Ideas for fixing the economy
The July/August “ideas” issue of the Atlantic is now online, and I’ve contributed two ideas to it. The first is essentially the Baker-Samwick proposal from August 2007, which makes so much sense to me I can’t believe it never even came close to taking off. The second is my old argument in favor of arts subsidies: you get much more bang for your buck there, especially when it comes to employment, than you do with any other kind of government spending.
Elsewhere, Megan McArdle gets rather more space than I got (she does work there, after all) to argue for abolishing corporate income taxes while raising all capital gains and dividend taxes to the general rate of income tax. The problem is that if corporate entities don’t need to pay money on non-dividended income, then rich individuals will turn themselves into companies and pay tax only on what they spend, rather than what they earn. Which might be a good thing from Megan’s perspective, but I don’t think it would do any favors for the government fisc.