November 17, 2019

TAX WHAT YOU DON'T WANT, NOT WHAT YOU DO WANT:

Here's just how big a risk Elizabeth Warren and The New York Times want America to take (James Pethokoukis, November 8, 2019, AEIdeas)

The World Economic Forum's new global competitiveness report ranks the US economy as the most competitive big economy in the world, calling it an "innovation powerhouse." Likewise, no other big economy generates as many super-entrepreneurs or high-impact startups. Jeff Bezos, the Google Guys, Mark Zuckerberg, and Elon Musk aren't superrich because their parents were billionaires or they were cronies of top politicians. They built companies that consumers and customers greatly value, with their wealth -- as massive as it is -- reflecting only a tiny portion of that value creation.

Now here comes the Warren plan. First, tax the wealthy in a way and at levels that most other advanced economies have abandoned. (Only four of the 15 European countries that tried even a tiny wealth tax in recent years have stuck with it. And, by the way, the much-praised egalitarian nations of Scandinavia have as many billionaires, relatively, as the US does) 

Second, tax corporations at levels all other advanced economies reject. (Rich countries have top corporate rates only slightly higher than the US rate, with Scandinavia about the same.) 


An economy literally exists to generate wealth.  The idea that we should tax wealth to the maximum extent possible is best thought of as anti-economics.  Instead we ought to tax behavior that dissipates wealth: consumption.

Posted by at November 17, 2019 12:20 PM

  

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