Bruce Yandle argues that “antitrust cops should be going after Medicare, not Google.” A slice:
Unlike Google, with Medicare, there is evidence of harm to ordinary people. Taxpayers are certainly victims and eventually, more patients could be, too. The Medicare deficit is growing, and the program’s trust fund is now expected to run out in 2036.
Sixty-six million individuals were enrolled in Medicare last year, when the federal government spent $832 billion on the program, an amount equal to 3.1 percent of GDP and more than four times Google’s ad revenue.
Rep. Ro Khanna is wrong about corporate taxation (“How I Differ With J.D. Vance,” op-ed, Aug. 17). “Massive corporate tax cuts for Apple and General Electric result in stock buybacks and do nothing to encourage investment in Johnstown or Youngstown,” he claims. This familiar bit of rhetoric is devoid of economic reasoning.
A corporation is one way to organize capital. Taxing capital makes capital formation more expensive, and the burden falls on three parties. The first is consumers, who experience higher prices. Owners are second, because they see lower returns. Last are workers, whose wages are depressed when productivity falls.
I wager Rep. Khanna is most concerned about workers. He should know that recent studies find labor bears between 30% and 70% of the costs of corporate income taxes. This is because capital is usually more mobile than labor, as he acknowledges in his laments about a dearth of “investment in Johnstown or Youngstown.”
Mr. Khanna doubtless has the best of intentions. But his argument about corporate taxes is uninformed by the science of scarcity and trade-offs. As a result, he is more likely to hurt the struggling workers he wishes to help.
Prof. Alexander William Salter
Rawls College of Business, Texas Tech
Lubbock, Texas
Price controls cannot solve the problems caused by lax monetary and fiscal policies.
Worse, they interfere with the price signals necessary to coordinate the economic activities of hundreds of millions of people in big societies like Brazil. This reduces economic efficiency, productivity, and production, ultimately lowering the standard of living compared to what it could otherwise be.
The Brazilian experience with price controls lasted less than a year and ended in disgrace, with Sarney’s administration totally discredited. That, however, was not the first time that something like that happened, and as the evidence of 4,000 years demonstrates, it won’t be the last.
Harvard economist Jeffrey Miron asks: “Do family leave policies work?” Here’s his conclusion; it’s one that should, if superficialities are to be believed, play well in this day of Americans’ renewed love of freedom:
One alternative is to leave decisions about career and child-rearing to women and their families, with no government thumb on the scale!
Liz Wolfe thanks the almighty that the Democratic national convention is over. [DBx: I sincerely admire my fellow classical liberals who can stand to watch such events – Democratic or GOP. I have too weak a constitution to bear beholding these goings-on. I detest having my intelligence insulted, and I get depressed seeing any of my fellow human beings eagerly offering their souls and sous to individuals whose ethical values would bring a blush to the face of Mephistopheles. So I avoid all direct exposure to such depraved and sorry spectacles.]
While we’re on the subject of political conventions, here’s the Wall Street Journal‘s Matthew Hennessey. Two slices:
Mr. Trump may win in November, but for reasons other than his bedside manner. Most Americans know what a rough ride Trump II will bring.
An iron rule of marketing holds that it’s a bad idea to introduce new products in August. Unfortunately for Democrats, they didn’t have a choice. In Chicago this week they tried to pull off a rebranding of their own. Out was the idea that America is a systemically racist bastion of economic inequality. In was the Star-Spangled Banner.
Turns out Kamala Harris “loves her country with all her heart.” Well, blow me down.
…..
Ms. Harris may win, but it won’t be because Democrats told us how much she cares. It will be because she isn’t Donald Trump.
Some lament that politics has become too much like entertainment. Actually, it’s too much like advertising. We all think we’re immune to Madison Avenue techniques, but they work. Pitching voters on the virtues of a particular candidate is like convincing consumers that a sugary soft drink is the key to health and fitness. It’s obviously specious but all that matters is getting to the sale. The lies we tell today will be forgotten by tomorrow.
Yet there are limits to the fantastical claims Americans will believe. You can tell me as many times as you want that Donald Trump reads for fun or that Kamala Harris is a flag-waving patriot. When I feel like retching, I know I’m being spun.
The irony, of course, is that not so long ago, opportunity and freedom used to be a conservative strategy and message. With the advent of the New Right conservatives, not so much. In fact, a central tenet of their message is precisely that freedom and economic growth as the best path to opportunity should be called into question.
We are told that we should instead focus on gauzy abstractions such as “common-good outcomes,” and we should stop believing that keeping America affordable is a good thing. Many on the New Right are demanding that we ignore how much markets have done for us. They want us to ignore the damage inflicted by our inefficient tax code, our punishing regulatory environment, distortive spending, $1.9 trillion deficits, and the 4,392 pages of the Harmonized Tariff Schedule of the United States (per Dominic Pino) so they can claim that the market fundamentalists have been in charge for 40 years.
What’s more, to the extent that these New Right conservatives talk about opportunities, they, like Democrats, mean big-government policies, redistribution, even unions, and subsidies to preferred industries and protection of national champions. Their vision is dark, and their policies, of the past. And it remains to be seen if that it’s good politics.
Please, don’t mistake this post for an endorsement of the VP. It’s not. In fact, to the extent that I can decipher the policies she may want to implement, I can’t stand them.
The worst parts of Vice President Kamala Harris’s economic plan are pretty bad. Like, so bad that her more credible defenders are reduced to arguing that silly proposals such as exempting tips from income tax at least poll well, and maybe when she says “first-ever federal ban on price-gouging on food,” she really just means “robust antitrust enforcement.”
Arnold Kling is correct: “there is no aggregate labor market.”
GMU Econ alum Jon Murphy productively ponders the seen and the unseen.
