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We assembled five prominent economists from across the political spectrum. We gave them a simple task: Identify major economic policies they could all stand behind.
They did. They gave us five tax proposals — plus one change to the criminal code — based on good economics.

And in the process, they gave us an economic platform that would surely sink any candidate that supported it.

We decided to bring him to life anyway. Here you have him: A political candidate who could potentially fix the economy, but would never win an election.



Get rid of the mortgage tax deduction.
The mortgage tax deduction lets homeowners deduct interest they pay on their mortgage. Gone. After all, big houses get bigger tax breaks, driving up prices for everyone. Why distort the housing market and subsidize people buying expensive homes?

End the tax deduction companies get for providing health insurance to employees.
Neither employees nor employers pay taxes on workplace health-insurance benefits. That encourages fancier insurance coverage, driving up usage and, therefore, health spending overall. The deduction costs the government an estimated $184.46 billion per year.

Eliminate the corporate income tax.
Get rid of it. Completely. If companies reinvest the money into their businesses, that's good. Don't tax companies in an effort to tax rich people. Just tax rich people.

Shift from income tax to consumption tax.
Taxes discourage whatever you're taxing, but we like income, so why tax it? Payroll taxes discrouage creating jobs. Not such a good idea. Instead, impose a consumption tax, desgined to be progressive to protect lower-income households.

Tax carbon emmisions.
Yes, that means higher gasoline prices. It's a kind of consumption tax, and can be structured to make sure it doesn't disproportionately harm lower-income Americans. More, it's taxing something that's bad, which gives people an incentive to stop polluting.

Legalize marijuana.
Stop spending so much trying to put pot users and dealers in jail - it costs a lot of money to catch them, prosecutre them, and them put them in jail. Criminilizing drugs also drives drug prices up, making gang leaders rich.

Skjellyfetti wrote:Obviously there are going to be items that everyone probably disagrees with. I certainly don't agree with everything. But, I could definitely get behind a candidate with a concrete plan like this:

Get rid of the mortgage tax deduction.
The mortgage tax deduction lets homeowners deduct interest they pay on their mortgage. Gone. After all, big houses get bigger tax breaks, driving up prices for everyone. Why distort the housing market and subsidize people buying expensive homes?

Skjellyfetti wrote: Get rid of the mortgage tax deduction.
The mortgage tax deduction lets homeowners deduct interest they pay on their mortgage. Gone. After all, big houses get bigger tax breaks, driving up prices for everyone. Why distort the housing market and subsidize people buying expensive homes?

CAA Flagship wrote: Who are these economists?

Skjellyfetti wrote:

CAA Flagship wrote: Who are these economists?

Dean Baker
Center for Economic and Policy Research
http://www.cepr.net/biographies/dean-baker/" onclick="window.open(this.href);return false;

Katherine Baicker
Professor of Health Economics
https://www.hsph.harvard.edu/faculty/katherine-baicker/" onclick="window.open(this.href);return false;

Robert H. Frank
Professor of Economics
http://www.johnson.cornell.edu/Faculty- ... px?id=rhf3" onclick="window.open(this.href);return false;

Russell D. Roberts
Professor of Economics
http://economics.gmu.edu/people/rrobert2" onclick="window.open(this.href);return false;

Luigi Zingales
Professor of Entrepreneurship and Finance
http://www.chicagobooth.edu/faculty/bio ... 2826023936" onclick="window.open(this.href);return false;

CAA Flagship wrote:

Skjellyfetti wrote:
Dean Baker
Center for Economic and Policy Research
http://www.cepr.net/biographies/dean-baker/" onclick="window.open(this.href);return false;

Katherine Baicker
Professor of Health Economics
https://www.hsph.harvard.edu/faculty/katherine-baicker/" onclick="window.open(this.href);return false;

Robert H. Frank
Professor of Economics
http://www.johnson.cornell.edu/Faculty- ... px?id=rhf3" onclick="window.open(this.href);return false;

Russell D. Roberts
Professor of Economics
http://economics.gmu.edu/people/rrobert2" onclick="window.open(this.href);return false;

Luigi Zingales
Professor of Entrepreneurship and Finance
http://www.chicagobooth.edu/faculty/bio ... 2826023936" onclick="window.open(this.href);return false;

Academia.

Grizalltheway wrote: Would you expect economists working for banks to have anything close to an objective opinion on this?

Grizalltheway wrote:
Would you expect economists working for banks to have anything close to an objective opinion on this?

Chizzang wrote:
and getting rid of the Mortgage deduction is the stupidest thing I've ever heard

CAA Flagship wrote:

Grizalltheway wrote: Would you expect economists working for banks to have anything close to an objective opinion on this?

Private industry economists help companies make business decisions. They can't afford to make mistakes.

Grizalltheway wrote:

CAA Flagship wrote: Private industry economists help companies make business decisions. They can't afford to make mistakes.

Yeah, and obviously they would never endorse a measure that would have a negative impact on their business. I honestly don't have an opinion one way or another on this issue, but the fact that academic economists think it's a good idea doesn't necessarily mean it's a bad one.

Chizzang wrote:The idea that our Federal Government "needs more tax revenue" is what's killing us...
Our Federal System takes in plenty of tax revenue to run fabulously

we do not have a federal revenue issue

Skjellyfetti wrote:

Chizzang wrote:The idea that our Federal Government "needs more tax revenue" is what's killing us...
Our Federal System takes in plenty of tax revenue to run fabulously

we do not have a federal revenue issue

Way more tax deductions than increases. Only increase would be on carbon emissions. There would obviously be a tax on marijuana as well.. but, would be a new tax.

Like I said, everyone's going to disagree with elements of it. And I disagree with parts as well. That's why I think it's an interesting proposal... and thought it would be some good fodder for discussion.

Chizzang wrote:

Grizalltheway wrote:
Would you expect economists working for banks to have anything close to an objective opinion on this?

There is no such thing as an objective opinion when it comes to money



and getting rid of the Mortgage deduction is the stupidest thing I've ever heard

Skjellyfetti wrote:

Chizzang wrote:The idea that our Federal Government "needs more tax revenue" is what's killing us...
Our Federal System takes in plenty of tax revenue to run fabulously

we do not have a federal revenue issue

Way more tax deductions than increases. Only increase would be on carbon emissions. There would obviously be a tax on marijuana as well.. but, would be a new tax.

Like I said, everyone's going to disagree with elements of it. And I disagree with parts as well. That's why I think it's an interesting proposal... and thought it would be some good fodder for discussion.

kalm wrote:

Chizzang wrote:
There is no such thing as an objective opinion when it comes to money



and getting rid of the Mortgage deduction is the stupidest thing I've ever heard

Wait a minute...I thought libertarians and conks were against government picking winners and losers???

CitadelGrad wrote:

kalm wrote:
Wait a minute...I thought libertarians and conks were against government picking winners and losers???

We are, but we also recognize that it was government picking winners and losers that led to the housing bubble. It was an egregious mistake that will take many years to correct. There is no point in compounding the error with elimination of the mortgage deduction -- at this time. As I pointed out in a previous post, it's a matter of timing. The deduction should be eliminated, but not now. The damage would be enormous.

Conservative economist Ben Stein on Thursday seemed to know that he had wandered off message when he joked that the hosts of Fox & Friends might murder him for saying that it was not possible to balance the budget without raising taxes.

“I hate to say this on Fox — and I hope I’ll be allowed to leave here alive — but I don’t think there is anyway we can cut spending enough to make a meaningful difference,” Stein told the three shocked co-hosts. “We going to have to raise taxes on very rich people, people with incomes of like say, 2, 3 million a year and up, and then slowly move it down.”

“You do not think Washington just has a spending problem?” Steve Doocy wondered.

“I do not think they just have a spending problem,” Stein explained. “I think they also have a too-low taxes problem. And while all due respect to Fox, whom I love like brothers and sisters, the taxes are too low.”

The economist noted that even more revenue could have been brought in during President George W. Bush’s presidency if taxes had not been cut.

“The evidence is that there is no connection between the level of taxation and the level of economic activity,” he pointed out. “The biggest growth we’ve ever had in this country was roughly 1941 to roughly 1973, that was the best years we ever had and those were years of much, much higher taxes than we have now, during war time and during peace time. So, the economy can grow very fast, even with much higher taxes. And we’re going to have to do something.”

“Taxes were like 70, 80 percent!” Doocy exclaimed.

“I know,” Stein agreed. “And yet, we were very prosperous, we were extremely prosperous. I mean, the highest rate was in the 90s during parts of the 50s and, yet, we were very prosperous.”

CitadelGrad wrote:

kalm wrote:
Wait a minute...I thought libertarians and conks were against government picking winners and losers???

We are, but we also recognize that it was government picking winners and losers that led to the housing bubble. It was an egregious mistake that will take many years to correct. There is no point in compounding the error with elimination of the mortgage deduction -- at this time. As I pointed out in a previous post, it's a matter of timing. The deduction should be eliminated, but not now. The damage would be enormous.

kalm wrote:

CitadelGrad wrote:
We are, but we also recognize that it was government picking winners and losers that led to the housing bubble. It was an egregious mistake that will take many years to correct. There is no point in compounding the error with elimination of the mortgage deduction -- at this time. As I pointed out in a previous post, it's a matter of timing. The deduction should be eliminated, but not now. The damage would be enormous.

I know...I just like picking on Chizzy. I pretty much fully agree with your thoughts on this.

BTW, speaking of taxation, one of my all time favorite conk economists lights some Fox News hairs on fire:

Conservative economist Ben Stein on Thursday seemed to know that he had wandered off message when he joked that the hosts of Fox & Friends might murder him for saying that it was not possible to balance the budget without raising taxes.

“I hate to say this on Fox — and I hope I’ll be allowed to leave here alive — but I don’t think there is anyway we can cut spending enough to make a meaningful difference,” Stein told the three shocked co-hosts. “We going to have to raise taxes on very rich people, people with incomes of like say, 2, 3 million a year and up, and then slowly move it down.”

“You do not think Washington just has a spending problem?” Steve Doocy wondered.

“I do not think they just have a spending problem,” Stein explained. “I think they also have a too-low taxes problem. And while all due respect to Fox, whom I love like brothers and sisters, the taxes are too low.”

The economist noted that even more revenue could have been brought in during President George W. Bush’s presidency if taxes had not been cut.

“The evidence is that there is no connection between the level of taxation and the level of economic activity,” he pointed out. “The biggest growth we’ve ever had in this country was roughly 1941 to roughly 1973, that was the best years we ever had and those were years of much, much higher taxes than we have now, during war time and during peace time. So, the economy can grow very fast, even with much higher taxes. And we’re going to have to do something.”

“Taxes were like 70, 80 percent!” Doocy exclaimed.

“I know,” Stein agreed. “And yet, we were very prosperous, we were extremely prosperous. I mean, the highest rate was in the 90s during parts of the 50s and, yet, we were very prosperous.”

Raw Story (http://s.tt/1qoZW" onclick="window.open(this.href);return false;)
http://www.rawstory.com/rs/2012/10/18/b ... e-too-low/" onclick="window.open(this.href);return false;

Their were some smart people in the Nixon administration.

Grizalltheway wrote:

CAA Flagship wrote: Academia.

Would you expect economists working for banks to have anything close to an objective take on this?

Skjellyfetti wrote:

Chizzang wrote:
and getting rid of the Mortgage deduction is the stupidest thing I've ever heard

Lots of people support it. I don't expect folks like 89Hen and blueballs to support it, because it would hurt their industry. I mean lives.

Republicans took support for the mortgage rate deduction out of their platform this year. (Doesn't mean they support eliminating it... but, a step in that direction)
Eliminating the mortgage tax deduction was part of George Romney's platform.
A bipartisan panel recommended it this summer.

Interesting read on issue:
http://www.bloomberg.com/news/2012-08-3 ... break.html" onclick="window.open(this.href);return false;


I'm not saying that it is a politically tenable position. But, that's kinda the point of the "fake" presidential candidate. Unpopular issues that would fix the economy.

Grizalltheway wrote:

kalm wrote:
I know...I just like picking on Chizzy. I pretty much fully agree with your thoughts on this.

BTW, speaking of taxation, one of my all time favorite conk economists lights some Fox News hairs on fire:





Raw Story (http://s.tt/1qoZW" onclick="window.open(this.href);return false;)
http://www.rawstory.com/rs/2012/10/18/b ... e-too-low/" onclick="window.open(this.href);return false;

Their were some smart people in the Nixon administration.

I like what Stein has to say on this, but I don't think he's taking into account the fierce international competition US companies face these days. The time period he mentioned really isn't comparable in those terms.

kalm wrote: Sure....but the points being 1) there might be some middle ground between a 91% top marginal rate and a 35% rate. There might also be some room between a 40% effective corporate tax rate and whatever the fuck the pittance is that certain industries now pay after deductions, and 2) higher tax rates don't neccessarily inhibit growth.