Ser Scot A Ellison

Were Mao and Stalin Actually Socialists? (No True Scotsman)

202 posts in this topic

19 hours ago, Altherion said:

This is a bit of a tangent, but can you beat the Verrazano-Narrows Bridge's $17.00 EZPass toll? Although it's "only" $11.52 for New Yorkers.

I honestly don't recall on prices for specific tolls - that's pretty much the point.  If you live in rural or even suburban Florida, the tolls aren't that bad overall (which is pretty much the point, btw).  However, I lived in Orlando for seven years and the amount you'd have to spend just for driving around within the city itself was astronomical.  I'll gladly take the income taxes of the state I now live in over that bullshit - both because the difference in aggregate payout is rather negligible and I like states with higher standards for things like education, children's health insurance, and, especially, fixing the damn roads!

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Posted (edited)

11 hours ago, DunderMifflin said:

According to that chart., to me it points more towards income tax irrelevancy.(or at least not the magic wand its being sold by some as) The first two periods of inequality according to the data provided occurred before the US had an income tax

Look, saying tax rates isn't the only factor isn't the same thing as saying it's irrelevant.

If you looked at several countries to study the effect of income taxes on pre-income distribution, it wouldn't surprise me one iota, if the effects were different for each country. Certainly, the differing institutional arrangements would come in to play. Say for instance, how aggressive each country is combating monopolies. Or in supporting unions. These things would matter too.

Or put it this way. Supposing you wanted to run a regression on several countries to study the effect of income taxes on income or wealth inequality, you wouldn't just write something down like:

Income Inequality = a + B(1)*Tax Rates + e

more likely you'd write something down like:

Income Inequality = a + B(1) Tax Rates + B(2) Other Stuff + e

Now just because the coefficient on "Other Stuff" might be large and significant(in a stats sense) it doesn't follow  that B(1) is not large and significant.

From the both those charts, its pretty clear in the US, at least, that the income or wealth inequality was at its lowest point from about the Great Depression until 1980. Obviously top tax rates were high in that period. Does that mean only tax rates mattered? Probably not. Union power was generally stronger than era. So that probably had an effect. Also, more vigorous anti-trust enforcement might have mattered. But just because other things might have been in play, it doesn't follow that higher taxes are irrelevant.

In the first chart, there could be several historical events that partially explain the gradual decline in the Gini coefficient. Probably the big dent put on the Southern Planting classes' power had something to do with it. And then right around 1900, you have the rise workers movements. And then after 1900 anti-trust enforcement becomes a thing. Of course WW1 probably had an effect too.

Edited by OldGimletEye

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