late wrote:You didn't defend your MMT is false statement.
Yes I did. Maybe you should read SA's file to understand what I'm responding to.
late wrote:Velly interesting...
Krugman addressed that point a few months ago. "while it may literally be true that a government with its own currency can’t go bankrupt, it can destroy that currency if it loses fiscal credibility."
And not just "destroy its currency", the consequences of something like that are devastating for all parties involved, including the government itself. Even mild versions like e.g. Argentina cause problems.
late wrote: I have NEVER said I was a MMT guy, so implying that's what I am is another mistake.
late wrote:I said Tax Foundation, not Zucman, nice dodge.
They are citing Zucman, and they are doing so accurately as I found the same data in the paper.
late wrote: But there is something Zucman said: "Because top marginal tax rates, tax evasion technologies,and tax enforcement strategies have changed a lot over time, tax data may paint a biased picture of income concentration at the very top."
And it would conceivably be worse for the 1950s if anything. This is from another paper from SZ:https://gabriel-zucman.eu/files/SaezZucman2020JEP.pdf
It would seem the loophole issue was worse in the 1950s than the 1980s, largely because the reforms from the 1980s were aiming to close loopholes and make the tax system easier to manage (hence the closing of the gap between the shares of the top 1% in the fiscal vs national income). Broad base + low tax rates are better than a narrow tax base with high rates from a tax collection perspective, because the latter means there are greater incentives to look for loopholes (it's also better from an efficiency point of view, simply because there is no point in changing sectors or selling particular goods to pay less taxes if they are all treated equally, or less unequally). And it' arguably fairer and more consistent with equality before the law, as there is no obvious reason why a doctor, an university professor, a high-ranked government official, a CEO and a business owner who all make $500,000/year should face different income tax rates.
late wrote: Meaning that if you want to argue the Reagan crowd didn't make cheating on taxes easy and safe, I could use the laugh.
Do you really believe that the old boy networks and lobbies did not exist in the 1950s?
late wrote:I recently read a good analysis on tax rates. Back then, a CEO had a fairly modest lifestyle. That wasn't just the result of taxes. They pushed for, and got, big pay increases starting in the 1960s. Malcolm Gladwell has a good video about how that happened.
Meaning there was more going on than just taxes, but that 1950s tax rate was a big deal.
Maybe, I'd need to look at the data. But actually the US was more egalitarian in the 1970s than the 1950s if you measure inequality using the share of the top 1% shown above. And it makes sense, simply because Jim Crow was largely in force in the 1950s (yes, it had begun to be dismantled back then but much of it remained in force) and had been mostly dismantled by the 1970s, this obviously has effects in the income distribution and furthermore signals a greater concern about inequality.
late wrote:Oh, and thanks for finding that Zucman article. He's saying similar things as what Stiglitz and Krugman are saying.
Yes, because Zucman is a progressive and advised Liz Warren's campaign in 2020 - and he's more influential than Stiglitz and Krugman in progressive circles FWIW. So I don't understand why would you just disregard his data on the income distribution, even if it quite obviously supports the idea that this strange narrative that the US was egalitarian and people somehow did not use tax loopholes to pay less taxes in the good ole 1950s is just false.
If you try to go back to 1950 levels of statutory tax rates, what will actually happen is that plenty of loopholes will start to appear, perhaps under the guise of "supporting small businesses" or "supporting the green economy". And who knows, maybe you believe the green economy should be supported - sure, indeed, loopholes often exist not as a result of lobbying but because the legislator wanted to incentivize some sectors that were regarded as being "good" for society (and having a greener a economy would probably fall into that category). But the problem with this is that those loopholes are rarely closed when they stop being necessary, make tax collection harder and are not transparent about just how much money is the government "spending" (in terms of a lower tax revenue) in doing so. Subsidies may be slower to handout/manage in practice, but they do have the merit of being fully transparent about just how much the government is spending on them.