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Another thing that has always bothered me about tax code (and criminal code but that's another story) is the explicit use of constant dollar amounts. For insta

Another thing that has always bothered me about tax code (and criminal code but that's another story) is the explicit use of constant dollar amounts. For instance, how the child tax credit should be $1,000, the minimum wage should be $9.15, and the penalty for illegally parking your car should be $52.13. All of these numbers are completely arbitrary, and if they had any justification when they were decided, they lose their relationship to reality quickly over time as the money supply and other economic factors shift over time. We have computers now. Why can't we write a code where the incentives and disincentives stay where we intend them to relative to the state of the economy?

ptx 9y ago
In Swedish law these numbers are often specified as some multiple of the "price base amount" (prisbasbelopp), so there is a single constant that can be updated from time to time, which indirectly adjust all these other amounts in various laws.
dmoy 9y ago
Or better yet, for the fines at least, relative to income like some euro states :P
JPKab 9y ago
Because politicians (in the aggregate) are stupid lawyers who barely passed math, at least in the US. They come up with ideas, and when special interests and other actors end up completely breaking the intent by changing certain pieces, they still proceed with implementing the broken legislation for public perception reasons of "doing something". See the Affordable Care Act for example. Obama wanted a public option to keep insurance companies in check and help drive down the price-gouging from the providers. Joe Lieberman, as the 60th Democrat in the Senate, was able to block that by pulling his vote, allowing for a fillibuster. He wanted the public option removed, and he got his wish. Obama pushed the law through anyway, despite the fact that this change completely broke the design of the law. Insurance companies now saw it as a subsidy for new customers, which is what it was. The broken design failed to reign in costs, which made the subsidy provided by the government inadequate to make it affordable to the working-class, resulting in the law effectively being a Medicaid expansion and nothing more. The prices charged by insurance companies through the exchange were too high to ease the pain of people too rich for Medicaid but too Obama originally treated it as a huge victory. It wasn't. It was broken on delivery. But hey, they "pushed something through" and "won." Now we are getting honest assessment of it as it implodes, and the Democrats are talking about single-payer again.
- rrhd 9y ago
  The alternative was nothing. A flawed system that leads to single player is still a victory.
Amorymeltzer 9y ago
Couldn't agree more, but it's more complicated than that. Usually if something isn't pegged to inflation via CPI some politician(s) had a reason for that. As an example, say Party A wants to raise the minimum wage but party B wants it lowered or the same. They agree to raise the wage, but don't adjust it annually for inflation. Party A "wins" but every year party B "wins" more and more, as long as it isn't adjusted upward further. An interesting recent example is in the House Republican's tax cut bill. The thresholds for which tax bracket you would fit in are adjusted annually, as they are now, but would be done via chained CPI[1]. Chained CPI grows more slowly, thus meaning that over time, people get pushed toward higher brackets, subtly increasing tax revenues. 1: https://www.vox.com/2017/11/2/16596896/house-republican-tax-reform-cuts-trump-ryan-explained https://www.vox.com/2017/11/2/16596896/house-republican-tax-...

ptx 9y ago

In Swedish law these numbers are often specified as some multiple of the "price base amount" (prisbasbelopp), so there is a single constant that can be updated from time to time, which indirectly adjust all these other amounts in various laws.

dmoy 9y ago

Or better yet, for the fines at least, relative to income like some euro states :P

JPKab 9y ago

Because politicians (in the aggregate) are stupid lawyers who barely passed math, at least in the US. They come up with ideas, and when special interests and other actors end up completely breaking the intent by changing certain pieces, they still proceed with implementing the broken legislation for public perception reasons of "doing something". See the Affordable Care Act for example. Obama wanted a public option to keep insurance companies in check and help drive down the price-gouging from the providers. Joe Lieberman, as the 60th Democrat in the Senate, was able to block that by pulling his vote, allowing for a fillibuster. He wanted the public option removed, and he got his wish. Obama pushed the law through anyway, despite the fact that this change completely broke the design of the law. Insurance companies now saw it as a subsidy for new customers, which is what it was. The broken design failed to reign in costs, which made the subsidy provided by the government inadequate to make it affordable to the working-class, resulting in the law effectively being a Medicaid expansion and nothing more. The prices charged by insurance companies through the exchange were too high to ease the pain of people too rich for Medicaid but too Obama originally treated it as a huge victory. It wasn't. It was broken on delivery. But hey, they "pushed something through" and "won." Now we are getting honest assessment of it as it implodes, and the Democrats are talking about single-payer again.

rrhd 9y ago
The alternative was nothing. A flawed system that leads to single player is still a victory.

Amorymeltzer 9y ago

Couldn't agree more, but it's more complicated than that. Usually if something isn't pegged to inflation via CPI some politician(s) had a reason for that. As an example, say Party A wants to raise the minimum wage but party B wants it lowered or the same. They agree to raise the wage, but don't adjust it annually for inflation. Party A "wins" but every year party B "wins" more and more, as long as it isn't adjusted upward further. An interesting recent example is in the House Republican's tax cut bill. The thresholds for which tax bracket you would fit in are adjusted annually, as they are now, but would be done via chained CPI[1]. Chained CPI grows more slowly, thus meaning that over time, people get pushed toward higher brackets, subtly increasing tax revenues. 1: https://www.vox.com/2017/11/2/16596896/house-republican-tax-reform-cuts-trump-ryan-explained https://www.vox.com/2017/11/2/16596896/house-republican-tax-...