I’ve often thought that the original point of the Senate was to make the passage of laws a bit like negotiating a treaty. Recall that the Senate was originally appointed by the state legislatures, not elected by their citizens. Interestingly, the constitutional amendment for direct election was close in time to the amendment for the income tax. That rather confounds the attribution of fault to just the income tax.
This sounds... very similar to the Federalist papers. Part of the reason for the structure of the US was to try to combine the returns-to-scale in terms of security, economics, etc of a large polity with the quality of governance of a smaller polity by means of federation. It worked reasonably well, for a while, but broke down with the New Deal and especially the 60's cultural revolution (with civil rights, Great Society, massive expansion of regulatory state, 2nd wave feminism, and a whole host of other expansions to the Federal government). Sounds like you're less interested in breaking up the US then in undoing those changes.
“Progressive taxation is a form of price discrimination, where you charge more for the people who are able to pay more.” And the people who pay more use what Govt provides less or in some cases not at all.
Those who point to Scandinavian Countries as exemplars of Socialism and welfarism, miss the fact that the taxation to fund this is raised locally and local politicians close to the community are responsible for spending it. So the money raised locally is spent locally by politicians very much under the eye of the locals, who also see the quality of the service being provided. Plus although taxes pay, the providers are not Government run, but operators in a competitive private market.
When the US Constitution was ratified, total US population was around 4 million. It worked well enough at the time.
Nowadays, in states with populations of around 4 million, small groups of citizens might at least have a chance of influencing policy if their issue is not too contentious. At the national level, not so much.
Progressive taxation must also be a significant indirect driver of pretax income inequality.
At the margin, each time a policy change is contemplated, the impact on tax revenues is assessed. Anything benefitting high-marginal-tax-rate earners will score positively; anything hurting them will score negatively. The welfare of those with more modest marginal tax rates will matter less. Note that both "rich" and "poor" have high marginal tax rates, when you consider benefit phase-outs. The government generates income from the "rich"; and it seeks to minimize the cost of the "poor". Those in the middle are of less interest.
If you have high income and pay high marginal rates, it may be comforting to consider that the higher your rate, the harder the government should be (and almost certainly is) working to create advantages for you.
I agree that Keynesian economics, the idea that fiscal rather than monetary policy should drive macroeconomic aggregates is conceptually at the root of much mischief. We would-be much better off if fiscal policy stuck to affecting the distribution of spending -- by the richer or the poorer, on investment or consumption -- and left the Fed to manage aggregate spending. This would not get in the way of commonsense deficit-financed relief during recessions but would remove the idea that deficits per se were good for "stimulating" the economy and ought to lead to structural deficits near zero.
I don't see a lot of smaller free-trading among them selves States able to have progressive taxation. [some may think that is an advantage; I do not.] But yes, we could get the Federal government out of education, urban development, most transportation except the truly interstate portions, some of EPA but lots of externalities are interstate. The headline problems: fiscal deficits (unless we also gave up our currency union,), trade and immigration restrictions (the EU is not encouraging here), climate change, and land use regulation (already fully and difunctionally under local control) would not be touched.
I think trying to improve national policy is a much better, really the only feasible, way to go.
I think this post is confusing. Smaller polities abound with progressive taxation and chronic deficits.
The villain that's "causing" inefficiently large countries is the same villain that causes inefficiently large everything. Add territory and population to a COUNTRY, and the RULER becomes more powerful and prestigious. At the margin, power accretes to leaders. This is Public Choice 101. It's why you can replace COUNTRY and RULERS with BUREAUCRACY and BUREAUCRAT or UNIVERSITY and PRESIDENT or COMPANY and CEO or CITY and MAYOR.
And most every leader will fight to maintain that turf. To reduce the size of a country (and eliminate the villains of distant, progressive taxation and maybe chronic deficits) you have to make leaders willingly give up this kind of power and prestige. That's a tall order. Maybe you can buy them off, or present them with a worse alternative (like dying).
No argument here. It's almost as if you're saying we should form a single country out of largely independent states with a federal government to minimize transaction costs.
Personally, I think California is ungovernable. I don't understand the reluctance to break it into five or ten smaller states. Well, actually I do. One group wants to predict how it will affect the balance of power in the US Senate--if they're going to lose influence, they don't like it. A second group are statewide elected officials. They like having as much power and influence as they can get and have no reason to want to give up a huge chunk of that power.
Reduce the size of US Federal Agencies - very good idea. Tho not politically feasible with so many voters so often supporting Big Gov't for their own reasons.
Today, with Big Banks and Big Tech and Big Academia, there are many meta-organizations that are too Big. These Big Orgs all are happier working in collusion with Big Gov't - to make the elites who run & manage the Big Org better off, more than provide good service to the non-elite majority.
But while a majority might slightly like it, the most passionate want more US Fed power, under their control. Everybody wants to rule the world.
"Help me make the most of freedom and of pleasure".
Tho as the abortion debate demonstrates that states CAN have significantly different laws on important issues - maybe more folks will accept that less Federal power and more local power is better.
Without a strong US central government, progressive income taxes and federal deficits, the world would have been consumed in the 1940's by some combination of Nazis, Soviets and/or Co-Prosperity Spheres, much to the detriment of everyone including Americans. And again for the Reagan deficits in the 1980's that rebuilt the US military and (I believe) convinced enough of the Soviet leadership that they couldn't compete economically.
But I guess I'm not really a devil's advocate, because I also agree that *chronic* deficits and bureaucratic bloat have weakened the US' ability to respond to China's military threats.
So yes please do shrink the federal government's mandate. But break up the United States? Not unless China, Russia and India go first.
I don't buy that progressive taxation optimizes revenue.
David Friedman points out that any tax generates revenue in proportion to the average tax rate, while imposing costs (by discouraging work) in proportion to each taxpayer's marginal tax rate.
In that regard, a progressive income tax is the worst because it singles out for the strongest discouragement the most productive workers, the ones we should least want to discourage from producing more.
I disagree mightily, the Federal government does fine in its chief duties of:
1. sending fat checks to my Mom and other old people
2. sending fat checks to my Mom’s and other old folk’s doctors
3. Postal Service
4. Coast Guard
I see no pressing need to stop those, and I notice no “heavy handedness” by the Feds whatsoever.
Now if you suggest breaking up the State of California (which takes far more tax money from me than do the Feds) I agree completely, I want a more responsive to local needs State government, especially given how much I pay it, but the Feds?
The Federal government ask little from me and does what little it does fine.
Completely agree with your (de)central thesis. A few suggestions for making it more broadly persuasive:
1. Soften the lede to make clear you're not actually looking to break the US into multiple sovereign nations, but "just" to radically devolve domestic policymaking power away from the federal government. It's clear enough if you get into the article but the headline may turn folks off. It'd also be good to explicitly acknowledge a couple of reasons why a "real" breakup would be bad, e.g. removing US influence from the world increases that of China and Russia which is bad for human liberty and prosperity.
2. Emphasize not just the efficiency gains of devolution but the importance of devolution in response to polarization and culture wars, to remove fuel from those fires by reducing the federal government's power to serve as a culture-warring weapon. The US federal government probably works much worse than you'd even expect from just our size and heterogeneity, because no matter who wins federal power, at least a third of the country will regard them not as an ordinary political opponent but as an evil enemy who is a mortal threat to their values and way of life. To fix that we have to lower the stakes of federal elections: we have to make it clear to Californians that nobody is coming for their abortions and to Idahoans that nobody is coming for their guns.
3. Grapple at least a bit with one of the other major reasons for federal government growth in the 20th C, namely the perpetration of vicious and indeed terroristic racist oppression by many states in the Jim Crow era under the slogan of "states' rights". If you want to build a broad coalition for devolution you have to show how it wouldn't just lead back to more such oppression, whether that's by continued and strengthened federal voting rights protections or some other device.
Isn’t a key reason for a strong federal government national defense? In a world with China and Russia do we really want to break the US into 10 or 20 smaller countries?
I’ve often thought that the original point of the Senate was to make the passage of laws a bit like negotiating a treaty. Recall that the Senate was originally appointed by the state legislatures, not elected by their citizens. Interestingly, the constitutional amendment for direct election was close in time to the amendment for the income tax. That rather confounds the attribution of fault to just the income tax.
This sounds... very similar to the Federalist papers. Part of the reason for the structure of the US was to try to combine the returns-to-scale in terms of security, economics, etc of a large polity with the quality of governance of a smaller polity by means of federation. It worked reasonably well, for a while, but broke down with the New Deal and especially the 60's cultural revolution (with civil rights, Great Society, massive expansion of regulatory state, 2nd wave feminism, and a whole host of other expansions to the Federal government). Sounds like you're less interested in breaking up the US then in undoing those changes.
“Progressive taxation is a form of price discrimination, where you charge more for the people who are able to pay more.” And the people who pay more use what Govt provides less or in some cases not at all.
Those who point to Scandinavian Countries as exemplars of Socialism and welfarism, miss the fact that the taxation to fund this is raised locally and local politicians close to the community are responsible for spending it. So the money raised locally is spent locally by politicians very much under the eye of the locals, who also see the quality of the service being provided. Plus although taxes pay, the providers are not Government run, but operators in a competitive private market.
When the US Constitution was ratified, total US population was around 4 million. It worked well enough at the time.
Nowadays, in states with populations of around 4 million, small groups of citizens might at least have a chance of influencing policy if their issue is not too contentious. At the national level, not so much.
Progressive taxation must also be a significant indirect driver of pretax income inequality.
At the margin, each time a policy change is contemplated, the impact on tax revenues is assessed. Anything benefitting high-marginal-tax-rate earners will score positively; anything hurting them will score negatively. The welfare of those with more modest marginal tax rates will matter less. Note that both "rich" and "poor" have high marginal tax rates, when you consider benefit phase-outs. The government generates income from the "rich"; and it seeks to minimize the cost of the "poor". Those in the middle are of less interest.
If you have high income and pay high marginal rates, it may be comforting to consider that the higher your rate, the harder the government should be (and almost certainly is) working to create advantages for you.
I agree that Keynesian economics, the idea that fiscal rather than monetary policy should drive macroeconomic aggregates is conceptually at the root of much mischief. We would-be much better off if fiscal policy stuck to affecting the distribution of spending -- by the richer or the poorer, on investment or consumption -- and left the Fed to manage aggregate spending. This would not get in the way of commonsense deficit-financed relief during recessions but would remove the idea that deficits per se were good for "stimulating" the economy and ought to lead to structural deficits near zero.
I don't see a lot of smaller free-trading among them selves States able to have progressive taxation. [some may think that is an advantage; I do not.] But yes, we could get the Federal government out of education, urban development, most transportation except the truly interstate portions, some of EPA but lots of externalities are interstate. The headline problems: fiscal deficits (unless we also gave up our currency union,), trade and immigration restrictions (the EU is not encouraging here), climate change, and land use regulation (already fully and difunctionally under local control) would not be touched.
I think trying to improve national policy is a much better, really the only feasible, way to go.
I think this post is confusing. Smaller polities abound with progressive taxation and chronic deficits.
The villain that's "causing" inefficiently large countries is the same villain that causes inefficiently large everything. Add territory and population to a COUNTRY, and the RULER becomes more powerful and prestigious. At the margin, power accretes to leaders. This is Public Choice 101. It's why you can replace COUNTRY and RULERS with BUREAUCRACY and BUREAUCRAT or UNIVERSITY and PRESIDENT or COMPANY and CEO or CITY and MAYOR.
And most every leader will fight to maintain that turf. To reduce the size of a country (and eliminate the villains of distant, progressive taxation and maybe chronic deficits) you have to make leaders willingly give up this kind of power and prestige. That's a tall order. Maybe you can buy them off, or present them with a worse alternative (like dying).
No argument here. It's almost as if you're saying we should form a single country out of largely independent states with a federal government to minimize transaction costs.
Personally, I think California is ungovernable. I don't understand the reluctance to break it into five or ten smaller states. Well, actually I do. One group wants to predict how it will affect the balance of power in the US Senate--if they're going to lose influence, they don't like it. A second group are statewide elected officials. They like having as much power and influence as they can get and have no reason to want to give up a huge chunk of that power.
Reduce the size of US Federal Agencies - very good idea. Tho not politically feasible with so many voters so often supporting Big Gov't for their own reasons.
Today, with Big Banks and Big Tech and Big Academia, there are many meta-organizations that are too Big. These Big Orgs all are happier working in collusion with Big Gov't - to make the elites who run & manage the Big Org better off, more than provide good service to the non-elite majority.
But while a majority might slightly like it, the most passionate want more US Fed power, under their control. Everybody wants to rule the world.
https://www.youtube.com/watch?v=tIBDL0YKWuw And they want the Gov't to:
"Help me make the most of freedom and of pleasure".
Tho as the abortion debate demonstrates that states CAN have significantly different laws on important issues - maybe more folks will accept that less Federal power and more local power is better.
I'll play devil's advocate.
Without a strong US central government, progressive income taxes and federal deficits, the world would have been consumed in the 1940's by some combination of Nazis, Soviets and/or Co-Prosperity Spheres, much to the detriment of everyone including Americans. And again for the Reagan deficits in the 1980's that rebuilt the US military and (I believe) convinced enough of the Soviet leadership that they couldn't compete economically.
But I guess I'm not really a devil's advocate, because I also agree that *chronic* deficits and bureaucratic bloat have weakened the US' ability to respond to China's military threats.
So yes please do shrink the federal government's mandate. But break up the United States? Not unless China, Russia and India go first.
Ok, now somehow you are advocating policies I generally agree with. I'm not used to agreeing with policy recommendations, so this is odd.
I don't buy that progressive taxation optimizes revenue.
David Friedman points out that any tax generates revenue in proportion to the average tax rate, while imposing costs (by discouraging work) in proportion to each taxpayer's marginal tax rate.
In that regard, a progressive income tax is the worst because it singles out for the strongest discouragement the most productive workers, the ones we should least want to discourage from producing more.
I disagree mightily, the Federal government does fine in its chief duties of:
1. sending fat checks to my Mom and other old people
2. sending fat checks to my Mom’s and other old folk’s doctors
3. Postal Service
4. Coast Guard
I see no pressing need to stop those, and I notice no “heavy handedness” by the Feds whatsoever.
Now if you suggest breaking up the State of California (which takes far more tax money from me than do the Feds) I agree completely, I want a more responsive to local needs State government, especially given how much I pay it, but the Feds?
The Federal government ask little from me and does what little it does fine.
Completely agree with your (de)central thesis. A few suggestions for making it more broadly persuasive:
1. Soften the lede to make clear you're not actually looking to break the US into multiple sovereign nations, but "just" to radically devolve domestic policymaking power away from the federal government. It's clear enough if you get into the article but the headline may turn folks off. It'd also be good to explicitly acknowledge a couple of reasons why a "real" breakup would be bad, e.g. removing US influence from the world increases that of China and Russia which is bad for human liberty and prosperity.
2. Emphasize not just the efficiency gains of devolution but the importance of devolution in response to polarization and culture wars, to remove fuel from those fires by reducing the federal government's power to serve as a culture-warring weapon. The US federal government probably works much worse than you'd even expect from just our size and heterogeneity, because no matter who wins federal power, at least a third of the country will regard them not as an ordinary political opponent but as an evil enemy who is a mortal threat to their values and way of life. To fix that we have to lower the stakes of federal elections: we have to make it clear to Californians that nobody is coming for their abortions and to Idahoans that nobody is coming for their guns.
3. Grapple at least a bit with one of the other major reasons for federal government growth in the 20th C, namely the perpetration of vicious and indeed terroristic racist oppression by many states in the Jim Crow era under the slogan of "states' rights". If you want to build a broad coalition for devolution you have to show how it wouldn't just lead back to more such oppression, whether that's by continued and strengthened federal voting rights protections or some other device.
Isn’t a key reason for a strong federal government national defense? In a world with China and Russia do we really want to break the US into 10 or 20 smaller countries?