Tax Analysts Blog

Tuesday, October 19, 2010
Economists Carmen Reinhart and Kenneth Rogoff have written several papers and a book reporting on their research that gross public debt in excess of 90 percent of GDP severely hinders economic growth--perhaps by more than one percentage point per year. Separate research by Caner, Grennes, and Koehl...
Monday, October 18, 2010
Americans are overweight and so is their government. The diet plans are proliferating. Here are some of the latest. The Bowles Diet. I shall weigh 180 pounds for my whole adult life. Erskine Bowles is the Democratic co-chairman of the President's deficit reduction panel (scheduled to release its fi...
Friday, October 15, 2010
Economists at Congressional Budget Office are doing their best to educate their bosses about the dangers of rising government debt. In a recent report they warn that debt crowds out private capital formation, that it increases the likelihood of inflation, that it increases the possibility of a fisc...
Wednesday, October 13, 2010
In today's Wall Street Journal Sen. Jon Kyl of Arizona offers his cure for joblessness ("A Growth Agenda for America"). After the now-familiar Republican rants about the failure of Keynesian economics (at odds with what most economists think) and the need to reduce the size of government (but witho...
Tuesday, October 12, 2010
Raise the social security retirement age and start scaling back benefits for high-income recipients. That’s impossible. Put a lid on Medicare and Medicaid spending that is growing faster than anything in the economy. That’s impossible. Scale back the size of the military and end the U.S. role as...
Wednesday, October 6, 2010
In today's Washington Post Steven Pearlstein puts the spotlight on rising income inequality. The main source of his information is a new study using new data through 2008. More recent data are not yet available but it's a safe bet that the distance between rich and poor has only increased since the...
Tuesday, October 5, 2010
With newly released estimates of the bailout of Anglo Irish Bank the Irish government is staring down the barrel of a budget deficit equal to a whopping 32 percent of GDP. Ireland does not want a Greek-style foreign bailout and it does not want to default or restructure its own sovereign debt or th...
Monday, October 4, 2010
In a recent post we talked about the best kept secret in Washington: supply-side effects of debt-financed tax cuts are negative. To back this up we cited a just-released CBO study and 2003 report from the Joint Committee on Taxation. Here's some additional supporting research: (1) In a 2002 article...
Friday, October 1, 2010
Nobody talks about balancing the budget anymore. It’s a nice clear-cut idea. But it's so far off the charts you would be called a lunatic for even making the suggestion. It can be a goal but it can never be portrayed as a viable policy outcome. It is like talking about zero tolerance for drugs. We...
Thursday, September 30, 2010
In the mainstream media and on Capitol Hill it is accepted as gospel that tax cuts are always good for the economy. (That's why the title to this blog post is so grating.) But it simply ain't so. In a May 2003 report requested by Republicans, the Joint Committee on Taxation estimated that the long-...
Tuesday, September 7, 2010
Reports are just coming in (here and here) that Obama will propose that businesses be allowed to write-off the entire cost of investment in plant and equipment in the year it is placed into service. The provision will be in effect from the date of announcement until the end of 2011. Also being prop...
Monday, August 9, 2010
Here is the formula: Somebody in the Obama Administration once said X. This reveals the true nature of the Obama agenda to destroy the Constitution and take away our freedom. This is a fundamental threat to our way of life and we should be extremely angry. As bad as this tripe is, it is less gratin...
Monday, July 26, 2010
America's tax system faces two great challenges in the 21st century. It must generate enormous amounts of revenue to prevent the national debt from spiraling out of control, and it must generate that revenue in a manner that will interfere least with the market economy. The nonstop antitax bluster...
Friday, July 23, 2010
I had the privilege of testifying before the Ways and Means Committee yesterday. Below is the text of my oral testimony. The official witness testimony can be found here. And the excellent pamphlet by Joint Committee on Taxation is here. Mr. Chairman, Ranking Member Camp, members of the committee:...
Saturday, July 17, 2010
Following up on his campaign promises, President Obama's first two budgets have included a package of tax hikes on multinationals intended to close loopholes and level the playing field between foreign and domestic investment. Among those proposals, the one that is getting the most attention is the...
Monday, July 12, 2010
The biggest tax issue for big business is transfer pricing and various other methods of shifting profits from high-tax countries to low-tax countries. For the U.S. government this has resulted in huge revenue losses. Estimates vary between $30 billion and $60 billion annually. For multinationals th...
Thursday, July 1, 2010
Yesterday there was another meeting of the President's deficit reduction panel. Murdoch's unabashedly biased Wall Street Journal took the opportunity to spin the non-event into a story of its liking ("Deficit Panel Stresses Spending Cuts") . At the meeting there was a lot of self-congratulatory but...
Wednesday, June 16, 2010
Deepwater drilling can lead to monumental disaster. That our business and government experts did not fully comprehend that is a sure sign that our vital domestic oil and gas industry is broken. The catastrophe in the Gulf of Mexico has exposed how too much cost cutting and too little oversight can...
Friday, April 2, 2010
A few years ago Congress gave a subsidy and a tax break for companies that provide prescription drug benefits to retirees. To help reduce the costs of health care reform Congress repealed the tax break. The estimated impact of this provision is about $500 million a year once it takes effect in 2013...
Thursday, February 25, 2010
The President has issued an executive order that calls for an 18-member bipartisan commission to offer a plan to cut the deficit 3 percent of GDP by 2015. How hard will it be to reach this target? To answer this question we first need to know to what we are comparing the proposal. In other words, w...