Generally, the policies I explore at Risk & Progress arrive at similar aims. Though I might summarize condense several of these bullet points into one general principle:
Let markets be free until they fail. Where they fail, government should apply the least coercive force necessary to correct it.
Definitely this is New Liberalism. If you imagine Bill Clinton reading this list, basically all the points sound like something he would say. Though I think you're a bit more pro free-trade, anti-paternalist and anti-climate change than he was. The climate change bit is more just because climate change wasn't as big of a deal in the 90s, though.
On the first point, relating to the constraint of special interests’ effect in governance, truly seems to be one of the defining issues of our time.
In the Federalist Papers, it was written that a large pluralist republic would average out special interests to a neutral consensus, not favoring one over the other. However, in reality it seems as if the reality is that special interests will merge into factions of shared interests, and those broad factions will fight with one another.
How do you think we can change the structure of our institutions to limit the influence of special interests?
We need a lobbyist code of ethics. Lobbyists shouldn't be able to donate or direct contributions to candidates they are lobbying. They should also not be able to provide gifts of any kind to politicians or their staffers.
We should dramatically improve in-house government policy research abilities and make a lot of things like the location of military bases and funding support for local infrastructure projects completely outside the hands of Congress.
We can also put topic restrictions on bills and minimum debate thresholds to increase accountability and expand CSPAN to provide a comprehensive, accessible overview of legislation in the process of deliberation. I'm talking infographics, accessible descriptions, etc.
Uncapping the House so the diversity and plurality of the American people can really show. More House members dilute the individual influence of a House member, weaken incumbency advantages, make elections less expensive so House members are less reliant on special interest donors, and allow representatives to be more in contact with their voters rather than special interests. Uncapping the House will allow more parties and policy/issue-based coalitions to emerge and function better.
“Rules must be put in place to curb excessive borrowing in times when there is no recession or ongoing war.”
The proper “rule” is that deficit should not exceed the value of expenditure that meets the NPV>0 criterion where the V is calculated at marginal costs inclusive externalities. Since marginal costs are less than market prices in recession when people, machines and real estate is less than fully employed and discount rates are lower, this rule allows higher deficits during recession as if fiscal policy was doing “Keynesian stimulus.”
Markets do not generate collective wealth. Markets were around for thousands of years with little effect on wealth levels per person. It is *capitalism* that generates wealth.
"We demand more mutually beneficial market transactions between consenting adults that do not create any untaxed/unsubsidized negative/positive externalities (with some exceptions for transactions in addictive substances and services) and for some of the income generated from those mutually beneficial transactions taxed with a progressive consumption taxes and revenues used for redistribution and for purchase of public goods whose expenditures pass an NPV>0 test when inputs and outputs are valued at Pigou tax/subsidy inclusive prices."
I'm still trying to get a proponent of LVT to explain the practical advantages compared to garden variety property tax. Since only property transactions re observed, LVT valuation seems to require an additional step of estimating the value of structures and additions in order to get to the value of the site. Would this be the cost to rebuild the same structure on the site, the cost of rebuilding the currently optimal structure, or some estimate of the actual depreciated value of a structure in current prices?
I'm a bit skeptical of the term "Democratic Capitalism", It's one of these terms that just capitulate to the popular intuition that plane capitalism is inherently elitist, which is a conclusion you can only come up to if you compare it to utopian systems.
I agree on most of these points. Where I differ a bit:
> It’s best when these policies take the form of universal programs that preserve competition and individual choice.
I mostly agree here, but I had the realization that a negative income tax, while in some ways identical to UBI, is substantially more efficient than UBI in any case where taxes with deadweight losses (ie basically all taxes except land value tax) are used to fund it. Since negative income tax basically builds in a calculation of net payout (ie for a given person how much they're taxed minus how much the UBI equivalent is), it means far FAR lower taxes are needed to sustain a negative income tax, with basically 100% of the benefits that UBI has.
> Rules must be put in place to curb excessive borrowing in times when there is no recession or ongoing war.
I would argue that every time the Fed manipulates the market, it makes it harder for markets to correct inefficiencies, raises uncertainty, and generally causes additional havoc. We should not be borrowing during recessions as government spending only deepens the causes of recessions by removing allocation of resources from the free market to central planning.
I think this makes sense when you assume that means testing doesn’t cause dead weight loss.
But my understanding is that means testing is equivalent to a tax, in the sense that it imposes an effective marginal tax rate on earnings and thus like an income taxes, discourages productive activity.
I wrote an article on this. Let me know what you think:
Yes, you have a good point that the tapering in a negative income tax does act like a tax in that it causes similar deadweight losses. I haven't heard that tapering called "means testing" before but I see what you mean. While a negative income tax isn't perfect, its certainly far better than our current welfare system with its myriads of rules and cliffs.
But I do see what you mean that UBI could be more beneficial. If our tax system was based on 100% pigouvian taxes like land value taxation, which don't cause (and actually remove) deadweight losses, then I think you might be right that UBI would be better. If the additional tax revenue needed comes from income taxes and is distributed on the basis of income, then they cancel out and I think both are really identical. But if that money has to come from other taxation methods that cause deadweight losses (like sales tax, or property tax), then it would be better to do a negative income tax.
I think the other issues you brought up either have solutions or don't cause significang problems. Eg loss aversion doesn't really seem likely to impact people's decisions about this, especially once people get used to the tax regime. Loss aversion is more of an in-the-moment decision making quirk of humans, and shouldn't really apply to serious repeated long term decision making.
But interesting to think about when UBI and negative income tax can produce different incentives.
obviously UBI is superior. NIT has a double phase out so it creates progressive marginal tax rates, which cannot be neutral with respect to time, and are more administratively complex.
we want progressive _effective_ tax rates not marginal tax rates.
Progressive marginal tax rates are progressive effective tax rates - you can't have one without the other. And simply repeating that its "obvious" doesn't make you right. Please stop spamming that.
UBI is obviously superior to NIT. NIT is just a bad version of UBI, where you have two phase-out rates, creating progressive marginal tax rates, which are administratively more complex and cannot be neutral with respect to time. super basic econ 101 stuff.
you don't want to take about using any particular tax to fund a given expenditure. that's a fallacy called "hypothecation".
> it means far FAR lower taxes are needed to sustain a negative income tax
this is mathematically incoherent hand word salad.
People who say stuff like that haven't put enough thought into what they're talking about. Everything seems "simple basic obvious 101 even idiots know" if you refuse to think about it deeply. You aren't making a contribution here dude, you're just spamming.
> this is mathematically incoherent hand word salad.
What about "lower taxes are needed" don't you understand? You need to take a step back because you're being obnoxious.
Generally, the policies I explore at Risk & Progress arrive at similar aims. Though I might summarize condense several of these bullet points into one general principle:
Let markets be free until they fail. Where they fail, government should apply the least coercive force necessary to correct it.
Good clarification. It’s not just that the government should address market failures, it’s that it should do a minimally invasive fashion
Definitely this is New Liberalism. If you imagine Bill Clinton reading this list, basically all the points sound like something he would say. Though I think you're a bit more pro free-trade, anti-paternalist and anti-climate change than he was. The climate change bit is more just because climate change wasn't as big of a deal in the 90s, though.
On the first point, relating to the constraint of special interests’ effect in governance, truly seems to be one of the defining issues of our time.
In the Federalist Papers, it was written that a large pluralist republic would average out special interests to a neutral consensus, not favoring one over the other. However, in reality it seems as if the reality is that special interests will merge into factions of shared interests, and those broad factions will fight with one another.
How do you think we can change the structure of our institutions to limit the influence of special interests?
We need a lobbyist code of ethics. Lobbyists shouldn't be able to donate or direct contributions to candidates they are lobbying. They should also not be able to provide gifts of any kind to politicians or their staffers.
We should dramatically improve in-house government policy research abilities and make a lot of things like the location of military bases and funding support for local infrastructure projects completely outside the hands of Congress.
We can also put topic restrictions on bills and minimum debate thresholds to increase accountability and expand CSPAN to provide a comprehensive, accessible overview of legislation in the process of deliberation. I'm talking infographics, accessible descriptions, etc.
Uncapping the House so the diversity and plurality of the American people can really show. More House members dilute the individual influence of a House member, weaken incumbency advantages, make elections less expensive so House members are less reliant on special interest donors, and allow representatives to be more in contact with their voters rather than special interests. Uncapping the House will allow more parties and policy/issue-based coalitions to emerge and function better.
“Rules must be put in place to curb excessive borrowing in times when there is no recession or ongoing war.”
The proper “rule” is that deficit should not exceed the value of expenditure that meets the NPV>0 criterion where the V is calculated at marginal costs inclusive externalities. Since marginal costs are less than market prices in recession when people, machines and real estate is less than fully employed and discount rates are lower, this rule allows higher deficits during recession as if fiscal policy was doing “Keynesian stimulus.”
Markets do not generate collective wealth. Markets were around for thousands of years with little effect on wealth levels per person. It is *capitalism* that generates wealth.
https://mikealexander.substack.com/p/a-take-on-how-the-scientific-revolution
There are different kinds of capitalism. The shareholder primacy type we have now is not as effective as the stakeholder capitalism we used to have.
https://mikealexander.substack.com/p/why-progress-seems-stalled
land value taxes don't "promote development", they just don't _penalize_ pareto improvements. they have no "deadweight loss".
https://clayshentrup.medium.com/land-value-tax-discussion-with-jeremiah-johnson-8469a81cb8b7
My one sentence philosophy is: :)
"We demand more mutually beneficial market transactions between consenting adults that do not create any untaxed/unsubsidized negative/positive externalities (with some exceptions for transactions in addictive substances and services) and for some of the income generated from those mutually beneficial transactions taxed with a progressive consumption taxes and revenues used for redistribution and for purchase of public goods whose expenditures pass an NPV>0 test when inputs and outputs are valued at Pigou tax/subsidy inclusive prices."
I'm still trying to get a proponent of LVT to explain the practical advantages compared to garden variety property tax. Since only property transactions re observed, LVT valuation seems to require an additional step of estimating the value of structures and additions in order to get to the value of the site. Would this be the cost to rebuild the same structure on the site, the cost of rebuilding the currently optimal structure, or some estimate of the actual depreciated value of a structure in current prices?
Will you be the one?
it's incredibly obvious. taxes on buildings create deadweight loss. land value tax doesn't—taxing land doesn't decrease the amount of land. econ 101.
I'm a bit skeptical of the term "Democratic Capitalism", It's one of these terms that just capitulate to the popular intuition that plane capitalism is inherently elitist, which is a conclusion you can only come up to if you compare it to utopian systems.
I agree on most of these points. Where I differ a bit:
> It’s best when these policies take the form of universal programs that preserve competition and individual choice.
I mostly agree here, but I had the realization that a negative income tax, while in some ways identical to UBI, is substantially more efficient than UBI in any case where taxes with deadweight losses (ie basically all taxes except land value tax) are used to fund it. Since negative income tax basically builds in a calculation of net payout (ie for a given person how much they're taxed minus how much the UBI equivalent is), it means far FAR lower taxes are needed to sustain a negative income tax, with basically 100% of the benefits that UBI has.
> Rules must be put in place to curb excessive borrowing in times when there is no recession or ongoing war.
I would argue that every time the Fed manipulates the market, it makes it harder for markets to correct inefficiencies, raises uncertainty, and generally causes additional havoc. We should not be borrowing during recessions as government spending only deepens the causes of recessions by removing allocation of resources from the free market to central planning.
I think this makes sense when you assume that means testing doesn’t cause dead weight loss.
But my understanding is that means testing is equivalent to a tax, in the sense that it imposes an effective marginal tax rate on earnings and thus like an income taxes, discourages productive activity.
I wrote an article on this. Let me know what you think:
https://open.substack.com/pub/micahe/p/means-testing-is-an-inefficient-tax?r=1fcmli&utm_medium=ios
Yes, you have a good point that the tapering in a negative income tax does act like a tax in that it causes similar deadweight losses. I haven't heard that tapering called "means testing" before but I see what you mean. While a negative income tax isn't perfect, its certainly far better than our current welfare system with its myriads of rules and cliffs.
But I do see what you mean that UBI could be more beneficial. If our tax system was based on 100% pigouvian taxes like land value taxation, which don't cause (and actually remove) deadweight losses, then I think you might be right that UBI would be better. If the additional tax revenue needed comes from income taxes and is distributed on the basis of income, then they cancel out and I think both are really identical. But if that money has to come from other taxation methods that cause deadweight losses (like sales tax, or property tax), then it would be better to do a negative income tax.
I think the other issues you brought up either have solutions or don't cause significang problems. Eg loss aversion doesn't really seem likely to impact people's decisions about this, especially once people get used to the tax regime. Loss aversion is more of an in-the-moment decision making quirk of humans, and shouldn't really apply to serious repeated long term decision making.
But interesting to think about when UBI and negative income tax can produce different incentives.
Yeah I agree!
I did an exploration of UBI vs negative income tax here: https://governology.substack.com/p/ubi-vs-negative-income-tax
obviously UBI is superior. NIT has a double phase out so it creates progressive marginal tax rates, which cannot be neutral with respect to time, and are more administratively complex.
we want progressive _effective_ tax rates not marginal tax rates.
https://www.ubicenter.org/us-flat-tax
Progressive marginal tax rates are progressive effective tax rates - you can't have one without the other. And simply repeating that its "obvious" doesn't make you right. Please stop spamming that.
I do an analysis of UBI vs EITC here
https://thomaslhutcheson.substack.com/p/ubi-no
and here
https://thomaslhutcheson.substack.com/p/ubi-after-all
obviously UBI is superior.
UBI is obviously superior to NIT. NIT is just a bad version of UBI, where you have two phase-out rates, creating progressive marginal tax rates, which are administratively more complex and cannot be neutral with respect to time. super basic econ 101 stuff.
you don't want to take about using any particular tax to fund a given expenditure. that's a fallacy called "hypothecation".
> it means far FAR lower taxes are needed to sustain a negative income tax
this is mathematically incoherent hand word salad.
> super basic econ 101 stuff
People who say stuff like that haven't put enough thought into what they're talking about. Everything seems "simple basic obvious 101 even idiots know" if you refuse to think about it deeply. You aren't making a contribution here dude, you're just spamming.
> this is mathematically incoherent hand word salad.
What about "lower taxes are needed" don't you understand? You need to take a step back because you're being obnoxious.
What could "Fed manipulates markets" mean? I agree that the Fed's policies should be predictable.
https://thomaslhutcheson.substack.com/p/improving-fed-decisions