In The WSJ, Art Laffer explains that tax compliance adds an additional 30% to the cost of federal taxes and advocates a flat tax to reduce complexity.
At NRO, Kevin Williamson reports that repealing the Bush tax cuts for higher earners would raise $80 billion per year, in the context of a $1.6 trillion annual deficit.
The Journal editorializes that raising taxes on the rich will have a modest impact on the budget.
Consider the Internal Revenue Service’s income tax statistics for 2008, the latest year for which data are available. The top 1% of taxpayers—those with salaries, dividends and capital gains roughly above about $380,000—paid 38% of taxes. But assume that tax policy confiscated all the taxable income of all the “millionaires and billionaires” Mr. Obama singled out. That yields merely about $938 billion, which is sand on the beach amid the $4 trillion White House budget, a $1.65 trillion deficit, and spending at 25% as a share of the economy, a post-World War II record.
On TNR, Jonathan Chait counters Laffer with the claim that lower tax rates are not necessary to lower compliance costs.
From The WSJ, James Taranto skewers Walter Mondale’s call for higher tax rates.
Cato’s Alan Reynolds discusses tax rates on the Tara Servatius radio show.
At Econlog, David Henderson critiques one aspect of David Cay Johnston’s recent attack on supply-side economics.
But if he wanted to inform the reader without misleading, he would have presented the data on the percent of all federal taxes paid by the top 1 percent. In their book, Public Finance, 9th edition, Harvey S. Rosen and Ted Gayer, give a table showing that in 2005 [and things haven’t changed much since then] the top one percent paid 27.6 percent of all federal taxes.
At COAL, Paul Krugman suggests the US can comfortably handle tax rates that absorb 23 percent of GDP, up from the historical 18.3 percent average.
On RCM, Joe Calhoun wonders if commodities have reached their top.
At Asia Times, David Goldman suggests the economy may lapse back to deflation. More on the theme, here.