Comments on: Brad DeLong’s fiscal manifesto A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 By: DanHess Wed, 10 Nov 2010 20:41:35 +0000 And to think how you have attacked Gretchen Morgenson!

By: DanHess Wed, 10 Nov 2010 20:33:53 +0000 Felix, dude.

“poor black families tend to live in coal-mining regions”

What?? In whose universe?

West Virginia, the heart of coal country, is 96% white.

Poor blacks are overwhelmingly likely to live in inner cities, take metros and buses, and live in apartments and public housing.

Poor whites are overwhelmingly found in the countryside, with West Virginia being a reasonable representation. They live in detached homes or trailers that need more carbon to heat and cool and must drive great distances often.

Does this even need to be said?

It is almost certain therefore that a carbon tax would be harder on poor whites than poor blacks.

By: Curmudgeon Wed, 10 Nov 2010 11:50:13 +0000 @felix, hmmm, probably more poor white where I grew up poor (sw PA), but I can see it south of the Mason-Dixon line. In New England, where I live now, it’s an eclectic combination of home heating oil, natural gas, nuclear, and hydro (imported from Hydro Quebec).

By: Tangerinebunny Wed, 10 Nov 2010 06:39:27 +0000 Felix, you are almost certainly right that the upper NW of the US (etc.) is more energy efficient (and less racially integrated), but PLEASE back it up.

I’d put the Tobin tax above this anyway on triage. And just make everyone pay SS on 100% of their income (sacrilege!).

And Unicorns #1. … but that’s just me.

By: FelixSalmon Wed, 10 Nov 2010 04:14:33 +0000 @Curmudgeon, I’m not entirely sure myself on all the reasons, but I think it’s mainly geographical — that poor black families tend to live in coal-mining regions while poor white families are more likely to get their energy from less carbon-intensive sources like natural gas or even nuclear or hydro.

By: petertemplar Wed, 10 Nov 2010 02:04:08 +0000 I agree with Jim. DeLong thinks we have a gold standard.

For whatever reasons, Felix just ignores MMT…

By: Dollared Tue, 09 Nov 2010 23:51:49 +0000 @Curmudgeon, I hope Felix does respond with detail, but I think more modern cars and more insulated and natural gas-heated houses are good reasons to think that an upper middle class family has a smaller carbon footprint.

By: Curmudgeon Tue, 09 Nov 2010 22:21:43 +0000 >> poor black families have significantly larger carbon footprints than poor white families . . .

Okay, I’ll bite. You throw this out without support, and I can’t for the life of me figure out why it may be so (or if in fact it even is so). Rural versus urban, different definitions of poor, different housing? I don’t have a clue. Any thoughts?

By: JimBaird Tue, 09 Nov 2010 21:16:15 +0000 I was linked here from Brad’s site, but he doesn’t let people disagree with him in his comments, so I’ll respond here:

He goes off the rails right away with this: “we don’t know how the long-run fiscal gap will be closed (but we think it will be)”.

As a deficit dove, he is for fiscal stimulus now, but see government debt as somehow in the same category as private debt, needing to be “paid back”. Thus, the “long term fiscal gap”.

There is no such thing. The fact that Delong thinks there is shows that he has no understanding of the monetary system as it currently exists. A sovereign currency issuer such as the U.S. creates money by spending and destroys it by taxing. The only reason such an entity needs to tax is to remove purchasing power from the economy in order to make room for it’s spending without causing inflation. It’s not to “raise money”, since a currency issuer has no more need for “revenues” in its own currency of issue than the New York Subway needs points to put on your Metrocard.

The Federal government always has the power to make any and all payments in it’s currency of issue. If health costs continue to go up (as is likely, no matter what reforms are put in place), we may find that Government is taking up a larger share of GDP and taxes will need to be raised to cool down the economy – but that would only be once we are running at full employment and full capacity utilization. At that point, it wouldn’t be a big deal.

The only real issue is: will the real resources be there to take of the old and sick in 50, 60, 70 years? If there are, the Government will be able to enact income transfers to provide them to people who can’t afford them. If they aren’t, then no amount “fiscal rectitude” or “10 year paygo” plans, now or then, will be able to provide them.

By: DanHess Tue, 09 Nov 2010 20:44:06 +0000 If you are going to have a carbon tax, it has to be totally simple and linear. You pay for what you use, no more, no less.

That is how petrol taxes in Europe work and that is the only way to really cut back on fossil fuels.

It’s not really regressive, just fair. Al Gore will be paying the most, you and I will pay somewhere in the middle, me with my minivan and you with your travel, and the poor will pay the least.