Sunday, May 21, 2006
Greg Mankiw busts Robert Reich's liberal canard
Former Clinton Labor secretary Robert Reich - a reliable redistributionist - argues that "we've turned a progressive tax system on its head."
Greg Mankiw turns Reich upside down and spanks him like a newborn baby.
Liberals hate it when we check the data.
Greg Mankiw turns Reich upside down and spanks him like a newborn baby.
Liberals hate it when we check the data.
Comments:
It's not fair to use data or facts when arguing with a liberal. You have to use feelings only, or it's cheating.
http://www.optimist123.com/optimist/2006/05/tax_cuts_cuttin.html
Same basic facts, but I love how the Skeptical Optimist presents it in a user friendly chart.
Same basic facts, but I love how the Skeptical Optimist presents it in a user friendly chart.
I read thru the comments on Greg Mankiw's blog, and it's all blither and balderdash. none of these idiots have the foggiest intention of presenting reasoned arguement; they are trying to score political points for their point of view.
At base, this is a statistical arguement and all the statistics are biased by extreme outliers. Tax policy can not be based on the effects of a tenth of percent of the population with extreme high income.
The comments that accompany the chart at the Skeptical Optimist also show a lack of accuracy, and perhaps candor. A fair number of those paying zero tax are low income filers who never paid tax in the past, and therefore have not gotten a tax cut at all.
At base, this is a statistical arguement and all the statistics are biased by extreme outliers. Tax policy can not be based on the effects of a tenth of percent of the population with extreme high income.
The comments that accompany the chart at the Skeptical Optimist also show a lack of accuracy, and perhaps candor. A fair number of those paying zero tax are low income filers who never paid tax in the past, and therefore have not gotten a tax cut at all.
# posted by 
: 9:11 AM
: 9:11 AM
Well, that's not quite true, insofar as we're recognizing the possibility of a 'negative income tax.'
If someone has zero tax liability in 2004, and then nothing changes except he or she qualifies for a new or expanded tax credit (e.g., Lifetime Learning, retirement savings, child tax credit, etc.) then this individual's tax liability goes below zero. In that case, we have, in effect, a tax cut accruing to the benefit of someone who starts out with a baseline tax liability of zero.
This could easily occur if, say, Mrs. Nussbaum's husband dies, leaving a life insurance policy. The death benefit is tax free. Mrs. Nussbaum uses some of the money to go to school and puts the rest in a retirement account. She doesn't have to work. She therefore accrues no income tax liability (death benefits from life insurance policies are tax free), and qualifies for two tax credits - low-income retirement savings and lifetime learning.
If someone has zero tax liability in 2004, and then nothing changes except he or she qualifies for a new or expanded tax credit (e.g., Lifetime Learning, retirement savings, child tax credit, etc.) then this individual's tax liability goes below zero. In that case, we have, in effect, a tax cut accruing to the benefit of someone who starts out with a baseline tax liability of zero.
This could easily occur if, say, Mrs. Nussbaum's husband dies, leaving a life insurance policy. The death benefit is tax free. Mrs. Nussbaum uses some of the money to go to school and puts the rest in a retirement account. She doesn't have to work. She therefore accrues no income tax liability (death benefits from life insurance policies are tax free), and qualifies for two tax credits - low-income retirement savings and lifetime learning.
Lack of Candor?
He simply states that 31% of Americans pay NO federal income tax.
Yeah, a tax cut is not possible at that point, but isn't that the point?
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He simply states that 31% of Americans pay NO federal income tax.
Yeah, a tax cut is not possible at that point, but isn't that the point?
