5 ms·

As a reminder, before the inevitable flame war starts, http://lesswrong.com/lw/gz/policy_debates_should_not_appear_onesided/ http://lesswrong.com/lw/gz/policy_d

by vec 9y ago

As a reminder, before the inevitable flame war starts, http://lesswrong.com/lw/gz/policy_debates_should_not_appear_onesided/ http://lesswrong.com/lw/gz/policy_debates_should_not_appear_... Policies which are, on net, good can still have some bad effects. Policies which are, on net, bad can still have some good effects. Cherry picking a single microeconomic effect in isolation isn't strong evidence for or against either macroeconomic conclusion. That said, this is good news for Starbucks's workers, and I hope this does become a trend!

sol_remmy 9y ago
Most economics agree that cutting the corporate tax cut would have a good economic effect. If you doubt that it does, realize that you are in the academic minority.
- hsitz 9y ago
  Did you mean to say: ". . . agree that cutting the corporate tax cut would have a NET good economic effect"? First, the new tax law does far more than cut corporate taxes. Second, whether cutting corporate taxes is good or bad thing depends strongly on the size of the cut. Third, if you mean to imply that the majority of academic economists agree that the new tax laws will have a net beneficial effect for the economy over the long term, then I'm pretty sure you're flat out wrong.
  - bassman9000 9y ago
    While there is uncertainty and debate regarding the extent to which lowering statutory corporate taxes to 20 percent might boost worker wages, the CEA’s claim that workers’ income would rise by $4,000 to $9,000 is well above the top of the range of consensus estimates. https://www.pbs.org/newshour/economy/analysis-would-cutting-corporate-taxes-raise-incomes-for-workers https://www.pbs.org/newshour/economy/analysis-would-cutting-...
  - bassman9000 9y ago
    And a different view https://taxfoundation.org/what-evidence-taxes-and-growth https://taxfoundation.org/what-evidence-taxes-and-growth Nearly every empirical study of taxes and economic growth published in a peer reviewed academic journal finds that tax increases harm economic growth.
    - croon 9y ago
      A different view from a Koch funded libertarian climate change denying think tank.
JPKab 9y ago
I've been curious for a while why American left wing political organizations are opposed to a corporate tax rate being at the same level as European countries with significantly more left wing governments. Why the push to follow EU nation's health care systems but be rabidly opposed to similar corporate tax policies?
- marcell 9y ago
  I don’t have a source right now but I have heard that pre tax cut, the effective American rate was similar to the rest of the world for large corporations after deductions. Smaller companies who were unable to deduct got higher rates. I’m not familiar with what the situation is now, after the cuts.
  - vibrio 9y ago
    each company is different, but your point is largely true. One can look the SEC filings to determine the ACUTAL rates payed by Apple, Nike,etc. There is a reason Nike's swoosh IP is held by a non-operating Ex-US entity in a complex accounting stunt. Yes, corporate taxes need to be simplified, but a race to the bottom of corporate rates will not end well for the US , Ireland or anyone.
- thaumaturgy 9y ago
  A lot of people in the US right now are experiencing long-term financial strain. Those on the political right typically follow media streams which have convinced them that this is the result of regulations and taxes; those on the left follow media streams which have convinced them that it's the result of too much wealth being concentrated in the hands of too few people (and implicitly, that it's a result of policies from the political right). Corporations have the resources to navigate tax loopholes that allow them to avoid paying their fair share of social responsibility, and any number of free market worshippers will regularly appear to say, "but of course, they have a responsibility to their shareholders to do so." As a result of those two things together, corporate tax cuts are not popular on the left. If there were any evidence that high corporate tax rates were the root cause of financial strain for the average family in the US, or corporations weren't putting so much effort into dodging taxes, I suspect the left would care a lot less about whether they received tax cuts or not. As it is, the situation has turned into monkeys and cucumbers (https://www.youtube.com/watch?v=meiU6TxysCg https://www.youtube.com/watch?v=meiU6TxysCg -- skip to 1:23 if you're in a hurry), and the left keeps seeing gifts laid at the feet of corporations in the name of trickle-down economics while social programs keep struggling for funding and more people keep needing social programs.
croon 9y ago
Walmart for example spent $0.3B out of $2.2B annual tax cut savings on that wage hike. Sure, a dollar is always a dollar, but when you weigh that against loss of mortgage benefits, grad school stipends, fewer people with health insurance and most likely higher costs in coming years... then that one time bonus or slight wage increase disappears quite quickly. Championing a few dollars (while being significant to a lot of people) is really just misdirection not to look behind the curtain, and frankly quite patronizing.
- vibrio 9y ago
  also, in considering the macroeconomic impact, one should probably net out the ~7500 employees Walmart laid off the same day they announced the increase wage.

by vec 9y ago

sol_remmy 9y ago

Most economics agree that cutting the corporate tax cut would have a good economic effect. If you doubt that it does, realize that you are in the academic minority.

hsitz 9y ago
Did you mean to say: ". . . agree that cutting the corporate tax cut would have a NET good economic effect"? First, the new tax law does far more than cut corporate taxes. Second, whether cutting corporate taxes is good or bad thing depends strongly on the size of the cut. Third, if you mean to imply that the majority of academic economists agree that the new tax laws will have a net beneficial effect for the economy over the long term, then I'm pretty sure you're flat out wrong.
- bassman9000 9y ago
  While there is uncertainty and debate regarding the extent to which lowering statutory corporate taxes to 20 percent might boost worker wages, the CEA’s claim that workers’ income would rise by $4,000 to $9,000 is well above the top of the range of consensus estimates. https://www.pbs.org/newshour/economy/analysis-would-cutting-corporate-taxes-raise-incomes-for-workers https://www.pbs.org/newshour/economy/analysis-would-cutting-...
- bassman9000 9y ago
  And a different view https://taxfoundation.org/what-evidence-taxes-and-growth https://taxfoundation.org/what-evidence-taxes-and-growth Nearly every empirical study of taxes and economic growth published in a peer reviewed academic journal finds that tax increases harm economic growth.
  - croon 9y ago
    A different view from a Koch funded libertarian climate change denying think tank.

JPKab 9y ago

I've been curious for a while why American left wing political organizations are opposed to a corporate tax rate being at the same level as European countries with significantly more left wing governments. Why the push to follow EU nation's health care systems but be rabidly opposed to similar corporate tax policies?

marcell 9y ago
I don’t have a source right now but I have heard that pre tax cut, the effective American rate was similar to the rest of the world for large corporations after deductions. Smaller companies who were unable to deduct got higher rates. I’m not familiar with what the situation is now, after the cuts.
- vibrio 9y ago
  each company is different, but your point is largely true. One can look the SEC filings to determine the ACUTAL rates payed by Apple, Nike,etc. There is a reason Nike's swoosh IP is held by a non-operating Ex-US entity in a complex accounting stunt. Yes, corporate taxes need to be simplified, but a race to the bottom of corporate rates will not end well for the US , Ireland or anyone.
thaumaturgy 9y ago
A lot of people in the US right now are experiencing long-term financial strain. Those on the political right typically follow media streams which have convinced them that this is the result of regulations and taxes; those on the left follow media streams which have convinced them that it's the result of too much wealth being concentrated in the hands of too few people (and implicitly, that it's a result of policies from the political right). Corporations have the resources to navigate tax loopholes that allow them to avoid paying their fair share of social responsibility, and any number of free market worshippers will regularly appear to say, "but of course, they have a responsibility to their shareholders to do so." As a result of those two things together, corporate tax cuts are not popular on the left. If there were any evidence that high corporate tax rates were the root cause of financial strain for the average family in the US, or corporations weren't putting so much effort into dodging taxes, I suspect the left would care a lot less about whether they received tax cuts or not. As it is, the situation has turned into monkeys and cucumbers (https://www.youtube.com/watch?v=meiU6TxysCg https://www.youtube.com/watch?v=meiU6TxysCg -- skip to 1:23 if you're in a hurry), and the left keeps seeing gifts laid at the feet of corporations in the name of trickle-down economics while social programs keep struggling for funding and more people keep needing social programs.

croon 9y ago

Walmart for example spent $0.3B out of $2.2B annual tax cut savings on that wage hike. Sure, a dollar is always a dollar, but when you weigh that against loss of mortgage benefits, grad school stipends, fewer people with health insurance and most likely higher costs in coming years... then that one time bonus or slight wage increase disappears quite quickly. Championing a few dollars (while being significant to a lot of people) is really just misdirection not to look behind the curtain, and frankly quite patronizing.

vibrio 9y ago
also, in considering the macroeconomic impact, one should probably net out the ~7500 employees Walmart laid off the same day they announced the increase wage.