It may be that Piketty is right that traditional liberal policies are largely ineffective. There are, however, grounds to challenge this pessimism. Support for this challenge can be found not only on the left, but also on the center-right.
Kenneth Rogoff, a Harvard economist, contends in a review of Piketty’s book that “the idea of a global wealth tax is replete with credibility and enforcement problems, aside from being politically implausible.” Rogoff views evidence of growing inequality presented by Piketty and others as “persuasive” and he proposes a number of alternative, smaller-scale remedies to control disproportionate wealth accumulation. He suggests a shift to a “relatively flat consumption tax, with a large deductible for progressivity.” Consumption taxes apply to spending, as opposed to income taxes that are levied on wages, benefits, profits from sales, dividends and other gains. Why, Rogoff asks, should we “try to move to an improbable global wealth tax when alternatives are available that are growth friendly, raise significant revenue, and can be made progressive through a very high exemption”? full: http://www.nytimes.com/2014/05/14/opinion/edsall-thomas-piketty-and-his-critics.html --- Researchers Finally Replicated Reinhart-Rogoff, and There Are Serious Problems. Apr 16, 2013 Mike Konczal In 2010, economists Carmen Reinhart and Kenneth Rogoff released a paper, "Growth in a Time of Debt." Their "main result is that...median growth rates for countries with public debt over 90 percent of GDP are roughly one percent lower than otherwise; average (mean) growth rates are several percent lower." Countries with debt-to-GDP ratios above 90 percent have a slightly negative average growth rate, in fact. This has been one of the most cited stats in the public debate during the Great Recession. Paul Ryan's Path to Prosperity budget states their study "found conclusive empirical evidence that [debt] exceeding 90 percent of the economy has a significant negative effect on economic growth." The Washington Post editorial board takes it as an economic consensus view, stating that "debt-to-GDP could keep rising — and stick dangerously near the 90 percent mark that economists regard as a threat to sustainable economic growth." full: http://www.nextnewdeal.net/rortybomb/researchers-finally-replicated-reinhart-rogoff-and-there-are-serious-problems _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
