The free-lunch supply-side crowd is crowing over how certain Eastern European nations, including Slovakia, have been growing rapidly allegedly as a result of a move to a flat tax. Witness the comments from President Bush: Thank you, Mr. Prime Minister. I’m thrilled to be here. I have really been looking forward to this trip to […]

Would privatizing Social Security have any effects on national security? While Robert Barro has used his Ricardian Equivalence logic to say no, Brad DeLong objects when Greg Mankiw also claims there is no effect. Brad explains why he disagrees with Mankiw’s WSJ oped and documents why even Dr. Mankiw might disagree with Barro’s proposition. After […]

Greenspan first calls for cutting Social Security benefits, which would mean part of that 12.4% payroll contribution would become a pure and simple backdoor employment tax increase. Now Greenspan calls for lower taxes on capital income as he endorses a consumption tax. Is Dr. Greenspan trying to claim incentive effects on apply to taxes on […]

The BLS has revised its estimates of fourth quarter productivity growth: The Bureau of Labor Statistics of the U.S. Department of Labor today reported revised fourth-quarter seasonally-adjusted annual rates of productivity change–as measured by output per hour of all persons–and revised annual changes for the full year 2004. In the fourth quarter, productivity increased 3.7 […]

I may have been too hard on Congressman Martin’s Sabo suggestion to increase the interest rate on Treasury bonds in the Social Security trust fund in this post. I realized this as I re-read the brilliant critique of the recommendations of the Bush Social Security commission from Peter Diamond and Peter Orszag. Page 26 of […]

In his NRO oped Daniel J. Mitchell claims it does: VAT might have some theoretically attractive features, but it is a perniciously effective way of raising revenues and inevitably leads to bigger government. The best evidence comes from Europe. Back in the mid-1960s, the burden of government in Europe wasn’t that much higher than it […]

Via Duncan Black comes the latest in hypocrisy from the GOP House leadership in what Duncan calls a cute trick with “There is Plan and No Plan” being Duncan’s perfect title. I guess the GOP spin is that they have laid out what the problem is and the broad parameters of how to fix the […]

Without a shred of evidence or theoretical justification, Greenspan said this today on Capitol Hill: “Addressing the government’s own imbalances will require scrutiny of both spending and taxes. However, tax increases of sufficient dimension to deal with our looming fiscal problems arguably pose significant risks to economic growth and the revenue base. The exact magnitude […]

Samuelson opines about the state of interest rates in the US in today’s Washington Post : The Mystery of Low Interest Rates Something strange happened on the way to higher interest rates: They declined. We’re talking about rates on long-term mortgages and bonds. These rates truly affect the economy, because they influence housing and business […]

Yesterday the Office of Federal Housing Enterprise Oversight (OFHEO) released its quarterly estimate of house price appreciation. The estimate shows that housing price appreciation slowed sharply in the fourth quarter of 2004 compared to the third quarter. Because prices rose so much earlier in 2004, the year-on-year (y-o-y) percent change in house prices was still […]