Tariff follies
Our new emperor has a well-advertised love of tariffs. They appeal to his grandiosity, as dramatic imperial gestures that will bring the world to heel at no cost to Americans, given his stubborn delusion that foreigners, not consumers, pay the duties. Should he carry through with his threats to slap 10%, 20%, 30%, tariffs on imports—many of them on products that aren’t even made here, so there aren’t any domestic substitutes—prices will rise significantly, quite the turn for a guy who ran against Bidenflation. I’ve written about Trump’s tariffs for Jacobin, notably… Read More
Ignore corporate whining
Joe Biden is proposing to finance his badly needed infrastructure program by raising corporate taxes. Business mostly likes the infrastructure program—everything works better when the basics aren’t falling apart—but it doesn’t want to pay for it. Nobody likes paying taxes (well, maybe some oddballs do, but to each their own), but over the last few years, Corporate America has been enjoying the lightest tax burden in history. That needs to change. Graphed below is the effective tax rate—the share of income that’s paid in tax, not the rate that’s on the books,… Read More
Why UI isn’t enough
I’m going to be posting a series of commentaries on the current crisis. Here’s a quick first It’s odd to see Democrats like Pelosi and Schumer objecting to Republican schemes to send everyone a check for $1,000, maybe two. Of course, one- or two-off checks for $1,000 won’t pay many of the the bills for very long. But talk of means-testing right now looks mean, cheap, and politically suicidal. Schumer says that rather than write checks, we should expand unemployment insurance (UI) benefits. It would have to be some expansion. Benefits are low,… Read More
Taxing the rich is only a start, though it’s a good one
It’s become near-consensus on the social democratic left that you can fund a decent welfare state by taxing the rich and shrinking the military. Sad to say that isn’t true. Those are good things in themselves, and you could pay for some excellent things with that agenda, but it would still be well short of actual social democracy. I’m defining social democracy as a large and robust welfare state that socializes a lot of consumption through taxation and spending, compressing the income distribution, reducing poverty sharply, capping the political power of the… Read More
LBO News from Doug Henwood 