The Economics of Soaking the Rich [Krugman <3 A.O.C.]

New York Slimes ^ | Jan. 5, 2018 | The Nobel Prize Winner Himself

[sphinx]

What the socialists really want isn’t a punishing income tax on the rich; rather, they want a wealth tax.

What the socialists really want is the political class at the top of the income and wealth distribution. They are driven by resentment, envy and status competition.

[outofsalt]

"And it’s a policy nobody has every implemented, aside from … the United States, for 35 years after World War II"

And LBJ's "great society" eradicated poverty and social injustice during that time. Oh, wait...

[Phil DiBasquette]

A Magic 8-Ball would be more articulate on economic matters than Occasional Kotex-the distaff 0bola

[NonValueAdded]

Take heart, fellow FReepers. Since Krugman is universally wrong about everything, this bodes well for lower marginal rates. Is he citing the same experts who are universally surprised at each jobs report (a real measure of the economy)? The same experts who fed Barry the idea than GDP will never rise above 3%?

I think his own graphic disproves his assertion.

Superimpose a background showing control of Congress and the White House on that chart. What do you see? The Reagan cuts coupled with Newt's Contract With America shows the tax cuts had a dramatic effect. Then look at when the bamster took office and we got the Pelosi / Schumer Congress. Wow, what a dip. Extend this chart out to the future and we should see a complete trashing of Krugman's premise.

What can I surmise from this? Exactly what DJT is trying to implement: Take the twin shackles off the productive members of society - high marginal rates and stultifying regulation - and it actually works.

[kvanbrunt2]

Warren Buffet, like Mark Zuckerberg takes a nominal income, so yeah, their secretaries pay more in INCOME taxes, but those guys don’t derive their wealth from income.>>>>
i find it interesting that the socialists have redefined the word income to mean wages. The supreme court changed the original meaning of the word “income” in the “glenshaw glass” case. Wages where not originally taxed under the law. income is derived from a source: stock appreciation, dividends etc.

[No.6]

A confiscatory tax plan like that doesn’t actually result in 70% of rich people’s income being collected.

As with all other punitive taxes, the authors assume people will blindly work to benefit the Big Government and not amend their behaviors. They do. Also, if they already have money, they use that current money to protect their future money by building in complexities in the tax so they can escape it. What’s left from that they dodge by alternative revenue (stocks, ownerships, art deals, as others above pointed out)

The tl;dr is that these taxes are creators of tax lawyers and IRS agents and creators of swampy “collector” dealers, not creators of tax revenue. It only hits people attempting upward mobility who don’t already have a framework of wealth and connection.

Since that’s the world leftists want (neo-feudalism) we see these schemes.

[pfony1]

Why doesn’t Herr Doktur Krugman demand that all salaries in the Economics Department at Princeton be “equalized”?

Then the janitors would earn as much as the High Professors. That would be “fair”, wouldn’t it, Paul?

Moreover, if the janitors also start “teaching”, wouldn’t the students at Princeton actually learn more about the real world?

N.B.: Krugman may be a dwarf, but he is NOT “Happy”.

[pfony1]

Why doesn’t Herr Doktur Krugman demand that all salaries in the Economics Department at Princeton be “equalized”?

Then the janitors would earn as much as the High Professors. That would be “fair”, wouldn’t it, Paul?

Moreover, if the janitors also start “teaching”, wouldn’t the students at Princeton actually learn more about the real world?

N.B.: Krugman may be a dwarf, but he is NOT “Happy”.

[econjack]

I’ve met Galbraith twice. For those who don’t know, he was head of Kennedy’s Council of Economic Advisors. He was a 6’7”, condescending, SOB. I once heard him say: “I’ve never met another economist I looked up to.” The gall: virtually all of his work was stolen from Thorstein Veblen.

[econjack]

Another reader here posted that there is precedence for this. The people in Puerto Rico are US citizens, but don’t pay taxes and cannot vote in Federal elections. Hmmm...

[HotHunt]

If you haven't read Ayn Rand's Atlas Shrugged, the chapter on the 20th Century Motor Corporation provides a perfect example of what you suggest.

*Spoiler Alert* My comments may contain important plot information for those who have not read the novel.

The 20th Century Motor Company was written into the book as a microcosm of any society that tried to organize itself under the principles of the Communist Manifesto by Karl Marx.

Rand uses the story of the successful company's decline to demonstrate the utter unworkability and monumental injustice of life under communism or any other form of collectivism.

The symptoms of the decline of the company illustrated all of the ills that communism brings to any society (or in this instance, a successful capitalist corporation) that adapts its precept that all the employees work according to their ability, and "pay" them according to their needs.

This "new business plan" devised by the heirs of the deceased founder of the previously successful company, set the course for the company into a four year decline and eventually into bankruptcy.

The disastrous plan established by the company founder's socialist heirs, set in motion an inevitable decline in morale, resentment between employees and the decline in productivity and quality of the product because the company rewarded laziness and punished good work.

Important and valuable lessons to be learned for Paul Krugman, this new democRATic Socialist Party of Alexandria Ocasio-Cortez and her worthless great grand uncle, Bernie Sanders.

But they will not learn from these examples provided by current day Venezuela or the account of the fictional 20th Century Motor Company. They are stuck on stupid.

[az_gila]

I did like the comment that no-one else has done the high tax rate thing before...:^)

The famous Nobel Prize winner must have forgotten about the Beatles Taxman song - written after they found that they hit the UK 95% surtax rate. I remember in the 60’s that sports stars were careful to be in the UK for less than a set number of days so they didn't kick in UK tax rates. IIRC Switzerland or Monaco was their favourite spot to live.

Let me tell you how it will be
There's one for you, nineteen for me
‘Cause I'm the taxman, yeah, I'm the taxman
Should five per cent appear too small
Be thankful I don't take it all
‘Cause I'm the taxman, yeah I'm the taxman
If you drive a car, I'll tax the street,
If you try to sit, I'll tax your seat.
If you get too cold I'll tax the heat,
If you take a walk, I'll tax your feet.
Don't ask me what I want it for
If you don't want to pay some more
‘Cause I'm the taxman, yeah, I'm the taxman
Now my advice for those who die
Declare the pennies on your eyes
‘Cause I'm the taxman, yeah, I'm the taxman
And you're working for no one but me.

[logician2u]

Add to those this site, where Bob Murphy and Tom Woods refute, in their weekly podcast, just about every word Krugman writes in his NY Slimes column:

Contra Krugman

It's unfortunate that relatively few of our Republican politicians are well-versed in classical economics. Those who claim to have studied econ at some point were most likely given the standard textbook (Samuelson) as if it was the Bible, without any mention of classical or (heaven forbid!) Austrian alternatives to Keynesian theory.

Some of us were lucky, having read Hazlitt and Bastiat in high school, and, of course, had to take a lower grade as punishment for disputing the instructor. A fair trade as far as I'm concerned, since a dozen other students in my classes eventually saw the light as a result.

If only they had all been elected to Congress . . .

[riverdawg]

” ... if the janitors also start “teaching”, wouldn’t the students at Princeton actually learn more about the real world?”

It would certainly be true at Boston University, where AOC received a degree in economics yet doesn’t understand how the unemployment rate is calculated.

[riverdawg]

“He was a 6’7”, condescending, SOB. I once heard him say: ‘I’ve never met another economist I looked up to.’”

Galbraith was making a joke (albeit with a double meaning) about his height. However, he must never have met Dennis Aigner, who is 6’8”.

[Rusty0604]

Thanks. I studied econ in college, and fortunately was exposed to different theories. Also I studied on my own Austrian economics. One of my favorite sites,

https://mises.org

I agree with you, I have always said it should be mandatory for every elected official to have learned economics, all the theories.

[Ban Draoi Marbh Draoi]

Exactly.

Fork over 70% of your income bub.

Watch him squeal.

[Ban Draoi Marbh Draoi]

If it was just those morons getting soaked, I would not be concerned.

If anything, it would force the hypocrites to live by their own rules.

[Fred Barber]

Please don’t forget the payroll taxes ( such as Medicare, Medicade & Social Security taxes)that ARE paid by everyone, even if income taxes aren’t.

Those payroll taxes topped out above a certain amount, above which higher income earners didn’t pay.

I remember a debate where Sen. William Roth claimed the “rich” paid 60% of the taxes. Sen Bill Bradley remarked “You’re forgetting non-income taxes,” and Roth quickly revised his figure to 40%.

[econjack]

Which is why I said income taxes.