Reddit mentions of The Triumph of Injustice: How the Rich Dodge Taxes and How to Make Them Pay

>These income-generating assets are what economists call capital. And because capital is heavily concentrated among the rich, the U.S. government taxed earnings derived from capital at a higher rate than earnings made through labor for the entirety of the 20th century.

>But that’s no longer the case, according to economists Emmanuel Saez and Gabriel Zucman of the University of California at Berkeley. In their new book, “The Triumph of Injustice,” they present data showing that in 2018, labor income was taxed at a higher rate than capital income for the first time in modern U.S. history.

>The proximate cause of the shift was the 2017 Tax Cuts and Jobs Act (TCJA), which dramatically slashed taxes on corporate profits and on estates — both forms of capital income — according to their analysis. But Saez and Zucman also note that the trend has been decades in the making, driven in large part by the same forces that have pushed billionaires’ tax rates below those of the working class.

>“From the 1940s to the 1980s, the average tax rate on capital exceeded 40%, while labor paid less than 25%," they write. “Since its peak of the 1950s, however, the average capital tax rate has been cut by twenty percentage points. At the same time, labor taxation has risen more than ten points, driven by the upsurge in payroll taxes.”

>For the latter part of the 20th century, many economists — particularly those who worked closely with lawmakers to craft public policy — tended to make ideologically conservative, market-oriented assumptions about how the world does and should work. In recent years, however, more economists like Saez and Zucman have started to question those assumptions.

>One of the orthodoxies Saez and Zucman challenge is the idea that the optimal tax rate on capital should be as low as possible — zero, or even less. Proponents of this idea argue that keeping capital taxes low gives businesses more money to spend, which allows them to hire more workers and pay them better wages, benefiting everyone in the economy.

>This thinking underpins much of the erosion of the capital tax rate that Saez and Zucman observe. It was the driving force behind the dramatic reduction of the corporate tax rate ushered in by President Trump’s 2017 tax cut.

>Under this line of thinking, you’d expect savings and investment to decline during periods of high capital taxation, and to rise when such taxes are low. But Saez and Zucman didn’t find any evidence of this pattern in the data: “Since 1913,” they write, “the saving and investment rates have fluctuated around 10% of national income despite enormous variation in capital taxation.”

>A more recent piece of evidence also bolsters their conclusion: Proponents of the corporate rate cut in the TCJA promised it would unleash new business investment. But the data so far shows “little reason to believe the TCJA substantially boosted investment to date,” as economist Jason Furman recently summarized for the American Enterprise Institute.

>Saez and Zucman contend that, rather than boost investment in American workers, falling tax rates on capital simply have served to fatten the wallets of corporations and their shareholders. “Less capital taxation means that the wealthy — who derive most of their income from capital — can mechanically accumulate more. This feeds a snowball effect: wealth generates income, income that is easily saved at a high rate when capital taxes are low; this saving adds to the existing stock of wealth, which in turn generates more income, and so on.”

Here is the source, it's WaPo but just open it in a private window to get around the quota.

Some details from the article:

>Americans in the bottom 90 percent derive 85 percent of their income from labor, data shows, while those in the top 1 percent get more than half their income from capital.
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>In their new book, “The Triumph of Injustice,” Emmanuel Saez and Gabriel Zucman of the University of California at Berkeley present data showing that in 2018, labor income was taxed at a higher rate than capital income for the first time in modern U.S. history.
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>...
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>The proximate cause of the shift was the 2017 Tax Cuts and Jobs Act (TCJA), which dramatically slashed taxes on corporate profits and on estates — both forms of capital income — according to their analysis. But Saez and Zucman also note that the trend has been decades in the making, driven in large part by the same forces that have pushed billionaires’ tax rates below those of the working class.

Worth noting:

>Saez and Zucman’s findings are controversial in some quarters of the economics field because they upend a number of long-held orthodoxies about the distribution of income and spending in the United States. The differences largely amount to decisions about how to assign various categories of income, wealth and taxation to different segments of the population: Are taxes on corporate profits paid by shareholders, or do they get passed on to workers? Is the earned-income tax credit a reduction in taxes or a transfer of income?

https://www.amazon.com/Triumph-Injustice-Rich-Dodge-Taxes/dp/1324002727

Thomas Piketty (of "Capital in the 20th Century" fame) has just published a 1,000 pages opus called "Capitalism and Ideology". I sure hope Destiny will buy and read it.

Will probably hit the US shelves in a few months. Meanwhile everyone should buy Emmanuel Saez and Gabriel Zucman: " The Triumph of Injustice: How the Rich Dodge Taxes and How to Make Them Pay"

Note that they are the ones who proved that billionaires pay 23% of taxes when the other classes pay 24% in average, and that Zucman is an economical advisor to Bernie and Warren.

Hey man wanted to give you a heads up.

Two economists who are advising Sen Warren on tax policy have a book coming out tomorrow.

The Triumph of Injustice: How the Rich Dodge Taxes and How to Make Them Pay

The source article for this whole discussion has some nice sources. I think the original study, and the response they made to criticism is a good start.

www.amazon.co.uk/dp/1324002727/ref=as_li_qf_asin_il_tl?ie=UTF8&linkCode=gs2&linkId=db49e4d67f8bcc75b6753ce0958333da&creativeASIN=1324002727&tag=slate01-21&creative=9325

https://www.aei.org/economics/not-much-what-macroeconomic-data-say-about-the-impact-of-the-tax-cuts-and-jobs-act/

http://gabriel-zucman.eu/files/PSZ2019.pdf

The actual source is this book https://www.amazon.com/Triumph-Injustice-Rich-Dodge-Taxes/dp/1324002727

Never said there was "That's according to an analysis of tax data by the University of California at Berkeley's Emmanuel Saez and Gabriel Zucman for their upcoming book "The Triumph of Injustice.""