I think on the average social programs decrease our standard of living,
How can you possible say that without working through the details? What you have stated is equivalent, in AGW terms, to the original work by John Tyndall, who figured out that CO2 could have an effect on the earth's temperature.
No, I never made any statement that vaguely implied "on the average social programs decrease our standard of living" had the same sort of or level of evidence that the idea that "CO2 could have an effect on the earth's temperature" does.
I said the basics are solid in that way. "The basics" are things like "higher prices encourage supply and discourage demand", not "the net effect of program X is to have this impact on measure Y, and that impact on measure Z"
You have to do a very detailed accounting of who the money is coming from (richer people) how they would spend it, how those who got the money spent it instead, and also look at such diverse things as crime and the cost of police, etc.
No you don't have to. In fact to a great extent you can't. The economy is a very complex and ever shifting thing. It can't be calculated out ahead of time or even, to a sufficient degree to solidly prove that type of statement, in hindsight, at least not unless the difference is vast.
Also standard of living is actually a somewhat subjective term. Sure you can take your subjective definition, and express it in some concrete mathematical way, and do all sorts of studies on it, but your starting with a subjective definition, and then trying to isolate one variable from millions of factors, many of which you (even if you are a brilliant economic researcher) you might not even realize are factors.
I happen to live in Oregon, which has had one of the highest minimum wages now for a few years. My town is a small ag based area, so minimum wage increases directly affect most employers and many employees. What happened is that the Hispanic ag workers very noticeably improved their lifestyle, and AFAIK, no farmers went out of business as a result.
The market clearing wage is hard to calculate precisely and shifts constantly, but if you force wages much higher than it you either create unemployment, or drive unemployment off the books or both. That holds for farmers hiring on the books farm workers in Oregon as well. If Oregon's current minimum wage isn't enough to cause an unemployment problem than $100/hour would be. The idea that forcing too high of wages causes unemployment (and pushed employment off the books) is very solid (up there with "CO2 is a greenhouse gas"), but how much is too much changes all the time, and often isn't known even in hindsight. This can cause some problems even with free market wages, because if the wage goes too high, there can be some stickyness in getting lower wages, which can cause unemployment. But when you have a mandatory minimum you get a much harder barrier to lower wages rather than firing people or having them work off the books.
Even if the forced minimum wage isn't so high as to cause massive immediate obvious problems, it still exerts some level of pressure to reduce employment. At very low levels that pressure get easily get swamped by all the other factors. At somewhat higher levels it has more effect, but still may not be noticed (even to the extent of a single person being laid off) if the sample your observing is sufficiently small (say on the books agricultural workers in the area around one Oregon town). Esp. if the market is moving in such a way that is positive for the producers and their employers.
Generally tax decreases and tax simplification will help the economy and people's standards of living while increases and added complexity will do the opposite.
Again, you lack the details. Tax decreases to what point, zero?
I "lack the details" because I'm making general statements. I'm making a post on SI, not publishing a long economics research paper or a book. And even if I was publishing a book or paper, and was a Nobel prize winning economist, the exact details wouldn't be nearly as solid as the general statement.
Zero tax, tends to be a bad thing, because it implies either
1 - Anarchy, or 2 - A government that runs off the profit of owning the means of production in a socialist system (by which I'm not only referring to totally socialist systems, but things like an small emirate owning the oil and controlling its extraction for profit). Anarchy is generally a bad thing (it might be better than the worst of all possible governments, but few would support it over any decent government, and I am not one of those few). Government's that live off of socialism and extraction tend to not be the best examples of government.
Beyond just the minimum need to avoid anarchy (keeping the peace, enforcing law, protecting borders) there are clearly certain things that are hard to provide in a private market and that serve as a basic infrastructure for private markets of goods and services to thrive. One example (but not the only one) is a road system (roads can be constructed and maintained for profits from tolls, but even if this was a more common way of doing things, it wouldn't work well for the whole road network, only high volume limited access highways).
So no, obviously 0% tax isn't going to work well. When I speak of "generally" I speak of the real world. Countries don't generally have no taxes, they might have rates more like 20 to 80% (with more for political subdivisions within the countries) as a top rate, and maybe somewhere around a quarter to 2/3rds of that rate as the percentage of the GDP taken up by or controlled directly by the government. More specifically I'm focusing on the modern US (although my statement doesn't just apply to the US). Tax cuts to zero percent aren't on anyone's agenda.
So, tax decreases when the rate is "high" are positive, but if the rate is "low" the sign changes.
Not necessarily, its just that the exact benefit (even the sign of it) is less clear when the taxes are low.
The borrowing is less distorting than raising the same money thought our complex tax laws, but if you borrow you create pressure for future tax increases.
Again, that makes no sense. If you actually think that is correct, should the government not tax at all, but just borrow?
No, and I stated (and you quoted) one of the reasons why. Borrow now, and you have to tax later (or you can inflate the debt away if you control the currency supply that causes even worse problems). In addition to that borrowing past a certain point will decrease confidence in the government's ability to repay the debt. At first you just get higher interest rates for this debt. Then higher and still higher rates. Push things to a crazy extent and you can reach a point where you can offer any interest rate you want and no one will lend to you. (Which is particularly likely if you really have zero taxes or other revenue streams, then your stuck with paying back debt solely from future borrowing, or basically a ponzi scheme).
That goes more to the heart of the divide in monetary policy. Should your money be worth more over time, or less, and why so?
Well just about no one believes your money should be worth more over time, supporting that statement is the same as supporting deflation which has next to zero support.
Its more like should it be stable (aim for zero inflation) or should it slowly loose value (aim for low inflation).
Some would have a sort of in between position where zero inflation would be the theoretical ideal, but since they believe it can't be properly targeted and they don't want deflation they aim for low inflation say a percent or two.
Others consider the stickiness of wages to be a more important factor, and would look at very low inflation to be the actual ideal (and then in practice might aim for slightly higher inflation, maybe two or two and a half percent)
And then a minority would really aim for zero inflation, not just as a theoretical ideal, but as their plan for actual monetary policy. Most of these people would want the money backed by something (usually gold). |
