The corporate tax is, effectively, a means of taxing people hidden “behind trees,” which is one of its chief attractions to politicians interested in garnering additional tax revenues for the government. They don’t have to admit that the corporate tax is a disguised tax hit on median and low-wage workers and low-income consumers and not on just the rich Trumps, Bill Gates, and Warren Buffets of the world. The exact size of the various hits felt by all income classes are literally unknown and unknowable (although many econometricians feign that their statistical equations reveal truth).
So, if you think it’s too extreme to suggest that opposing international trade is the equivalent of opposing tractor manufacturing in order to protect the oxen industry, I am afraid the federal government has already galloped past you. They say it’s the equivalent of making it illegal to grow your own food during a depression. Except, the federal government makes this reductio ad absurdum in approval of the intuition. And the Supreme Court concurs.
My colleague Pete Boettke and GMU Econ alum Rosolino Candela are inspired by Deirdre McCloskey’s Bourgeois trilogy . (And here’s a link to the entire Winter 2017 issue of the Journal of Private Enterprise – an issue devoted to McCloskey’s trilogy .)
Your next government .
Bob Higgs notices that neoclassical welfare economics is far better at supplying dubious justifications for government intervention than at actually improving our understanding of reality . A slice:
This is the trouble with neoclassical welfare economics, amigos: it’s not a decent theory, but it’s a dandy rationale for government to coerce people right and left ostensibly in order to supply valuable public goods, many of which are mere boondoggles for government contractors and magnets for corruption of the legislators and bureaucrats who impose the projects on an often-unwilling public.