As procrastinators across the country furtively shuffle W-2’s under their desks while on conference calls and google “post office hours,” Natalie Angier points out that humans aren’t the only ones expected to contribute to their society. In fact, dominant male fairy wrens may punish delinquent citizens for up to 26 hours and vampire bats actually regurgitate meals to feed hungry . . .
Looking for a 22,000 percent return on your investment? Hire a lobbyist, send her to Washington on your behalf, and watch the money roll in. A recent study out of the University of Kansas found that every $1 spent by firms lobbying Congress for a single tax break in 2004 brought in $220 in tax savings. (HT: Marginal Revolution) [%comments]
| Reason.com offers a nationwide roundup on (mostly stillborn) efforts at the state level to levy a sin tax on video games. Some proposals aim to tax only violent games (who knows it if would affect the forthcoming adaptation of Dante’s Inferno, in which sinners are the exclusive targets of horrific violence). Seriously, though, one can see the populist appeal . . .
The new tax hike on tobacco products went into effect yesterday. There are few better examples for Econ 1, and the players involved clearly understand the issues. For cigars, my smoke of choice, the tax on good domestically produced cigars rises from 5 to 40 cents. “Many of our rollers are worried,” Hector Ventura, operations manager for El Credito, told . . .
Photo: hoggardb The Internal Revenue Service presumably never likes tax cheats, but when money is tight there is more pressure put on the I.R.S. to step up enforcement and collect more money. The most recent gambit, reported today, is an amnesty program designed to root out offshore tax havens. We once wrote of another I.R.S. measure that produced $3 billion . . .
| By two votes, the British Medical Association (BMA) has rejected a motion calling for a sin tax on chocolate in the United Kingdom. Dr. David Walker, of Lanarkshire, Scotland, says the treat poses at least as much a threat to health as alcohol does in the U.K., and should be taxed accordingly. “Obesity is a mushrooming problem. We are . . .
Like Greg Mankiw, I think it’s a no-brainer that we should raise the gas tax. But it’s incredibly difficult to muster the political will to impose a traditional tax. (Witness California’s inability to increase the state gas tax by a measly 12 cents.) Last year, Robert Samuelson (and a host of others) proposed a contingent tax that only kicks in . . .
Between 1990 and 2005, the wage gap between the 95th and 90th percentiles of the earnings distribution rose as rapidly as between the 90th and the 50th. The rise between the 98th and the 95th was also very large (and data limitations prevent going much beyond the 98th). Thus I applauded President Obama‘s campaign promise, and budget proposal, to raise . . .
As the Senate and the House look to reconcile competing stimulus plans, the big debate is whether to emphasize government spending or tax cuts. A new paper by the New York Fed’s Gauti Eggertsson argues that the risk of deflation should tilt the balance to government spending. Our current problem is deficient aggregate demand. The government can raise total spending . . .
Over the past few months, the press has deluged Americans with weepy stories about people who are in danger of losing their houses because their sub-prime mortgages now exceed the value of their houses, which the recession and the popping of housing bubbles have caused to drop. I am sympathetic; and I, and other taxpayers, am being asked to provide . . .
So today is a two-fer: both Tom Daschle and Nancy Killefer will not be joining the Obama administration, as planned, as Health and Human Services secretary and chief performance officer, respectively. They were both undone by failure to pay taxes.
The Wall Street Journal recently published a front-page story about the estate tax. Under current law (passed in 2001), the tax is scheduled to disappear next year (but come back with a very low exemption in 2011). President-elect Obama will quickly push to abolish the repeal and instead freeze the exemption at $7 million for a couple, with a marginal . . .
… you can show them this chart, courtesy of the Congressional Budget Office, via Greg Mankiw: Lowest quintile: 4.3 percent Second quintile: 9.9 percent Middle quintile: 14.2 percent Fourth quintile: 17.4 percent Percentiles 81-90: 20.3 percent Percentiles 91-95: 22.4 percent Percentiles 96-99: 25.7 percent Percentiles 99.0-99.5: 29.7 percent Percentiles 99.5-99.9: 31.2 percent Percentiles 99.9-99.99: 32.1 percent Top 0.01 Percentile: 31.5 . . .
Anyone who pays short-run capital gains tax this year is either really lucky or really dumb.
It would seem to be a fantastic time to raise gas taxes right now: while the economic climate is so dire that all other tax hikes have been shelved (even the high-earner income-tax increase that Obama pushed during his campaign), gas prices have fallen so far in recent weeks that even an outrageously high per-gallon tax wouldn’t hurt much right now. (It’d be kind of like a SMarT Plan in reverse.) But as with all tax matters, things aren’t so simple.
Continuing his push for a gas-tax holiday, Sen. John McCain told a town-hall session last week that he “trust[s] the people and not the so-called economists to give the American people a little relief.” So who do “the people” trust to give them economic relief? By a margin of 50 percent to 44 percent, it’s Sen. Barack Obama, according to . . .
As the average price of gasoline nationwide topped $4 a gallon this week, Sen. John McCain said he would renew his call for a summer gas tax holiday. The idea was roundly panned by economists (including the ones on this blog) when McCain and Sen. Hillary Clinton first raised it in May. This time around, McCain says he won’t “pretend . . .
Screen Shot from the Marketplace Web site. It’s next to impossible to find an economist who will support a gas tax holiday, but cutting the gas tax altogether is an option in Budget Hero, a surprisingly entertaining online game that puts you in charge of balancing the federal budget. Based on budget models from the Congressional Budget Office, Budget Hero . . .
A California state assemblyman has proposed dealing with the state’s huge budget shortfall by taxing pornography, including the production and sale of pornographic videos — by 25 percent. To an economist this initially sounds like a good idea: An ideal tax is one that doesn’t cause any change in behavior — doesn’t generate any excess burden on the economy. I . . .
I’m struck to find that we pointy-headed economists have become a symbol in the presidential campaign. No, not evil trickle-down, right-wing economists who manufacture an uncaring government, or lunatic left-wing, regulate-em-all central planners who want to destroy innovation — but all economists. Last week I issued a challenge to find a coherent economist who would support the gas tax holiday . . .
Last week I posed a simple challenge: Try to find any coherent economist willing to support the gas tax holiday proposed by candidates McCain and Clinton. The challenge remains unanswered, but here’s some interesting commentary collected during the week: 1. George Stephanopoulos posed my challenge directly to Senator Clinton (video here), asking: “Can you name one economist — a credible . . .
This week many of you will receive tax rebate checks from the I.R.S. Yes, that $600 you are receiving is meant to help kick start the economy. The government tried the same thing in 2001, sending out $300 checks. But this time, there’s a difference — not all of us are getting a check. In fact, those earning six figures . . .
Election season is probably the best time for bad economic policies to garner support — and one of the roles of academic economists is to call the candidates out on terrible policy. From yesterday’s New York Times, we learn that: Senator Hillary Rodham Clinton lined up with Senator John McCain, the presumptive Republican nominee for president, in endorsing a plan . . .
With more than $110 billion in tax rebates set to flow into taxpayer pockets starting today, everyone from big-box retailers to restaurants to debt-collection agencies is vying for a piece of the action. But what’s the smartest way to spend your rebate — for yourself and for the larger economy? Now that we’ve considered that, how are you really going . . .
In some cases, both rely on the honor system to collect their revenue. During tax season, New York State asks its citizens to voluntarily pay sales tax on any untaxed internet purchases they have made over last year. The plea has been pretty effective — New Yorkers handed over $45 million in internet sales tax last year alone. Still, that’s . . .
If you are a parent who’s trying to save for your kids’ college education, you should check out Jane Kim‘s article in the Wall Street Journal about 529 college-savings plans. If you don’t know what a 529 plan is, you should; and if you do, Kim’s article is helpful in assessing whether you’re optimizing your participation. In a nutshell: a . . .
Tucked into a Times report about a typically out-of-touch New York State budget crafted by the wizards of Albany comes this news: Another $50 million [of state revenue] will come from requiring online retailers like Amazon that do not have a physical presence in New York to collect sales taxes on purchases made by New Yorkers and remit them to . . .
A few days ago, New York’s State Senate passed a bill making it illegal to recruit someone into a street gang. In the never-ending fight by city officials and legislators to combat gangs, this is one of the latest efforts to outmaneuver gang members. Other similar initiatives have included: city ordinances that limit two or more gang members from hanging . . .
On a wintry night a few weeks ago, I was walking with Aaron Edlin across the Harvard campus when he casually claimed that the “voter’s paradox” wasn’t generally true — that it could be rational for people to vote for purely instrumental reasons. I did a double take, because the chance that my vote will change the result of any . . .
Personal unhappiness may boost spending. New Web site lets users create their own carbon tax. (Earlier) Artificial sweeteners may cause more weight gain than sugar. (Earlier) Does all corporate culture have to be evil?