff Douglas Gillespie to start arresting Bureau of Land Management agents on charges of trespassing and theft as his battle against the federal government intensifies. [Read more...]
House Ways and Means Committee Chairman Dave Camp lays out damning evidence of Lois Lerner’s targeting of conservative groups.
Nearly a year into the IRS scandal, we still don’t know exactly what happened—though we are finally getting an inkling. That’s thanks to the letter House Ways and Means Chairman Dave Camp sent this week to the Justice Department recommending a criminal probe of Lois Lerner. [Read more...]
Agency still under fire for Lois Lerner-tea party targeting scandal.
Even as the IRS faces growing heat over Lois G. Lerner and the tea party targeting scandal, a government watchdog said Wednesday it’s pursuing cases against three other tax agency employees and offices suspected of illegal political activity in support of President Obama and fellow Democrats. [Read more...]
While the White House has argued that the wage gap between men and women in the White House is better than the national average, it is far worst than the average in the District of Columbia.
The pay gap among women in the White House is more than twice as large as the average in the nation’s capital. [Read more...]
Amid much fanfare, President Obama on Tuesday signs two executive orders designed to begin to narrow the wage gap between men and women. Never mind that the criteria generally used to measure such things are faulty and that the Obama administration doesn’t practice what it deceptively preaches. [Read more...]
Once education, marital status and occupations are considered, the ‘gender wage gap’ all but disappears.
April 8 is “Equal Pay Day,” an annual event to raise awareness regarding the so-called gender wage gap. As President Obama said in the State of the Union address, women “still make 77 cents for every dollar a man earns,” a claim echoed by the National Committee on Pay Equity, the American Association of University Women and other progressive groups. [Read more...]
Americans have recently been hit with some of the largest premium increases in years, according to a Morgan Stanley survey of insurance brokers.
The investment bank’s April survey of 148 brokers found that this quarter, the average premium increase for customers renewing an insurance plan is 12 percent in the small group market and 11 percent in the individual market, according to Forbes’ Scott Gottlieb. [Read more...]
Who drafts the Democratic Party’s campaign strategy? Whoever it is, they should be fired. Their 2014 plan violates a basic rule of electoral public relations: Don’t build your entire campaign around a hypocritical allegation that could blow up in your face.
I’m talking about Democrats’ unending war on the billionaires who fund right-of-center causes. Over the past month, the party’s campaign committees, PACs and allied groups have spent millions trying to link Republicans to these ostensibly evil oligarchs who are buying elections and rigging the system against the middle class. [Read more...]
The recent Supreme Court decision over-ruling some Federal Election Commission restrictions on political campaign contributions has provoked angry reactions on the left. That is what often happens whenever the High Court rules that the First Amendment means what it says — free speech for everybody.
When the Supreme Court declared in 2010 that both unions and corporations had a right to buy political ads, that was considered outrageous by the left. President Obama called the decision “devastating” and said it “will open the floodgates for special interests.”
Those unfamiliar with political rhetoric may not know that “special interests” mean people who support your opponents. One’s own organized supporters — such as labor unions supporting President Obama — are never called “special interests.” [Read more...]