Comment on Richardson: Progressive Federal Taxation Drives Redistribution from Blue to Red States

Professor Richardson documents redistribution from Democratic states to Republican states and links this to the 1994 Republican revolution -- suggesting a deliberative effort by Republicans to redistribute income towards their constituents. Seth Giertz of the University of Nebraska argues that what Professor Richardson\u27s analysis really shows is that red states -- but not necessarily Republicans within those states -- are (increasingly) the major beneficiaries of federal redistributive policies -- and that blue states are (increasingly) the benefactors

New York is not Arkansas

When she declared her candidacy for the U. S. Senate from New York, First Lady Hillary Rodham Clinton, as expected, promised to fight for an ever larger federal government—in part by expanding programs targeting children and the poor and opposing Republican tax cuts. But, Mrs. Clinton also drew attention to another issue when she declared: “It is just wrong that today New York sends $15 billion more in taxes each year to Washington than New York gets back.” Mrs. Clinton must believe that the net return of federal tax dollars to New Yorkers is unrelated to the size of the federal government—or at least believes that New York voters believe this

New York is not Arkansas

When she declared her candidacy for the U. S. Senate from New York, First Lady Hillary Rodham Clinton, as expected, promised to fight for an ever larger federal government—in part by expanding programs targeting children and the poor and opposing Republican tax cuts. But, Mrs. Clinton also drew attention to another issue when she declared: “It is just wrong that today New York sends $15 billion more in taxes each year to Washington than New York gets back.” Mrs. Clinton must believe that the net return of federal tax dollars to New Yorkers is unrelated to the size of the federal government—or at least believes that New York voters believe this

The Costs of Tax Policy Uncertainty And the Need for Tax Reform

The American Taxpayer Relief Act of 2012 (ATRA, P.L. 112-240) may be more significant for what it does not do than for what it does. Hopes for a ‘‘grand bargain’’ were not realized. In fact, ATRA does (almost) nothing to address the major fiscal problems that the United States continues to face. No one seems pleased with ATRA. Noticeably absent were the self-congratulations among members of Congress that usually accompany the passage of significant legislation — and for good reason. Even the bill’s title leaves something to be desired. The ‘‘Act of 2012’’ was not passed by Congress until 2013. The primary focus here is not on the broader merits or demerits of ATRA, but rather on the issue of tax policy uncertainty. The fiscal cliff represented an extreme case of (manufactured) policy uncertainty. A growing body of research suggests that policy uncertainty imposes substantial economic costs in and of itself. ATRA substantially lessened U.S. tax policy uncertainty over the very short term by, for the most part, making permanent the Bush tax cuts. However, all is not well. Policy uncertainty remains high. Under ATRA, added revenue will come from taxpayers at the top of the income distribution, but that will barely make a dent in the deficits that the United States has been running. Based on projections from the Congressional Budget Office, the Joint Committee on Taxation and the Office of Management and Budget, Veronique de Rugy shows that (over the next 10 years) ATRA is expected to add $332 billion in spending and$620 billion in added revenues. By contrast, projected deficit spending over the same 10 years is order of magnitudes larger than the projected deficit reductions from ATRA.2 Astrong recovery from the Great Recession would be a big help, but major structural problems would still remain

The Costs of Tax Policy Uncertainty And the Need for Tax Reform

The American Taxpayer Relief Act of 2012 (ATRA, P.L. 112-240) may be more significant for what it does not do than for what it does. Hopes for a ‘‘grand bargain’’ were not realized. In fact, ATRA does (almost) nothing to address the major fiscal problems that the United States continues to face. No one seems pleased with ATRA. Noticeably absent were the self-congratulations among members of Congress that usually accompany the passage of significant legislation — and for good reason. Even the bill’s title leaves something to be desired. The ‘‘Act of 2012’’ was not passed by Congress until 2013. The primary focus here is not on the broader merits or demerits of ATRA, but rather on the issue of tax policy uncertainty. The fiscal cliff represented an extreme case of (manufactured) policy uncertainty. A growing body of research suggests that policy uncertainty imposes substantial economic costs in and of itself. ATRA substantially lessened U.S. tax policy uncertainty over the very short term by, for the most part, making permanent the Bush tax cuts. However, all is not well. Policy uncertainty remains high. Under ATRA, added revenue will come from taxpayers at the top of the income distribution, but that will barely make a dent in the deficits that the United States has been running. Based on projections from the Congressional Budget Office, the Joint Committee on Taxation and the Office of Management and Budget, Veronique de Rugy shows that (over the next 10 years) ATRA is expected to add $332 billion in spending and$620 billion in added revenues. By contrast, projected deficit spending over the same 10 years is order of magnitudes larger than the projected deficit reductions from ATRA.2 Astrong recovery from the Great Recession would be a big help, but major structural problems would still remain

The Elasticity of Taxable Income with Respect to Marginal Tax Rates: A Critical Review

This paper critically surveys the large and growing literature estimating the elasticity of taxable income with respect to marginal tax rates (ETI) using tax return data. First, we provide a theoretical framework showing under what assumptions this elasticity can be used as a sufficient statistic for efficiency and optimal tax analysis. We discuss what other parameters should be estimated when the elasticity is not a sufficient statistic. Second, we discuss conceptually the key issues that arise in the empirical estimation of the elasticity of taxable income using the example of the 1993 top individual income tax rate increase in the United States to illustrate those issues. Third, we provide a critical discussion of most of the taxable income elasticities studies to date, both in the United States and abroad, in light of the theoretical and empirical framework we laid out. Finally, we discuss avenues for future research.

A Time-Series Econometric Model of the Upstate New York Economy

The purpose of the research described in this report is to produce an econometric model of the Upstate New York economy and two metropolitan areas within it—Albany and Syracuse. The model is intended to satisfy three main criteria. First, the model should be capable of capturing the dynamic nature of the local economy. This simply reflects the widely held belief that the local economy’s response to various external forces and policies is unlikely to be immediate. Second, the model ought to be capable of generating short-run forecasts. In particular, quarterly forecasts for one or two years are preferred to long-run forecasts. This is done in order to be most useful to the planning purposes of Niagara Mohawk. Third, the model is to be developed and maintained by economists knowledgeable of the local economy and estimated specifically for the local economies using locally available data

Development and analysis of the Soil Water Infiltration Global database.

In this paper, we present and analyze a novel global database of soil infiltration measurements, the Soil Water Infiltration Global (SWIG) database. In total, 5023 infiltration curves were collected across all continents in the SWIG database. These data were either provided and quality checked by the scientists who performed the experiments or they were digitized from published articles. Data from 54 different countries were included in the database with major contributions from Iran, China, and the USA. In addition to its extensive geographical coverage, the collected infiltration curves cover research from 1976 to late 2017. Basic information on measurement location and method, soil properties, and land use was gathered along with the infiltration data, making the database valuable for the development of pedotransfer functions (PTFs) for estimating soil hydraulic properties, for the evaluation of infiltration measurement methods, and for developing and validating infiltration models. Soil textural information (clay, silt, and sand content) is available for 3842 out of 5023 infiltration measurements (~76%) covering nearly all soil USDA textural classes except for the sandy clay and silt classes. Information on land use is available for 76% of the experimental sites with agricultural land use as the dominant type (~40%). We are convinced that the SWIG database will allow for a better parameterization of the infiltration process in land surface models and for testing infiltration models. All collected data and related soil characteristics are provided online in *.xlsx and *.csv formats for reference, and we add a disclaimer that the database is for public domain use only and can be copied freely by referencing it. Supplementary data are available at https://doi.org/10.1594/PANGAEA.885492 (Rahmati et al., 2018). Data quality assessment is strongly advised prior to any use of this database. Finally, we would like to encourage scientists to extend and update the SWIG database by uploading new data to it