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Tag Archives: Taxation

Three Economists Walk Into a Discussion, Part 1

On September 15, the Stanford Institute for Economic Policy had a virtual discussion about both Covid-19 and the views of the two major presidential candidates. The moderator was Gopi Shah Goda, deputy director of, and senior fellow at, SIEPR and the two interviewees were Kevin Hassett, who had been chairman of the Council of Economic Advisers under President Trump and Austan Goolsbee, who had had the same job under President Obama. I watched it live. I’ll hit some...

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Evidence that We’re Better Off Than in the 1960s, #2976

Those of you who read Don Boudreaux over at CafeHayek know that he often gives evidence that the average American is way better off than his/her counterpart in the 1960s, 1970s, and 1980s. This is my story comparing now to the 1960s. I was talking to a California friend recently and we were both belly-aching about state and local governments’ assaults on Californians’ freedom. The biggest ones right now are the lockdowns. (Parenthetical note: Governor Newsom’s new...

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The Fascinating Federalism of Capital Gains Taxes

Or, Why California Governor Gavin Newsom Should Hope that the Federal Capital Gains Tax Rate is Not Increased One thing that economists are fairly sure of is that a cut in the tax rate on capital gains increases the amount of gains subject to the tax and that, conversely, an increase in the tax rate on capital gains decreases the amount of gains subject to the tax. This is especially true in the short run. This is so because capital gains taxes are levied in the...

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‘Profit’ is a meaningless term

Most people believe they understand what the term ‘profit’ means. It’s a measure of revenue minus costs. Actually, however, profit is a pretty meaningless term, because there is no clear definition of “cost”. I was reminded of this when reading a debate in the Financial Times that discussed whether interest payments should continue to be tax deductible for businesses. The person opposed to ending the tax deductibility of interest made the following claim: No — Tax...

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The Biden tax plan

With Joe Biden now favored in the election betting markets (albeit far from a sure thing), it’s time to take a look at his tax plan. Here are some of his proposals to change the personal income tax: Imposes a 12.4 percent Old-Age, Survivors, and Disability Insurance (Social Security) payroll tax on income earned above $400,000, evenly split between employers and employees. This would create a “donut hole” in the current Social Security payroll tax, where wages between...

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What does it mean to say a debt is “unsustainable”?

I often warn against countries running up excessively large public debts. Some people interpret my worry as a prediction of a future financial crisis, perhaps including default and/or very high inflation. They point out that countries such as Japan have run large deficits for many decades, with interest rates on long-term bonds remaining near zero. So are these worries overblown? For developed countries with their own currency my actual fear is not outright default,...

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Despite Trump’s Best Efforts?

“Despite Trump’s Best Efforts, Economic Freedom Declined in the U.S. Last Year.” So reads the headline of an article on pjmedia.com on March 17 by Tyler O’Neil. Despite? As regular readers of my posts know, I NEVER blame a writer for a headline if I don’t know that the writer supplied the headline. In this case, though, it doesn’t matter because here’s how Tyler O’Neil starts his article: Despite President Donald Trump’s best efforts, economic freedom in the U.S....

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Winners, Losers, and Interesting Aspects of the Dem Debate

The biggest winner Donald Trump. Reason: His numbers rose. The biggest losers (1) Mike Bloomberg. Reason: His numbers fell. (2) Telemundo senior correspondent Vanessa Hauc.  Reason: Hauc wouldn’t let go of a relatively trivial issue like a dog with a bone. Amy Klobuchar admitted she didn’t know the name of the president of Mexico but argued that she knew a lot about Mexico. But Hauc went back to it as if Klobuchar hadn’t said a thing. To her credit, Elizabeth Warren...

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Cass’s Cause

Oren Cass believes conservatives have blundered by outsourcing GOP economic policymaking to libertarian “fundamentalists” who see the free market as an end unto itself, rather than as a means for improving quality of life to strengthen families and communities. The former domestic policy director on Mitt Romney’s 2012 presidential campaign quit his job as a senior fellow at the Manhattan Institute to launch a new group called American Compass that aims to reorient...

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Immigration Lawyer Nathan Brown Interview on Immigration Remittances

Last June I wrote an article for Hoover’s Defining Ideas titled “Immigrant Remittances Are Private Foreign Aid,” Defining Ideas, June 25, 2109. That led to Fresno-area immigration lawyer Nathan Brown contacting me for an interview. It just came out this week and is titled “David R. Henderson on Remittances.” I love the line underneath: “Immigrants Sending ‘Our’ Money Overseas?” because of course it isn’t ours except to the extent that we are the senders. It was nice...

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