Karl Denninger

[Reub]

Isn't it curious how the so-called progressives are always the first to denigrate others using juvenile name-calling?

Whatever happened to Obama's calls for "civility"?

[moda0306]

Isn't it curious how the so-called progressives are always the first to denigrate using juvenile name-calling?

Whatever happened to Obama's calls for "civility"?

Pot, meet kettle.

Can we just stop with this?  Both sides have their immature namecallers... what separates the adults from the children is the ability to ignore them and have a real discussion.

[doodle]

Back to Karl,

Here is his latest fix for the tax code. I think it sounds like a reasonable proposal. It results in higher revenue and greatly simplifies the taxation process. I don't think he is a right wing ideologue either. I think his ideas are bold, but today that is what we need. Unfortunately, Washington isn't listening.

http://market-ticker.org/akcs-www?post=192372

[stone]

Doodle, the problem with his proposal is that unrealized capital gains continue to escape. Wealth will just  get allocated in such a way as to ensure unrealized capital gains. That is a recipe for continued asset bubbles and distortions. In the C18th it was appreciated that taxation needed to be in the form of an asset tax in order to avoid economic distortions. Then they phrased the asset tax in terms of being a land value and monetary gold tax. The C21st interpretation of that would just be an asset tax. It is astonishing how its now just the reserve of lone crackpots like myself .

http://en.wikipedia.org/wiki/David_Ricardo
"In a careful analysis of the effects of different forms of taxation, Ricardo concludes in chapters 10 and 12 that a tax on land value, equivalent to a tax on the land rent, was the only form of taxation that would not lead to price increases; it is paid by the landlord, who is not able to pass it on to a tenant."

[Lone Wolf]

"In a careful analysis of the effects of different forms of taxation, Ricardo concludes in chapters 10 and 12 that a tax on land value, equivalent to a tax on the land rent, was the only form of taxation that would not lead to price increases; it is paid by the landlord, who is not able to pass it on to a tenant."

I haven't read Ricardo before so I'm not familiar with this idea.  Why is the landlord not able to pass this tax on to the tenant?  It seems that this would happen naturally.

[stone]

Lone Wolf, I think its based on the "economic rent" concept. Basically someone with monopoly rights is able to add a surcharge. The price they demand is not set by competition with other providers but rather is set by what the buyers are willing to pay. So if the monopoly surcharge is taxed, the price demanded will remain the same because it is already the maximum that the buyers are willing to pay. The monopoly surcharge is called "economic rent" and provides space for non-distorting taxation.
http://en.wikipedia.org/wiki/Economic_rent.