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Writing in the Wall Street Journal, Hank Adler and Lacy Willis express their hope that in the upcoming case of Moore v. U.S. the U.S. Supreme Court will clearly and reasonably define “income.” Two slices:

The Supreme Court hears oral arguments Tuesday in the most important tax case in decades. Moore v. U.S. will answer the question of whether Congress can tax unrealized capital gains as if they were income under the 16th Amendment.


The case before the justices is straightforward. In 2006, Charles and Kathleen Moore invested $40,000 in a 11% equity interest in a foreign corporation. Between 2006 and 2017, the company was profitable but reinvested all its earnings in the business. The Moores thus didn’t receive dividends or any other income from the investment.

Under the Tax Cuts and Jobs Act of 2017, however, the Moores became subject to a new federal levy called the “mandatory repatriation tax,” applicable to investors in overseas corporations. The new tax treated their allocable share of the corporation’s undistributed earnings as if they were actually received by the shareholders. The tax was retroactive, covering the entire period beginning with the Moores’ initial investment through 2017. The rate of tax was unusual. Instead of a statutory rate, it was a floating rate that varied according to the balance-sheet liquidity of the corporation.

The legal problem is how any of this could qualify as a tax on income. The federal income tax is constitutional, but a constitutional amendment was needed to make it so. The Constitution requires that any direct tax levied by the federal government be apportioned according to each state’s population, so that the per capita tax is the same in all 50 states. Income taxes couldn’t fit that description, so the 16th Amendment was necessary to allow taxing of individual income.

In 2018, long before we heard of the Moores, we noted the unconstitutionality of the mandatory repatriation tax in an essay titled “The Worst Statutory Precedent in Over 100 Years.” We argued that it isn’t a tax on income and therefore is an unconstitutional direct tax. We questioned whether Congress could tax the undistributed earnings of a corporation retroactively to 1986, which is what the law did. We noted that the rate was based on liquidity, making it not an income tax but a balance-sheet tax.

The Wall Street Journal‘s Editorial Board reports on yet further evidence of the costliness to Americans of Trump’s tariffs. A slice:

New data from Harbor Aluminum, produced for the Beer Institute, shows how these costs have continued to climb. Mr. Trump imposed 10% tariffs on aluminum imports in March 2018, citing dubious national-security concerns. Through September 2023, the U.S. beverage industry paid nearly $2.2 billion in tariff costs, according to the report.

GMU Econ alum Paul Mueller continues his critical assessment of ESG ‘investing.’

J.D. Tuccille is correct: Even hateful speech is protected by the First Amendment. A slice:

When free-speech rights are respected and protected, they’re available for everybody to use out in the open. If one side is suppressed, its supporters may not be able to publicly air their views, but they still hold them and share them in private—and may feel that much more justified because of state action.

Open, loud, and peaceful speech—no matter how objectionable—is far preferable to the alternative. The killing of Paul Kessler in California and the shootings of Kinnan Abdalhamid, Tahseen Ali Ahmad, and Hisham Awartani in Vermont remind us that there are far worse forms of expressing strongly held sentiments than harsh words.

My GMU Econ colleague Bryan Caplan recommends going cold turkey on the news. A slice:

Once you understand this, the rational way to consume news is to constantly ask yourself questions like: “In a well-functioning society of 8 billion people, how much bad stuff would be reported anyway?” I never sympathized with BLM, but when I learned that the total number of unarmed blacks fatally shot by U.S. police in 2019 was 14, even I was astounded by BLM innumeracy. Hundreds of kids drown in U.S. swimming pools every year, but there will never be riots about that. Nor should there be.

[DBx: Many years ago I stopped – completely – watching news and news-type programming on television. It was and remains for me a very good move. My news consumption now comes chiefly from reading newspapers on-line and listening each day, only when driving around town, to a few minutes of WTOP.]

David Henderson warns that the green religion is making the renting of automobiles more difficult…. And Kenneth Costello reasons that the fate of EVs should be decided by the market and not government.

My intrepid Mercatus Center colleague, Veronique de Rugy, is not impressed with Thomas Piketty’s defense of his work against the powerful findings of Gerald Auten and David Splinter. A slice:

Never mind that saying inequality isn’t soaring isn’t the same as saying that inequality doesn’t exist. Never mind either that those in favor of the welfare state should be happy to get confirmation that giving money to people lifts their income. That, of course, is a different thing than arguing that this is the best way to achieve that goal. It also doesn’t settle questions such as whether we should be concerned about inequality in the first place.

In any case, Piketty’s response is typical of someone whose work has been unchallenged for years because his message made sense to many people no matter how sloppy that work has been.