We can only hope that in their forthcoming book on tax justice, Saez and Zucman will say the things they didn’t say in their op-ed. We can hope that they’ll help us with two empirical questions. First, what was really happening in the era of high rates? Second, why don’t they think we should worry about how taxes will affect growth? Furthermore, we can hope that they will explain their underlying philosophical position—what do they mean by “justice,” and why do they think we should share their views?
But as important as anything else, they need to acknowledge that they’re really arguing for an enormous increase in the power of the state. Though progressives talk incessantly about the distribution of income and wealth, they seem to be more concerned with the distribution of power. Any plan for income redistribution—certainly any plan of the magnitude imagined by Saez and Zucman—necessarily requires a powerful government. Income redistribution doesn’t simply take purchasing power from people with lots of money and give that power to people with less power. It establishes the government as a grand agent, taking power from some citizens and granting power to others.
These two paragraphs are from the March Econlib Feature Article, published this morning. It’s titled “Tax Justice” and is authored by Michael L. Davis, who is a senior lecturer in business economics at the O’Neil Center for Global Markets and Freedom at Southern Methodist University’s Cox School of Business.
I recommend reading the whole thing.
READER COMMENTS
Benjamin Cole
Mar 5 2019 at 1:40am
As the great former Senate Finance Committee Chairman Russell Long said, “Don’t tax you, don’t tax me, tax that man behind that tree.”
Probably the best taxes would be pollution taxes, property taxes, and national sales tax and tariffs.
However the taxing powers that be seem happy with income taxes and payroll taxes, especially the latter.
Fred_in_PA
Mar 5 2019 at 11:19am
Davis asks, “First, what was really happening in the era of high rates?”
As an amateur, I’ve always been surprised that no one seems to notice that;
(a) the last integrated steel mill in the U.S. was built at Burns Harbor, IN, in the early 1960’s. (Similarly, employment at Sparrows Point, MD, peaked in 1959.)
(b) we had punitively high taxes (70%) until the Reagan era (1980’s).
(c) with new investment severely discouraged, it took 20+ years for the earlier investment (e.g., Burns Harbor or Sparrows Pt.) to wear out. At which point,
(d) the U.S. steel industry collapsed.
I’m aware that “anecdote is not the singular of data.” But still . . . .
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