February 11, 2008 by Tom Armstrong.

Just-released Economic Report of the President. I don’t read the whole thing, just the section on taxes. Here’s an example in the report:

The cost from tax distortions can be considerable. One recent study
suggests that raising an additional dollar of revenue from the individual
income tax costs the economy approximately 30 to 50 cents. That is, if taxes
increase by $1, taxpayers bear a cost of $1.30 to $1.50 – the $1 in revenue and
30 to 50 cents from accompanying distortions. This additional cost of 30-50
cents is known as deadweight loss. Any government services that are funded
with this revenue would have to have a benefit to society of at least $1.30 to
justify the increase in taxes.

If you don’t know what a deadweight loss refers to, see this or this.

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February 11, 2008 by Tom Armstrong.

A list of national marginal tax rates since 1913, the beginning of the federal income tax.

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February 11, 2008 by Tom Armstrong.

Suppose I tell you that the government will design a product and make you buy it. If you say no thanks, that’s too bad. The government will decide what you need and what you will buy.

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February 11, 2008 by Tom Armstrong.

An opinion on how to short equities.

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February 11, 2008 by Tom Armstrong.

I only like to post the articles and posts that most speak to me; only about 5% to 10% of what I read ever gets posted here. I most enjoyed these articles this morning:

Criminalizing Capitalism Sample (the government “solutions” at the end are terrible, but interesting, nonetheless):

Yet Enron was actually an example of how markets work—messily, sometimes tardily, but in the end with ruthless efficiency. Even as most Wall Street analysts bought Enron’s sales pitch and accepted its financial statements, investors slashed the value of the company’s shares in half—far surpassing declines in the broader market—during the year before the accounting scandal broke. Investors had begun to withhold money before the government launched investigations. When Enron declared bankruptcy in December 2001, the regulators were left only to certify the market’s verdict. Those investors and lenders who hadn’t scrutinized the company lost money, as they should have.

This article by Cox and Alm is also worth reading.

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