Posted on 04/01/2009 9:51:12 PM PDT by LifeComesFirst
Over the last decade, Eastern European countries became darlings of the far right by instituting free-market economic policies designed to break convincingly from their Communist past. The so-called Baltic Tigers—Latvia, Lithuania, and Estonia—garnered worldwide plaudits for a number of free-market reforms, led by the imposition of a flat-rate income tax, especially from the American right. "The flat tax is making a comeback," trumpeted the conservative National Review. The three nations are "leading a global tax reform revolution," said the right-leaning Heritage Foundation.
The idea behind a flat tax is deliciously simple: Charge one uniform rate of income tax for all payers, regardless of their relative wealth. That, say its advocates, will end tax cheating and bring in higher revenues than the usual graduated tax system used in the United States and most other countries. Before the Eastern European "revolution," the loudest proponent of the flat tax was Steve Forbes, a former Republican presidential candidate and the editor-in-chief of Forbes. Of course, thus far American policymakers have not shown much more appetite for the flat tax than American voters did for Steve Forbes' candidacy, which is why the right was so excited that the idea took hold abroad.
(Excerpt) Read more at thebigmoney.com ...
Yes, a 100% tax on the “rich” is much bter. They deserve it anyway, for working so much and for being greedy.
So the flat tax concept is now proven wrong because it could not support a giant welfare state? I think this case study of these nations, as well as western Europe and the US actually show pretty strong evidence that welfare states are unsustainable and bad policy.
Flat Tax and “generous welfare state” go together like bare skin and hydrofluoric acid.
This article is one big straw man argument. The flat tax did not in any way cause the recession in these countries, they went into recession because the whole world, flat tax or no, is in a recession due to the collapse of the housing bubble in the US and its subsequent domino effect throughout the world.
No serious economist that I am aware of promises that a flat tax will lift revenues. It *may* lift revenues, but that is not the point. Economic growth, ease of collecting taxes, and a clear-as-day understanding of nationwide tax rates are the point. A flat tax functions as a “price” tag on the government, whereas progressive taxes, corporate taxes, taxes on yachts, whiskey, cigarettes, cars, or latex are all “hidden” taxes in the sense that they are hidden from most people—it distorts peoples’ understanding of how much money the government is levying. Many flat taxes were designed to be revenue neutral. Flat taxes aren’t supposed to make countries impervious to recessions. Budget deficits are a function of revenue AND SPENDING.
Cut spending, you cut your deficit. Just because it’s not politically feasible doesn’t mean the actual economics don’t make sense.
This is nothing more than an author using the recession to fight a policy he doesn’t like and which is unrelated to the recession.
A flat tax is not a frozen tax, it can be raised or lowered, as can spending. The idea is that it equally effects everybody’s income or consumption (depending on whether its an income or consumption tax, most economists favor a consumption tax), that’s what a flat tax is. Whether the tax is too low in somebody’s opinion is beside the point. “High” or “low” are not attributes of a flat tax. It is merely a tax that is neither progressive nor regressive, it’s flat. It’s flatness tells us nothing about whether it’s comparatively low or high.
They comment on it as if the the rich and the poor are paying the same actual amount instead of a percentage.
Who cares what socialist Gordon Brown who loves Obama, even after the poor way Obama received him in the U.S., has to say.
I like your screen name and your tag name. Both are very true.
This guy is extremely biased, and incompetent at agitation.
Couldn’t make it through page one.
Comparing ex-Soviet bloc nations to Western Europe and trying to draw parallels? The most glaring conclusion of Europe’s collapse is the failure of Western Europe to lower tax rates, which doomed the periphery of the Eurozone to easy credit from Eurozone hot money flows.
The most progressively taxed nations in Europe would have collapsed if Uncle Same didn’t step in. Denmark almost defaulted due to AIG’s collapse, Sweden had already collapsed in 1991, Iceland collapsed. Most of Berlin, a perpetually bankrupt municipality, has suffered for decades as the upper income population hid money in Austria Lichtenstein and Switzerland.
What is this guy’s point, a single world wide progressive income tax regime? It’s the only final thoughts any thinking person can walk away with after reading this rubbish.
Why post this garbage on FR? I lost two bets on when Slate would fold, back in 2002/2003. I’m ready however to put up another bet they fold before New Years Day 2010.
The problem is not tax collection, it is overspending by the government. That is why we need to limit the amount of money the Feds have to spend. And force them into doing it. We have to push back!
Charles Wallace is merely demonstrating that having “****ing idiot” on a resume will keep you in beer and pretzels writing for Slate...
Now why did you have to bring sound reasoning into this? Darn you! Darn you to heck!
It’s a common left-wing debating tactic (actually, it’s common among any group that is typically wrong on everything) to use semantics to make two different things seem as if they were equivalent. Comparing identical tax rates as if they were identical nominal payments, comparing a fertilized human egg to a one-celled amoeba, etc.
I post left-wing articles because it’s important that we don’t become an echo-chamber. We need to know how the other side thinks, what they are talking about. You need people who are wrong in order to sharpen up your thinking and your debating skills.
I have noticed (and long ago) and agree. : )
For the life of me, I don’t recall any advocate for the flat tax claim that it would eliminate the business cycle.
Slate should be ashamed for giving this guy a megaphone.
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