Morning Coffee: Why McCain's Health Reform Plans Frighten Me (August 25, 2008)
Income and Poverty Over the 2000-2007 Business Cycle

To Leave Error Unrefuted Is to Encourage Intellectual Immorality!

Two from Paul Krugman:


Savings delusions: Hmm. Stan Collender praises Tyler Cowen for his insight that “people” have been treating capital gains as saving, setting us up for the current mess. But it wasn’t just “people”: the assertion that all’s well thanks to capital gains has been a staple argument of conservative economic commentators, notably David Malpass; in fact, it’s an argument that pops up every couple of months on the WSJ editorial page. So this isn’t a delusion of the great unwashed; it’s a doctrine, one that has played a big role in conservative thinking.


The Tax Foundation is not a reliable source: Greg Mankiw [vs] Everyone who did a little fact-checking.

Here is the link to Mark Thoma:

Economist's View: "The Greek Menace": First, Paul Krugman:

There’s a lot to say about this stuff, but right now I’d just like to mention one aspect. The Tax Foundation people start off with a graph that’s supposed to be terrifying, with the headline “Europe cuts rates while U.S. stands still”; the graph shows European tax rates dropping far below the US rate.... [T]hey don’t explain how they calculate the “average” tax rate, the fact that their own data show that all the big economies have tax rates above 30%, while their graph shows an average rate of about 27%, seems to indicated that they’re showing us an unweighted average — that is, one that makes small economies like Ireland and Greece seem as important as big economies like Japan and Germany. And whaddya know, corporate taxes in big economies tend to be similar to those in the United States, a point made by the Congressional Budget Office in the study from which the chart above is drawn...

Next, from Linda Beale:

Tax Foundation and Competitive Environments: more bunk!, by ataxingmatter: As a result, the US is actually a corporate tax haven, with the lowest effective corporate tax rates of almost all the countries that participate in the OECD. That's a little fact that the Tax Foundation apparently doesn't want the American public to understand, since all its hype is in terms of statutory rates and not in terms of effective tax rates...

As Dean Baker notes, the Washington Post has been pushing the same line:

Washington Post Misleads Readers to Push for Lower Corporate Tax Rates, Beat the Press: The Washington Post editorial page has no qualms about making up data to further its agenda. ... Most newspapers might feel embarrassment about using such a blatant misrepresentation to push its preferred policies, but not the Post. Today, the preferred policy is further reductions in corporate income taxes. To advance this agenda the Post tells readers that, "U.S. companies operating abroad already labor under a bigger tax burden than most foreign competitors." That's not what the OECD says. Data from the OECD show that in the average member country corporate taxes are equal to about 3.5 percent of GDP. In the United States, corporate taxes have generally been between and 1.5 percent and 2.5 percent of GDP over the last two decades, according to the Congressional Budget Office (Table F-4)...