Intermarkets' Privacy Policy
Support


Donate to Ace of Spades HQ!





Recent Entries
John Lott: Why Doesn't Obama Propose the Stimulus He Actually Campaigned On? | Main | The Bitch Set Me Up: Prosecutors Seek Jailtime for Marion Barry over Taxes
February 10, 2009

A Genuine Economist Also Thinks Payroll Tax Cuts Are a Great Idea

As I've pitched before. I don't know if Mankiw's idea is this dramatic, but Flip Pidot ran the numbers and for the $1.2 trillion the stimulus was (it's growing), we could cancel all employer-paid payroll taxes for 2 1/2 years, or cancel both employer and employee paid taxes for 1 and 1/4 years.

Using standard economic modeling, such cuts should result in a gain of 2.8 million jobs, Flip found.

He pushes his own spin on the idea here.

Mankiw's idea is a bit different. He wants to link this cut to a hike in gas taxes, so that the two end up being revenue-neutral-- over time. At first, it would just be the tax cut, to give the economy a jolt; the hike in gas taxes would be phased in during the recovery.

He sort of has to propose such a thing, because I think he's talking permanent cuts to these taxes, and he has to make up the revenue (for SS and Medicaid and etc.) from some source.

Eh, it's an idea. For those upset by the idea of the gas-tax hike -- well, again, it's revenue neutral as ultimately implemented, so in theory the drop in payroll taxes should equal, more or less, the additional taxes you're paying at the pump.

And while I generally buy the "don't raise taxes, ever" notion, I don't think Mankiw's gas-tax hike is a bad idea as part of this package. If the same amount of taxes are to be extracted from us either way, it seems to make more sense, to me at least, to lower the costs of business and employing workers while raising a tax on gas that will encourage more fuel-efficient vehicles. And no, I don't give a crap about carbon; I care about putting money in the hands of "countries that don't like us very much," as McCain said.

(It occurs to me now that if that actually happens, we won't have as much revenue coming in via the gas tax, and somewhere taxes will have to be raised. Well, maybe. Sometimes a dynamic change in the tax structure encourages more growth and thus generates more revenue even at lower rates of taxation.)

Not sure where I saw this, but I think even super-lefty Juicebox Mafia bogger Matthew Inglesias called it "indefensible" that the stimulus did not have some payroll tax cuts.


digg this
posted by Ace at 04:04 PM

| Access Comments




Recent Comments
Costanza Defense: "Obama's Strategic Communication Strategy ------ ..."

Lizzy: "O/T - Anyone see the clip of (Sherlock)Benedict Cu ..."

Chupacabras: "Can blame a white and Bush, he's going to be besid ..."

logprof: ""I Love Science Sexually" Ace will like this one: ..."

Chupacabras: "OT, but keep seeing the trailers for that new Bad ..."

jwest: "I know so little about this particular subject tha ..."

Marie Harf: "Like, um, the buck is like somewhere, OK? ..."

rickb223[/s][/b][/I]: "I hereby nominate Judge Ron White for the Irony Th ..."

TheEmperorCletusAugustus: "@11 just saw it. I'm lame. ..."

Mikey NTH - Harvesting Howls of Anguish & Rage at the Outrage Outlet!: "White was appointed to the federal bench by George ..."

Harry Truman: "I always hated...Illinois. ..."

Blanco Basura: "[i]Fuck that ice bucket challenge bullshit.Step up ..."

Recent Entries
Search


MuNuvians
Polls! Polls! Polls!
Frequently Asked Questions
The (Almost) Complete Paul Anka Integrity Kick
Top Top Tens
Greatest Hitjobs

The Ace of Spades HQ Sex-for-Money Skankathon
A D&D Guide to the Democratic Candidates
Margaret Cho: Just Not Funny
More Margaret Cho Abuse
Margaret Cho: Still Not Funny
Iraqi Prisoner Claims He Was Raped... By Woman
Wonkette Announces "Morning Zoo" Format
John Kerry's "Plan" Causes Surrender of Moqtada al-Sadr's Militia
World Muslim Leaders Apologize for Nick Berg's Beheading
Michael Moore Goes on Lunchtime Manhattan Death-Spree
Milestone: Oliver Willis Posts 400th "Fake News Article" Referencing Britney Spears
Liberal Economists Rue a "New Decade of Greed"
Artificial Insouciance: Maureen Dowd's Word Processor Revolts Against Her Numbing Imbecility
Intelligence Officials Eye Blogs for Tips
They Done Found Us Out, Cletus: Intrepid Internet Detective Figures Out Our Master Plan
Shock: Josh Marshall Almost Mentions Sarin Discovery in Iraq
Leather-Clad Biker Freaks Terrorize Australian Town
When Clinton Was President, Torture Was Cool
What Wonkette Means When She Explains What Tina Brown Means
Wonkette's Stand-Up Act
Wankette HQ Gay-Rumors Du Jour
Here's What's Bugging Me: Goose and Slider
My Own Micah Wright Style Confession of Dishonesty
Outraged "Conservatives" React to the FMA
An On-Line Impression of Dennis Miller Having Sex with a Kodiak Bear
The Story the Rightwing Media Refuses to Report!
Our Lunch with David "Glengarry Glen Ross" Mamet
The House of Love: Paul Krugman
A Michael Moore Mystery (TM)
The Dowd-O-Matic!
Liberal Consistency and Other Myths
Kepler's Laws of Liberal Media Bias
John Kerry-- The Splunge! Candidate
"Divisive" Politics & "Attacks on Patriotism" (very long)
The Donkey ("The Raven" parody)
News/Chat
Archives
Powered by
Movable Type 2.64