Thursday, April 12, 2012


So, Frank begins by criticizing "trickle down economics" (a popular term in the 1980's when Ronald Reagan was President), basically the term for supply-side economics. He challenges the claims made by the supply-siders by citing evidence that Japanese work more than their American counterparts and that even though real wages have gone up, people are working less. He also challenges the Republican notion that lowering taxes on businesses will lead to more hiring. His main point is that, "We have no persuasive reasons to believe that higher taxes on top earners would inhibit economic growth." Moreover, lower tax rates on top earners can actually stunt growth.

While I understand his logic that raising taxes on top earners will dissuade people from purusing winner-take-all types of jobs (i.e., portfolio managers), why should government redirect people? I don't see an ethical justification for this. And as far as his blame for the recession of 2008, he needs to look at government and Fed other words, Frank needs to study the Austrian school.

I was glad to agree with him on page 167, "...I believe that imposing higher income taxes on top earners would be a bad idea." But his insistence that taxes are not theft is not correct. Taxation is government taking from me and giving to others. However, I agree (maybe at the price of angering some of my Libertarian friends) that some taxation is necessary and legitimate for national defense and providing a court system.

Also, economist and my acquaintance David Henderson has a piece in Cato worth reading:

1 comment:

  1. I am pretty sure you use governemnt functions everyday , that you went to public school at some point , that you drive on roads and your nations army keeps you safe on a day to day basis. Also if your house burns down , or a natural disaster strikes, or if your being robbed there are numbers you can call for assistance from the government.

    This means you receive benefits for your taxes , you are just arguing if you receive coresponding benefits to the amount of taxes you pay, and if not then your money must be going to other people. This you call theft.

    a : the act of stealing; specifically : the felonious taking and removing of personal property with intent to deprive the rightful owner of it

    I am pretty sure you go to a tax preparation agency , or even an online filing service. You voluntarily go and do this with no one physically forcing you to. The regulations and policies in place or only legislation, you have the full ability not to pay your taxes. But just as not paying your debts to people there are consequences, and if the nation allowed people to use its benefits without paying for it in some fashion they would have a horrible tragedy of the commons.

    If you are to say well the government comes after you with guns and makes you pay that is baloney. In some cases of extreme tax evasion one may be arrested but most the time all you get is a fine and a IRS audit that only damages your time. Plus your an able bodied grown adult who is viably intelligent, you could easily dodge taxes if you wanted to.

    The thing is you don't , you cant call it theft if you participate willingly.
    And you cant say it was unwillingly when there were many other possible paths you could take to not pay taxes at all but you do not. And thirdly i don't get how making you pay for the government services you use is theft. If you don't want to pay taxes go somewhere where there are no services offered by the government and you do not have to pay taxes. I am not reverberating the " if you dont like it move" argument, rather saying that this is the way it is here and there are many places easily accessible that do not use sanctions to make you pay for government services, or that do not have any at all so there is no issue.

    "Taxation is government taking from me and giving to others." is a blatant lie.You receive a lot , and if you make under 250,000 a year you have probably received more from the government in your life time than you have paid to it. Please understand that your idea of theft is actually a misguided attempt to say you don't like the current tax system and feel it gives more of your money to others than back to you. Because economies are measured in wealth not currency, and you receive innumerable benefits that increase your wealth everyday without realizing it.