> We should be taxing wealth and not income (or roughly speaking, unearned instead of earned income).

    > quantitive easing pumping up asset prices while doing nothing for the real economy

    > global corporate tax avoidance

Corporations aren't people; they don't ever actually pay taxes. People pay taxes. Yes, I know corporations are legal entities, but they're owned and managed by people, somewhere down the line. Those are the people the corporate tax is intended to target.

Presumably, the "goal" here is to get the corporations with scale economies, negotiation power, etc. to be taxed and use this to redistribute economic gains.

But what happens is that instead the burden of these taxes fall onto the shoulders of non-management workers in the firms and the people who buy what the firm produces. Because the incidence of a tax is indirectly distributed by a mechanism which depends itself on the negotiation power of the actors in the system.

That is the exact opposite group of the original intention (you'd want the burden to be as much as possible on managerial staff and shareholders -- eg. the people running the corporations). Also, the tax is distortionary and incentivizes all sorts of unproductive practices.

Of course, the tax would have to be replaced with something. That something should target the people owning and running the companies to make sure the tax burden is actually bore by them.

Consumption taxes can do that.

    > the rise of the low-paid 'gig' economy and under-employment; fewer high paid jobs all demanding workers with ever higher levels of education (unattainable-for-many)

    > A crisis is brewing. They leave us no option but to make changes.

I don't think we should make any sweeping revolution, but smart, targeted changes. Of course, not all of those are pollitically feasible (imagine politically advocating for a 0% corporate tax replaced by a consumption tax and targeted taxes on shareholders and CEOs/board members).

[1] http://economics.mit.edu/files/9835

The problem with that is that it affects the poor more than the wealthy. Buying the same thing will hurt one person much more than another and will do little to ease inequality, it may exacerbate it. Additionally, it puts us in the position of making judgments about what should and should not be taxed and how much.

> Corporations aren't people; they don't ever actually pay taxes. People pay taxes.

I would buy this if we didn't give corporations so many rights. Indeed, their purpose is tools to shield individuals. Sometimes this is good; if I create a corporation and my business fails, they cannot come after my personal assets and that encourages economic investment. But it can also be bad when the corporation becomes a place to hide my assets from taxation or even to avoid personal responsibility. They can engage in speech, litigate in court, and even get government benefits such as grants or funding. Because of this, we should tax them.

Only people have mouths. A corporation is not a person, it is a group of people. And those people are the ones who pay taxes and engage in speech. Corporations do not exist, outside of them being a representation for the owner behind them.

However, one argument against lowering corporate taxes I've seen is that it would incentivize people to skirt around their personal taxes by "using" corporations. Instead of buying your own car, let a corporation (maybe your employer, maybe your own 1-person corporation that everybody would set up in a system like this?) own the car and you just use it. So somehow you'd need to prevent that kind of behavior. Perhaps shifting the tax burden from income to consumption would do that, IDK and I'm too tired to think about it now.

Another tax that economists generally seem to think well of, is land value taxes (originally by Henry George, IIRC). But these seem more or less impossible politically, as the politicians are generally better of than the average Joe and tend to own more land/property..

http://www.ird.govt.nz/business-income-tax/expenses/vehicle-...

I just want to say I disagree with this. I'm going to claim that the only difference between the armchair-economists and the PhDs who set the policy is that the policy-wonks actually get to implement their bullshit, while the armchair-economist is powerless to affect anyone.

Also, how is your claim that a consumption tax and 0% corporate tax not the very pomposity your object to?

I was under the impression that a land value tax was the most widely supported amongst economists (due to its efficiency, lack of distorting effects, and difficulty in avoiding).

> Both the "pumping up asset prices" and "while doing nothing for the real economy" is extremely disputable. It's kind of pompous of you to think you know better than the team of PhDs at the Fed, too.

See Richard Koo regarding balance sheet recessions for a less pompous assertion that QE does little to help. There are plenty of other eminent economists such as Mr Koo who also disagree with the FED's 'team of PhD's'.

  You'll see most economists advocating a consumption tax, instead.

  The corporate tax should be 0%. No, I'm not kidding; hear me out.
  Corporations aren't people; they don't ever actually pay taxes. People pay taxes. Yes, I know corporations are legal entities, but they're owned and managed by people, somewhere down the line. Those are the people the corporate tax is intended to target.
  Presumably, the "goal" here is to get the corporations with scale economies, negotiation power, etc. to be taxed and use this to redistribute economic gains.
  But what happens is that instead the burden of these taxes fall onto the shoulders of non-management workers in the firms and the people who buy what the firm produces. Because the incidence of a tax is indirectly distributed by a mechanism which depends itself on the negotiation power of the actors in the system.

This seems tautological to me. Of course increases in corporate tax are born by non-management employees and consumers. Take Management + Non-management + Customers as a group, then Management represent approximately 0% of this group. Also, Non-management + Customers aren't in a position to change the flow of money through the corporation to shield themselves from changes to taxation.

For the majority of corporations their income comes from consumer spending. In those cases it's always the consumer who pays.

Sure but that isn't how human psychology works. Especially in rich countries, where basic needs are met, inequality start playing a much greater role with respect to happiness.

Inequality has always been an important factor. The poor in France probably had it better than people in the stone age or medieval times when they made their revolution. Some can be said for the Russians. But they all made revolutions due to the high level of inequality.

If you look at countries experiencing big revolutions it seems to me to have not been about how poor or rich the countries were in absolute terms but rather how unequal they were. In fact in exceptionally poor countries you don't get any revolutions at all because people are to busy just surviving, and there is no intellectual class to advocate it and fuel the flames.

Also "better" is a tricky term. Every society place different expectations on people's lifestyles. One interesting thing I observed about America e.g. is that if you look at things purely statistically in terms on material goods you'll find that the Americans has more TVs, bigger house, more and bigger cars, more of all sorts of stuff, go out eating more frequently etc than say your average Scandinavian or Dutch person. Yet interestingly when you talk to these Americans life seems much harder. They worry about having enough money to repair their car if it breaks down. They need to go to work or whatever. They worry about not being properly covered on medical insurance, not having enough money for their kids college. They seem terrified of losing their job, or getting one will less good health insurance or whatever because they have a particular condition which requires this or that particular insurance which only the particular job they have now provides. So many seem overworked and stressed out.

In comparison, I don't even have a car, and it isn't a big deal. I go to work on a subway. My dutch friends would often just have biked. College education, no worries already taken care of by government. Health insurance. Same deal. Worried about losing job. Not a big deal, my work doesn't have any special perks I need and unemployment benefits are quite good so I will manage fine until I find a new job.

It seems American society has manage to create this system where the only acceptable lifestyle for a normal person is simply far more expensive than most can afford and they borrow money to keep up appearances. While in most of Europe you can be happy with a lot less. The really important things in life are taken care of like health, school, work etc.

Having smaller houses, cars and fewer huge flatscreen TVs seem like a small disadvantage in comparison.

I am not saying one thing is better. If American truly just want lots of stuff, maybe that is the best approach, but it just doesn't seem to make people that happy or calm to me.

This is the ginormously over-sized glowing fluorescent pink elephant in the room.

"Fix the economy" isn't going to work because the economy isn't a thing you can take in for repair. The Economy is a confusing thing because we talk about it like it's a noun, but it's really a verb: The Economy is something humans do, like sport or recreation.

The US needs to do some deep re-thinking about what it values. I'm in Australia and we seem to be doing a fairly good job of adopting the US model, despite there being some, in my opinion, better models to choose from.