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104 sats \ 18 replies \ @Undisciplined OP 8 Aug \ parent \ on: Why not eliminate taxes on all income? econ
The stimulus plans they come up with are often of roughly the same size as income tax receipts, so it wouldn't be much worse than that financially. Unlike those plans, though, it would actually help ordinary people.
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Of course. This exercise is just for fun. Although, maybe someday we'll get our own Milei type madman and some of this stuff will actually happen.
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May the Forces of Heaven be with you
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Are there financial stimuli every year?
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No, I was just giving a sense of scale.
Keynesian stimulus is not good for economic health, though, which tax cuts are.
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Got it! So, if they get rid of that tax, they'd have to find a way to make up for it or just print more money?
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Or a smaller government budget
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That’s certainly my preference
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One of the silver linings of paying interest on debt is that voters can see the gravity of high debt especially debt to GDP ratio.
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I don’t think voters care enough for this to be a silver lining.
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Only about a third of government financing is from income taxes anyway. Some of the deficit would be made up for by other tax revenues increasing, which would happen because of the sharp increase in economic activity.
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Payroll taxes
How significant is capital gains tax?
Medicare and Social Security are the two largest outlays
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I think capital gains taxes only bring in about $200B.
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I don’t consider tax cuts to be stimulus.
Or economic stimulus is not the reason for cutting or eliminating income taxes
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No, but that’s how macro people think. I think of it as a cessation of systemic expropriation.
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Macro people think is Orwellian newspeak
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It really is
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Macro thinking requires macro assumptions
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