Opinion | Bidenomics Is as American as Apple Pie - The New York Times

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So when Republicans denounce the American Jobs Plan as an “out-of-control socialist spending spree,” remember, large-scale public investment is the American way.

We can say much the same thing about Biden’s tax proposals.

Actually, given extremely low borrowing costs it’s not obvious that we would even need a tax hike if infrastructure spending were the end of the story. But we will need more revenue to pay for the whole Biden program, which everyone expects will eventually include another round of spending targeted on families. So it makes sense to tie tax hikes to the jobs plan; polling suggests that paying for public investment with taxes on corporations and the rich increases support for an infrastructure plan, and that something along the lines of the Biden proposals will command very high public approval.

Republicans will no doubt denounce the idea of taxing the rich as un-American class warfare. In reality, however, such taxation is another long tradition in this country. As Thomas Piketty, the inequality scholar, likes to put it, America basically invented progressive taxation.

What about Trump’s assertion that raising corporate taxes is a form of sinister globalism? The claim here is that reversing some of the 2017 tax cut would drive investment and jobs overseas, a claim that might have some credibility if that cut had in fact induced multinational corporations to bring investment and jobs back home. But it didn’t.

In practice, the Trump corporate tax cut amounted to a giveaway to shareholders, with no visible benefits to the broader economy. And since we’re talking globalism, it’s worth pointing out that foreigners own about 40 percent of U.S. stocks.

Wait, there’s more. There’s a reason Biden’s people put “made in America” in the title of their tax plan. They believe that the Trump tax cut wasn’t just a huge money-loser, it was badly designed in ways that actually encouraged corporations to invest abroad, and that they can do better. I’ll try to get into those weeds in another column; what seems clear is that the Biden tax plan is unlikely to cause job losses and could lead to significant job gains.

There will and should be extensive debate over the details of Biden’s spend-and-tax plan over the next few months. In its broad outline, however, the plan represents a turn away from the free-market extremism that has ruled U.S. policy in recent years, back to an older tradition — the tradition that prevailed during America’s years of greatest economic success.

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The Link Lonk


April 02, 2021 at 06:01AM
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Opinion | Bidenomics Is as American as Apple Pie - The New York Times

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