Reader rjs sends us several links:
Washington ‘Spends’ More on Tax Breaks Than on Medicare, Defense, or Social Security – Tax expenditures are funny, They’re not taxes, exactly, because they save us money. They’re not spending, exactly, because the dollars are never actually spent. They’re somewhere in between. So think of it as tax spending. Or just think of it as the ultimate nudge. The carrot hiding behind the tax code’s big stick, tax spending guides us by making certain behaviors and actions cheaper. We encourage employers to provide health care by taxing wages and not taxing health benefits. We encourage investing by making a dollar earned from dividends cheaper than a dollar earned from a salary. And as the CBO reports in a new study today, Washington’s tax spending budget — comprised of everything from mortgage deductions to the child tax credit to lower tax rates on capital gains — is so massive, it’s technically larger than Medicare, Defense, or Social Security. The tax spending budget is equal to 1/17th of the US economy.
Your Humble Blogger Speaks on the Melissa Harris-Perry Show About Apple’s Senate Hearing, Corporate Tax Avoidance – Yves Smith – We appeared on the Melissa Harris-Perry show on Saturday to participate in a discussion of the Senate Permanent Subcommittee on Investigations hearing on Apple’s astonishingly low tax payments. This was a lively discussion and I had to push a bit to get my comments in. The discussion was in two segments. I believe if you watch the first clip, it will roll into the second, but in case not, I’ve included the second one as well.
Reasoning by Metaphor – We don’t make policy in this country based on our knowledge of the likely outcomes; instead we limit our actions to those possible in an age dominated by gut feelings and the irrational demands of the rich, driven by faulty reasoning. This week we see several examples of disrespect for knowledge and reasoning. On the more or less left, we have the spectacle of Michael Kinsley, currently an editor at large at The New Republic, exploring the Puritan within himself: Krugman also is on to something when he talks about paying a price for past sins. I don’t think suffering is good, but I do believe that we have to pay a price for past sins, and the longer we put it off, the higher the price will be. And future sufferers are not necessarily different people than the past and present sinners. I think that last sentence means that it is a least possible that the people who caused the Great Crash might suffer now or in the future, Kinsley’s nod at the unfairness of his solution. Matt Taibbi points out that our national debate is all about how government is just like a household that has run up too much debt, a stupid metaphor. It completely ignores all the ways that governments and households are radically different, not least of which is that governments don’t die. People use that metaphor to frame their thinking about how to cope with continuing federal deficits, and come up with answers that lead to austerity and the Republican refusal to raise the debt ceiling. The error in both cases comes from reasoning with a metaphor. Kinsley talks about a “we” who did bad things with money and the economy. By we, he means society. Then he uses individuals as a metaphor for society. If you commit a sin, you should be punished. If society commits a sin, it should be punished. This reasoning is identical to the reasoning from the household metaphor.