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I can get behind the idea of tariffs as solid policy, but not in the way they're currently implemented. Most economists believe that consumption taxes are more efficient than income taxes, as long as you take steps to minimize the regressivity. Further, targeted tariffs can help protect and rebuild domestic industries that maintain vital domestic supply.

Unfortunately, we've supercharged the regressivity of tariffs instead of mitigating them. And the haphazard way in which we've invoked them (and uninvoked and re-invoked, ad nauseum) means that foreign markets will have no choice but to substitute around American imports and exports as much as they can.
 
Huh? said:
I can get behind the idea of tariffs as solid policy, but not in the way they're currently implemented. Most economists believe that consumption taxes are more efficient than income taxes, as long as you take steps to minimize the regressivity. Further, targeted tariffs can help protect and rebuild domestic industries that maintain vital domestic supply.

Unfortunately, we've supercharged the regressivity of tariffs instead of mitigating them. And the haphazard way in which we've invoked them (and uninvoked and re-invoked, ad nauseum) means that foreign markets will have no choice but to substitute around American imports and exports as much as they can.
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This is fascinating. I’m not really smart or well-versed when it comes to economic policy but I’m intrigued by the notion that strategic tariffs can be better than taxing income. I did not know and had not really thought of that. I am definitely of the opinion that the way that we tax earned W2 income feels extremely punitive for the upper-middle and upper brackets, but I hadn’t really thought of a better way to do it.
 
Consumption tax proponents maintain that it promotes savings and investment. The main drawback is the regressivity - the poor have to pay a higher portion of their income on consumption than the rich do. The traditional methods to combat that are to exclude essentials from taxation - food, drugs, etc. and to increase the progressivity of the income tax.

It's important to remember economists are better expounding on theory than practical solutions. In real life, the VAT, which is a consumption tax, is probably the most universally despised tax around today.
 
heelinhell said:
I've been day drinking since 7am so I hope you will indulge this old codger if I take a stroll down memory lane...

I was sitting on the deck of my beach front home at beautiful Topsail Beach with my best friend who was savvy when it came to investing. It was the summer of 2006 during the housing bubble. We agreed that when the housing bubble burst it would put to shame the tech bubble burst in 2002.

I told my friend that this house is so over priced, I'm thinking I should sell it. My friend said it was a no brainer. I did sell it before the burst of the housing bubble and the Great Recession

I recall this because I am feeling the same way about where we find ourselves today when it comes to the economy and the stock market.
We are riding the rocket like we did in 2002 and 2006. I fear we are will be on a similar path in 2026 ...but I could be wrong
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Have you bothered to look at the trading valuations of the S&P. There are many companies, even among the mag 7, that aren't overpriced and have considerable room to grow with respect to P/E. A feeling isn't a sound investment strategy.
 
CFordUNC said:
This is fascinating. I’m not really smart or well-versed when it comes to economic policy but I’m intrigued by the notion that strategic tariffs can be better than taxing income. I did not know and had not really thought of that. I am definitely of the opinion that the way that we tax earned W2 income feels extremely punitive for the upper-middle and upper brackets, but I hadn’t really thought of a better way to do it.
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Spoken like a true republican who's spouse is likely to be in one of the higher brackets at some point in the future.
 
Callatoroy said:
Spoken like a true republican who's spouse is likely to be in one of the higher brackets at some point in the future.
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Hey now! I like to think I pull more than my fair share of weight in getting to those top brackets! :)

In all seriousness, though, I do think the way that we tax earned income in this country is irritating. It’s not that I’m opposed to paying my fair share or anything, but rather that the people who get squeezed the absolute most proportionately are the dual-household income earners in the higher brackets. Even though I do vote Democratic at the national level these days, I’m definitely a policy mutt in that there are plenty of classical conservative policies with which I still find common ground- taxation being a primary one.
 
CFordUNC said:
Hey now! I like to think I pull more than my fair share of weight in getting to those top brackets! :)

In all seriousness, though, I do think the way that we tax earned income in this country is irritating. It’s not that I’m opposed to paying my fair share or anything, but rather that the people who get squeezed the absolute most proportionately are the dual-household income earners in the higher brackets. Even though I do vote Democratic at the national level these days, I’m definitely a policy mutt in that there are plenty of classical conservative policies with which I still find common ground- taxation being a primary one.
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That baffles me because the core of the political divide in this country is rooted in money and how people want to spend other people's money. The term "fair share" that the left likes to throw around (its a top 10. Right behind bigot) has always rubbed me the wrong way. Who are people paying less than me to determine what my "fair share" is?

Going off on a tangent, I have been thinking a lot lately about the useful life of capitalism as it relates to the widening wealth gap in the country. How do you preserve it but slow down the increasing gap without tanking the economy? The most readily identifiable ways are taxation, revolution, and g'ment regulation. I'm thinking it may be possible to do it with some form of g'ment regulation tied to education. In any case, it can't go on indefinitely without dire consequences.
 
Callatoroy said:
That baffles me because the core of the political divide in this country is rooted in money and how people want to spend other people's money. The term "fair share" that the left likes to throw around (its a top 10. Right behind bigot) has always rubbed me the wrong way. Who are people paying less than me to determine what my "fair share" is?

Going off on a tangent, I have been thinking a lot lately about the useful life of capitalism as it relates to the widening wealth gap in the country. How do you preserve it but slow down the increasing gap without tanking the economy? The most readily identifiable ways are taxation, revolution, and g'ment regulation. I'm thinking it may be possible to do it with some form of g'ment regulation tied to education. In any case, it can't go on indefinitely without dire consequences.
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I also cringe at the “fair share” term.

Somewhere there is a formula for the amount of taxes people and corporations should pay (most likely there will be levels where higher earner pay a higher percentage) to meet the government’s obligations. That’s what the tax rates should be.
I don’t think it has anything to do with what is fair. It has to do with what is optimal.
 
ChileG said:
I also cringe at the “fair share” term.

Somewhere there is a formula for the amount of taxes people and corporations should pay (most likely there will be levels where higher earner pay a higher percentage) to meet the government’s obligations. That’s what the tax rates should be.
I don’t think it has anything to do with what is fair. It has to do with what is optimal.
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In other words, economic efficiency. I'm not sure that should be the sole factor in tax policy, but it should certainly be the main driver.
 
"Fair share" means too many things to too many people. I live in s state that gets less from the feds than we provide, live in a county that gets way less back than what the state provides, and am in one of the higher tax brackets. I don't mind any of that as long as the government provides a stable currency, stable business investment environment (incremental regulation and stable interest rates) and stays out of my personal space. If they do that, i can figure out the life, liberty and pursuit of happiness part of the deal.

What I want as an individual from my tax system is something that's easy to administer, easy to calculate, and easy to pay. Fewer deductions would be a great start - over the years, I've taken advantage of tax breaks on mortgages, education savings and retirement savings on financial decisions I would have made had the tax breaks not been available. That seems inefficient to me. I'd trade all of those for abolishing the AMT in a heartbeat.
 
ChileG said:
I also cringe at the “fair share” term.

Somewhere there is a formula for the amount of taxes people and corporations should pay (most likely there will be levels where higher earner pay a higher percentage) to meet the government’s obligations. That’s what the tax rates should be.
I don’t think it has anything to do with what is fair. It has to do with what is optimal.
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If you add "the declining marginal utility of money" to "optimal" you get progressive taxation and something that comports with the common sense notion of fair.

If there's a famine, and there's a guy in town hoarding 100 loaves of bread, and everyone else is hungry, I don't think anyone would dispute that it would be fair to take bread from the rich guy to distribute to the hungry. That's because we intuit the declining marginal utility of money (or in this case, assets more generally). Right?

I don't think it's all that difficult to define "fair" to a first approximation.
 
At what point does an average person care more about power than money? Where do the two cross on a line graph? If we could improve education to a level of 50% above our current level of functional education how many generations would it take to reduce poverty by 50%?
 
superrific said:
If you add "the declining marginal utility of money" to "optimal" you get progressive taxation and something that comports with the common sense notion of fair.

If there's a famine, and there's a guy in town hoarding 100 loaves of bread, and everyone else is hungry, I don't think anyone would dispute that it would be fair to take bread from the rich guy to distribute to the hungry. That's because we intuit the declining marginal utility of money (or in this case, assets more generally). Right?

I don't think it's all that difficult to define "fair" to a first approximation.
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Sure, but you understand that terminology turns a lot of people off and puts them on the defensive.
Democrats can stick to their messaging if they want, but changing “fair share” to “optimal” is easier for a lot more people to accept, I think.
 
apnews.com

Intel's stock tumbles after Trump says its CEO must resign

Intel’s shares slumped Thursday as President Donald Trump said in a social media post that the chipmaker’s CEO must resign immediately.
apnews.com apnews.com

What kind of government tells businesses how to run their companies? I think it starts with "comm" and ends with "unism", but I can’t quite remember. Maybe our board conservatives can help me out, because I remember this used to be very important to them.
 
Huh? said:
Consumption tax proponents maintain that it promotes savings and investment. The main drawback is the regressivity - the poor have to pay a higher portion of their income on consumption than the rich do. The traditional methods to combat that are to exclude essentials from taxation - food, drugs, etc. and to increase the progressivity of the income tax.

It's important to remember economists are better expounding on theory than practical solutions. In real life, the VAT, which is a consumption tax, is probably the most universally despised tax around today.
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You left out the biggest problem. We are a consumption economy and taxes on consumption discouraged the one thing that keeps our economy afloat.

Everyone saving at the same time is terrible for the economy. Look at Japan. Or look at the Great Depression when people stopped consuming.

I seriously doubt economists have the view of consumption tax you think they do.

And if I seem a little harsh, well my son just shit his pants for the second time tonight so I am in that kind of mood. But I think your theory on consumption tax is complete bunk.
 
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