dagblog - Comments for "The Phony Equivalence of Shared Sacrifice"

As far as a discussion of who

Michael Wolraich — Wed, 28 Nov 2012 22:15:34 +0000

As far as a discussion of who benefits, I don't see how the state/federal distinction is relevant.

Because we're talking about "shared sacrifice" to reduce the federal deficit.

Also, I'm not sure how you mean "indirect."

Every additional inference increases the uncertainty. To argue that the rich benefit disproportionately from the economic benefits of progressive taxation, you need to establish:

1) Taxing the rich to pay for federal services increases the prosperity of the middle and/or lower classes.

2) Increasing the prosperity of the middle and/or lower classes at the expense of the upper class, ultimately increases the prosperity of the upper class (disproportionately to the lower classes).

I suspect that these premises are true, but I don't know enough to prove the point, and I expect that they're pretty difficult to establish conclusively in any specific way.

But regardless of whether these premises are actually true, they are certainly controversial. If your intent is to convince people that the progressive tax is fair because it disproportionately benefits the rich, you have a lot of persuading to do. That's why I call it a weak argument (even if it's correct).

Moreover, it's unnecessary. If you can persuade people of 2), then who cares about fairness? Any rich person who accepts the premises would more than happy to support progressive taxation b/c it would make him even richer.

Regardless, the most prudent principle is to tax the ever-loving shit out of economic rents.

I've been intrigued by this proposal ever since you first offered it. Are there are real-world examples of economic rents on the scale that you're proposing?

At least Jefferson knew

Aaron Carine — Wed, 28 Nov 2012 07:20:32 +0000

In reply to Jefferson's hypocrisy with

At least Jefferson knew slavery was immoral.

Jefferson's hypocrisy with

NCD — Wed, 28 Nov 2012 04:34:06 +0000

In reply to Sheesh. If there are any

Jefferson's hypocrisy with his 'all men are created equal' and his later writing of letters to George Washington among others, on the 4% return he was getting rearing slave babies, while also allowing the whipping 10 year olds relegated to the grueling task of making thousands of nails, all to fund his expensive lifestyle, reminds me of contemporary hypocritical politicians like Newt talking about the sanctity of marriage.

Apparently some of the new revelations on Jefferson were due to the recent book, 'Master of the Mountain'. The author found, among other things, that sections of Jefferson writings and journals had been deleted from major compendiums, to avoid damage to his image.

I also think he jumped to the 'suicide' conclusion in the death of Meriwether Lewis, with little or no evidence but his own subjective speculation, unjustly clouding the man's reputation. See Wiki for details.

For your interest, the

DF — Tue, 27 Nov 2012 21:13:26 +0000

In reply to TR didn't come up with

For your interest, the Revenue Act of 1862. It established progressive federal tax rates on income, the Commissioner of Internal Revenue and federal withholdings on income. Also, if you want to find a prior President who advocated progressive taxation, or "graduated" taxation as it seems to have been referred to at the time, Thomas Jefferson will fit the bill. Adam Smith also discusses it in WoN, but it's less clear to me that he's advocating it above other options that are also discussed therein.

As far as a discussion of who benefits, I don't see how the state/federal distinction is relevant. It's entirely artificial. The tax scolds I know see no distinction in terms of the recipient of the funds - whether it's federal, state or local. The Supremacy Clause and Commerce clause effectively render the states to franchise status anyhow. Also, I'm not sure how you mean "indirect." There are costs and benefits. Some are more or less visible by way of being easily accounted for, but those factors that are difficult to account for are not proportionally less important. Look at how crucial the presence of institutions is in the modern literature on economic development. Those that own - whether it be real property, rights to resources or access to government contracts - always benefit first and foremost above those who do not.

Regardless, the most prudent principle is to tax the ever-loving shit out of economic rents. Doing so has none of the effects that supply-siders complain about, like depressing production, distorting markets or crowding out investments. The only argument against it is the wealthy would rather keep that money. It's astonishing how potent that argument apparently is.

Understand, thanks for

PeraclesPlease — Tue, 27 Nov 2012 19:31:27 +0000

In reply to I'm not sure from your

Understand, thanks for clarification.

Likewise, I struggle what to

AmericanDreamer — Tue, 27 Nov 2012 17:55:55 +0000

In reply to This is exactly what the

Likewise, I struggle what to make of the apparently widespread belief in our country that very wealthy individuals who employ people are somehow performing an act of altruism for their employees, for which they should presumably be given a parade and one day placed in the Job-Creator Hall of Fame.

Implicit in such a view is that most employees should be grateful for whatever compensation the employer chooses to give them, as an act of generosity.

Whereas I had thought that the fact that business owners and managers hire people to work for them is actually an acknowledgement that they are unable, by themselves, to develop, produce, and market the product or service they wish to sell. Making them, therefore, actually interdependent--dependent upon the services of their employees to enable their operation to function, as the employees are dependent upon the managers and owners to finance, organize, and oversee the operations of the enterprise on a day-to-day basis.

Sheesh. If there are any

EmmaZahn — Tue, 27 Nov 2012 12:45:23 +0000

In reply to Thomas Jefferson was big on

Sheesh. If there are any publications that should emphasis the better side of ourselves, you would think The Smithsonian would be among them. Instead they are now featuring dreck like this from someone fixated on the sin of slavery of our founding fathers. But not just them either. Apparently, Tesla was a [gasp] eugenicist [/gasp] -- just like many other leading scientists before Hitler demonstrated how nasty that might turn out to be.

If I recall correctly, Jefferson inherited most of his slaves and the debt incurred in acquiring them from his father-in-law (women then had no property rights), something from which he never really managed to free himself. And he had a prickly, self-absorbed personality, owned slaves and was not always nice to them. These are things that anyone can learn about from a decent biography.. He did not elevate himself to demi-god; his admirers did. Why do you think any of this negates his better ideas and deeds? Why should it?

If there is a lesson to be learned from the hypocrisy of slave owners promoting liberty, fraternity and equality, it is that finances can compromise even the noblest among us.

I was going by memory from

LULU — Tue, 27 Nov 2012 11:34:49 +0000

In reply to Thomas Jefferson was big on

I was going by memory from listening to Clay Jenkins', "The Jefferson Hour". I don't have a direct link to the particular episode where it was discussed.

"Another means of silently lessening the inequality of property is to exempt all from taxation below a certain point, and to tax the higher portions of property in geometrical progression as they rise." (Thomas Jefferson to James Madison, 1785)

Ouch, liberal demi-God takes

PeraclesPlease — Tue, 27 Nov 2012 06:15:20 +0000

In reply to Thomas Jefferson was big on

Ouch, liberal demi-God takes a bruising.

Thomas Jefferson was big on

NCD — Tue, 27 Nov 2012 04:09:52 +0000

In reply to Jefferson was big on the idea

Thomas Jefferson was big on the idea of no internal taxes:

Jefferson recommend no internal taxes on the citizens of the United States:

there is reasonable ground of confidence that we may now safely dispense with all the internal taxes.

and Wiki:

Jefferson believed that the federal government was able to operate exclusively on customs revenue and need no direct taxation. While initially successful, this policy would later prove disastrous when trade to the United States was interrupted by the Napoleonic Wars between Great Britain and France.

To rant on about Jefferson.....

Theodore Roosevelt deplored the Jeffersonian ideal of a weak Presidency and federal government, and thought Jeffersonian doctrines led to the Civil War. Jefferson was elected on the strength of the 3/5ths compromise of 1787 where the count of slaves increased the power of slave states like Virginia.

The Louisiana Purchase fell into Jefferson's lap thanks to the malaria/yellow fever decimation of a 50,000 man army Napolean had sent to subdue a rebellion in Haiti, and Napolean's need for money to fight in Europe. Jefferson also had the idea that (Wiki) "citizen soldiers would arise to defend the country in case of attack" which didn't work out too well when a small British force marched into and burned the city of Washington DC in the War of 1812.

Smithsonian recently has a piece on Jefferson called 'The Dark Side of Thomas Jefferson' which said that research of original documents has shown that Jefferson hired men who whipped 10-11 year old child slaves who were employed making nails for sale, to fund the Monticello plantation which was run with 'carefully calculated brutality'. Jefferson sold slaves off as punishment, used them as collateral for loans, and when asked to accept a huge bequest in a will from a rich Polish nobleman and friend intended to buy the freedom for the slaves of Monticello Jefferson refused, he didn't want to give them their freedom, and he made careful calculations of slave fertility and the profits inherent from it. He never did free his slaves, even after his death, as George Washington did.

The Smithsonian article concludes:

...After Jefferson’s death in 1826, the families of Jefferson’s most devoted servants were split apart. Onto the auction block went Caroline Hughes, the 9-year-old daughter of Jefferson’s gardener Wormley Hughes. One family was divided up among eight different buyers, another family among seven buyers....