Economist; Professor @UCLA_Law; sr fellow @PIIE; former tax DAS at Treasury; Author, Open: The Progressive Case for Free Trade, Immigration, and Global Capital
LAX; PDX
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For the journalists out there, those numbers are not tariffs. The European Union, e.g., has weighted average tariff rates of ~ 3% and arguably lower on US goods. So they are clearly including VATs and who knows what else?? This false reciprocity is nonsense. For more, see:
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Update: Sworn in today as deputy assistant secretary for tax analysis in Treasury. Tax policy is a key tool for tackling our biggest challenges, incl. pandemic relief & recovery, climate change, and inequality. Grateful to be part of Biden policy team! Fired up and ready to go.
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Here's a paper that deserves more downloads, on the 1918 flu.
Findings in short: Cities that intervene more aggressively grow faster afterwards. More early/aggressive interventions lower mortality *and* reduce negative economic consequences.
papers.ssrn.com/sol3/papers.…
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Net 175,000 missing manufacturing jobs due to Trump's reckless trade wars, plus higher prices for consumers and slower growth. Excellent summary of recent research from @Kadee_Russ.
“The Trade War Has Cost 175,000 Manufacturing Jobs and Counting” econbrowser.com/archives/202…
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(1/3) Oren Cass had a piece recently in the Atlantic (theatlantic.com/politics/arc…) that mischaracterizes what we know (and don’t know) about tariffs. Maurice Obstfeld and I respond here (the Atlantic declined to publish).
piie.com/blogs/realtime-econ…
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Time to reread this, folks.
God Help Us if Judy Shelton Joins the Fed nytimes.com/2020/07/22/opini…
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Vote by mail is ALWAYS a good idea, and it is the only sensible solution now. It has worked beautifully in Oregon with no issues of fraud, and it enables busy people to participate in democracy. Every state should adopt. And while we're at it, automatic voter registration.
Senators push to let every American vote by mail as coronavirus keeps people at home cnb.cx/3b0Qw0m
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Everyone had their own way of copying with the 2016 election; this was mine. I'll be relentless tweeting about it later, but it's exciting to get author copies today. Available for pre-order from hup.harvard.edu/catalog.php?… or amazon.com/gp/product/067491….
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(1/9) How to make a more equitable globalization? The tax system is essential. Of late, the labor share of income has fallen, yet capital is difficult to tax due to its international mobility. In a new draft, @gabriel_zucman, Emmanuel Saez and I propose a coordinated minimum tax.
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Trump's pushing all-around inflationary agenda. (1) Tariffs = regressive, distortionary tax on consumption (2) less immigration => price pressures, (3) unfunded tax cuts => price pressures , (4) threatening Fed independence, and (5) weak dollar policy.
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Update: I’ve finished my service at Treasury. I have so much respect and admiration for the Treasury team, and most especially our leader, the inimitable @SecYellen, who has done so much to move us forward over the prior 17 months. More later, but for now, rest.
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Terrific policy. A carbon tax, 70 % rebated to those with low&middle incomes and 30% used for green infrastructure, R&D, and adjustment. Nice.
Senators to unveil carbon tax bill to generate $2.5 trillion in 10... reut.rs/2Y4rdZm
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Good piece from @Noahpinion: Centrists like Klobuchar are right that free college is not ideal policy. But free college for low-income kids, and free community college, is achievable. "This is a case when big promises should give way to smart policy."
bloomberg.com/opinion/articl…
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(3/3) The costs of tariffs are very real, and there are far better ways to achieve the laudable goals of middle-class prosperity & high-quality job creation. In fact, tariffs often harm these goals, by hurting US supply chains, exports, and productivity. Read our piece for more.
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Nice to see the public focusing on facts that were there all along. The Tax Policy Center, the JCT, and the CBO analyses all back public's perception.
“survey commissioned by RNC has glum conclusion: voters overwhelmingly believe Trump tax cut helps wealthy instead of average Americans. by 61%-30%, respondents said the law benefits ‘large corporations and rich Americans’ over ‘middle class families’ “ bloomberg.com/news/articles/…
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🧵 (1/20): Re the House tax bill, some early observations.
Across the political spectrum, tax wonks have found little to love. The bill is utterly unprincipled. By the bipartisan policy principles I outlined in February, it scores ~ 0.5 out of 8. Let’s take the issues 1 by 1.
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The Economist endorsement.
"[Biden] would enter the White House with the promise of the most precious gift that democracies can bestow: renewal."
America’s election – Why it has to be Biden economist.com/leaders/2020/1…
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There are (so) many smarter ways to be pro-labor than putting the Jones Act before the people of Puerto Rico.
NEW: White House under mounting pressure - from Dems & Rs - to grant Puerto Rico a waiver for shipment of diesel just off island
4 PR officials went to WH today to press case
Huge danger w/ water & sewage plants not operational
Biden aides noncommittal
washingtonpost.com/politics/…
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Score one for the betting markets. Here are the predictit markets from just before the election. So far they've been right about *every* state that's been called.
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Attacks on higher education save $69b and hurt millions; estate tax repeal costs $172b to help 1/5 of 1%; this makes America competitive??? nitter.app/Austan_Goolsbee/status…
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(1/10) What do we learn about profit shifting from the new country by country data? At least five important lessons!
My new paper from Tax Notes (Fed/Intl) is now publicly available on SSRN.
papers.ssrn.com/sol3/papers.…
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(2/3) What is right in the Cass piece has been long understood, and much of what is new is simply wrong. Tariffs can be useful for national security rationale, and there are instances where they can be helpful remedies, but their broad use is wrongheaded.
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The Senate’s tax bill is a sweeping change to every part of federal health care vox.com/policy-and-politics/… via @voxdotcom
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🧵[1/11] In our new @PIIE paper (forthcoming, summer JEP), Catherine Wolfram and I consider the frictions created by asymmetric climate change policies. What happens when some countries subsidize, and others impose costs?piie.com/publications/workin…
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Given capital's increasing role in the economy over the prior decades, and increased inequality, any net tax cuts should be directed toward labor. Business tax reforms should be revenue neutral.
democracyjournal.org/magazin…
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🧵 (1/6) In a just released @PIIE blog, Maurice Obstfeld and I examine the limits of Trump’s desire to replace income taxes with tariffs. In short, a full replacement is impossible. And, if you push this policy to its limit, it would be bad by any metric.
piie.com/blogs/realtime-econ…
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D candidates shouldn't be scared to repeal the tariffs. They're ineffective in their stated aims, they're harmful to our workers and firms, and they are a regressive consumption tax.
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(1/6) My former Treasury colleague #CatherineWolfram on why blocking permitting reform is both inefficient and inequitable.
Progressives should have supported Manchin’s permitting reforms: Here’s why
thehill.com/opinion/energy-e…
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Do you love data, taxes, and research? And do you have serious experience in same? Apply to be the Chief Data and Analytics Officer at IRS.
usajobs.gov/GetJob/ViewDetai…
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I couldn't agree more. Great facts, figures, and arguments in this terrific piece from @mattyglesias
Immigration makes America great vox.com/policy-and-politics/… via @voxdotcom
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A carbon tax should be part of every climate plan.
Taxes aren't popular, but a carbon tax can pay for lower rates elsewhere in the system, offsetting (or more than offsetting) any effects on distribution.
wapo.st/2Ikulpe?tid=ss_tw&ut…
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As voting starts, I fully expect to lose to the many followers of @webdevMason. But I literally wrote the book defending free trade and immigration, and fully support Taco trucks on every corner. Even if you vote for the opposition, check out the book.
amazon.com/Open-Progressive-…
The Meetup Region
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Reed Economics Professor @KClausing (3)
vs.
Bay area graphic designer and caterpillar rancher @webdevMason (14)
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We've been over this, but for anyone still curious about who pays for US tariffs, it is US buyers of imports.
The evidence is crystal clear. If you want to dig deeper, read the many careful studies in footnote 7 of my piece with @melovely_max.
piie.com/publications/policy…
I am NOT proposing a National Sales Tax, as the Democrats say in their Advertisements against me. Dems know what they are saying is a blatant lie. I am proposing tariffs on other countries that take advantage of us, hardly a NST. These tariffs are paid for by the abusing country, NOT THE AMERICAN CONSUMER. They do not cause inflation, and will MAKE AMERICA RICH AGAIN!
Donald Trump Truth Social 03:43 PM EST 10/24/24
@realDonaldTrump
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More evidence that anti-immigrant policies generate tremendous economic self-harm: 83% Of America's Top High School Science Students Are The Children Of Immigrants via @forbes forbes.com/sites/stuartander…
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A nice defense of the CRS from Ed Kleinbard.
(Just because you don't like the findings of a CRS report, it doesn't mean the CRS is to blame.)
Chuck Grassley is bullying the Congressional Research Service thehill.com/opinion/450906-c…
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🧵 (1/10) In today’s new brief, @melovely_max and I analyze key Trump proposals, viewing tariffs as fiscal policy. Trump's new tariffs & tax cut extensions combine regressive tax cuts & regressive tax increases, increasing the deficit & harming workers.
piie.com/publications/policy…
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Not only is there no evidence an investment boom from TCJA, but trade wars have made US investment less competitive. Throwing sand in the wheels of international supply chains is not a way to improve competitiveness.
A core promise of President Trump's economic policies -- on trade, taxes and regulation -- is that they will bring back a wave of jobs that had been outsourced and investment that was driven offshore.
So far, there is no evidence of that.
nytimes.com/2019/08/13/busin…
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A nice review of the evidence here. In short, immigration is a boon for economic growth and innovation (and the immigrants themselves), but there is no good evidence of harmful effects on native-born workers. See also chapter 8 of my book Open, now in paperback.
Let this post be your one-stop shop for evidence on why immigration doesn't hurt wages.
noahpinion.substack.com/p/wh…
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And thanks to everyone for their well wishes; I got scooped while I was sorting out paperwork and techology :).
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(1/6) I have posted a research note titled “How Big is Profit Shifting?” It is available here: papers.ssrn.com/sol3/papers.…
This note responds to a recent critique that argues that profit shifting is much smaller than we thought. In short, it is not.
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Don't let the rest of last week's news distract you from this stunning story.
Fewer Than 0.5 Percent of Very High-Income Households Paid as Little Tax As Donald Trump: tpc.io/2ERL8Ce via @TaxPolicyCenter
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Biden, Democratic Victories Would Be Best Outcome For The Economy, Moody’s Says via @forbes forbes.com/sites/sergeiklebn…
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Making corporate inversions great again.
JUST IN: Treasury Department officials are considering rolling back a tax rule aimed at preventing American companies from moving money offshore to avoid U.S. taxes. btaxgo.com/ij7UhXm
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We run a surplus with Brazil. In case anyone was wondering whether there is even that (deeply misguided) rationale for the tariff.
These tariffs are about holding countries, industries, and American consumers hostage to whims of a mercurial Administration.
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Pete Buttigieg is more electable than Bernie Sanders — and more progressive than you think vox.com/2020/2/4/21121636/pe… via @voxdotcom
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(1/6) Today, on tax day, I was delighted to testify at the @SenateBudget hearing on the importance of collecting more tax revenue. My testimony, linked below, focuses on the importance of international tax reform.
budget.senate.gov/hearings/a…
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This is your reminder that tariffs are regressive consumption taxes (even more than VATs).
And that companies and their workers benefit from open trade in a variety of ways (exporters avoid retaliation; imported inputs are not more expensive, risking competitiveness, etc).
New: Trump is vowing an "automatic" 10% tariff on *ALL* imports to US
Calls for "ring" around US economy
Would likely mean global trade war far surpassing his 1st term's
Came up at Bedminster dinner last week w/ top aides, including Kudlow & Gingrich
washingtonpost.com/business/…
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(1/11) I have new updates to my profit shifting work. In a revision of “Profit Shifting Before and After TCJA”, I investigate the size of profit shifting, and how it is likely to change (or not) after TJCA.
papers.ssrn.com/sol3/papers.…
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(1/4) People often underestimate how much IRS funding will help compliant taxpayers. This piece by @crampell helps explain why.
washingtonpost.com/opinions/…
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One of the biggest economic policy differences between Trump and Harris in on taxes. Trump's latest proposals would leave nearly all Americans worse off, especially so those lower in the distribution, costing median taxpayers > $2,600 a year.
piie.com/research/piie-chart… @PIIE
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"It’s particularly important to audit the wealthy well, and not simply because that’s where the money is. That’s where the cheating is, too. Studies show that the wealthiest are more likely to avoid paying taxes. "
propublica.org/article/ultra…
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From Mankiw: Why positive externalities should be subsidized (and negative ones, taxed).
Pay People to Get Vaccinated nytimes.com/2020/09/09/busin…
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🧵 (1/12) My new paper, “Capital Taxation and Market Power”, papers.ssrn.com/sol3/papers.…, argues that market power makes the entity level of tax especially important, that we should consider graduated corporate rates, and that intl. tax reform is essential to that vision.
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Opinion | If the tax bill is so great, why does the GOP keep lying about it? wapo.st/2hph69E?tid=ss_tw&ut…
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And this analysis doesn't count the regressive tariffs, which have the additional feature -- like several of the bill's tax provisions (looking at you 199A) -- of being very inefficient too.
I'm not sure I've ever seen such a brutal distributional analysis from CBO. This contrasts the Medicaid and SNAP cuts for the lowest decile with the tax cuts for the top decile.
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Who would have guessed it? (Nearly everyone.)
GOP leader concedes tax cuts may not pay for themselves as 2019 deficit grows washingtonpost.com/business/…
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I'd facepalm but we're not supposed to.
What me worry? “We're going to have Americans staying home instead of going and spending the money in other countries," Trump said. "And maybe that's one of the reasons the jobs numbers are so good.” cnn.com/2020/03/06/politics/…
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The Economist says it well: In any democracy, a party that considers pursuing a lower turnout to be a legitimate electoral strategy does not deserve to win elections.
Voting in a pandemic – economist.com/leaders/2020/0…
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This administration's ability to shoot own-goals is breathtaking. Yet another disastrously wrongheaded choice that leaves America weaker, dumber, and less respected. Also, less innovative, less entrepreneurial, and less dynamic.
President Trump will freeze green cards for new immigrants and sign an executive order to suspend H-1B, L-1, J and other temporary work visas for skilled workers, managers and au pairs through the end of the year. trib.al/VYKLuDg
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Strong piece from @gregmankiw calling for freer trade, market-based solutions to climate change, sensible improvements in healthcare access, and an embrace of our common humanity.
Why a ‘Republican Economist’ Plans to Vote in the Democratic Primary nyti.ms/2Km243f
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My latest piece. In short, Congress should reject the bill. If they fail to do so, they should brace themselves for large deficits & the gimmicks and mistakes that come from a reckless tax policy process.
The GOP's final tax bill has four fatal flaws:
thehill.com/opinion/finance/…
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Nice application of elasticity from @austan_goolsbee. Stringer Bell would be proud.
Passengers May Pay a Lot More. Drivers Won’t Accept Much Less. nyti.ms/2I8Ge1h
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So appreciate @Noahpinion stance against sanewashing Trump's policies.
"Bad ideas don’t need help from smart people. An intellectual’s job is different than a lawyer’s. If I had tried to steelman the antivax position in 2021 ... [it's] likely to have gotten a few people killed"
Steelmanning:
1. Often seems weak and insincere
2. Can result in "sanewashing" of crazy ideas
3. Can distract people from the flaws of real policies
4. Can inject bad assumptions into the discourse by accident
noahpinion.blog/p/against-st…
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My kind of tax avoidance!
1. Trump admin imposes tariffs on bottles of French wine
2. Florida company imports truckloads of bulk wine from France, bottles the product at its own plant
3. Et voilà! no tariff
n.pr/2Jo6eaB
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I'm thrilled to be joining @PIIE as a nonresident senior fellow. I've admired PIIE work for decades, and I look forward to collaborating with PIIE's many amazing researchers on today's pressing economic policy problems.
piie.com/newsroom/press-rele…
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(1/8) 🧵 New paper! My JEP piece on “US International Corporate Taxation after TCJA” will be published soon and is now posted. Within, I discuss what we’ve learned from TCJA, and the future of US international taxation.
papers.ssrn.com/sol3/papers.…
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#EconTwitter: Do you want to teach intellectually curious undergraduates and live in Portland, Oregon? Reed College is hiring! Tenure-track assistant or associate.
apply.interfolio.com/81384
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Taxpayers paid once for the bailout. And they paid a second time in higher prices for tariffed goods.
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Very happy about this nomination. (And, also, about the first woman Treasury Secretary.)
NEWS: Joe Biden intends to nominate former Fed chair Janet Yellen to serve as Treasury secretary. If confirmed, she will be the first woman to have the job wsj.com/articles/janet-yelle…
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(1/8) A Thread on What I Hope We Learn from This.
I hope we see that we are all from New York, Wuhan, and Lombardy, and we share our common humanity. I hope human suffering stirs compassion, and human generosity is met with admiration.
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🧵(1/7) In today’s Hill op-ed, Catherine Wolfram and I argue that: while no politician will run on increasing taxes, a carbon fee is something that should be on the table in 2025, for a few key reasons.
thehill.com/opinion/energy-e…
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Trump: My tax plan would grow the economy. Tax Policy Center: No, it would shrink it by 4%. vox.com/policy-and-politics/… via @voxdotcom
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(1/2) At the one year anniversary of Inflation Reduction Act, it's time to celebrate adequate funding for the IRS.
@NatashaRSarin explains five reasons why.
wapo.st/3sgIyy8
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Congratulations to the inimitable @HBoushey on the NYT profile. I highly recommend her must-read book on these themes, Unbound.
A Gen-X Adviser to Biden Argues Equality Is Good for Growth nytimes.com/2020/08/28/busin…
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Another ridiculous US policy stance. Hopefully the next administration will see the wisdom of a carbon tax.
US threatens retaliation against EU over carbon tax ft.com/content/f7ee830c-3ee6… via @financialtimes
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A strong estate tax will ensure equal treatment of wealth and wages thehill.com/opinion/finance/…
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This is truly terrible economic policy.
Trump takes yet more steps to keep skilled foreigners out of the country. axios.com/trump-deals-anothe…
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Looks like I'm going down. But, out of respect for all those Super Tuesday voters, I plan to get out of the race and endorse Joe Biden.
The Meetup Region
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Mercatus urbanism research fellow @ebwhamilton (6)
vs.
Reed Professor of Economics and @KClausing (3)
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(1/5) In my new working paper just posted on ssrn, papers.ssrn.com/sol3/papers.… , I look at U.S. multinational company profit shifting before and after the TCJA. Before the TCJA, I estimate that profit shifting by US MNCs generated an annual revenue loss of more than $100 billion.
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Worth a careful read! A reminder that, as the research clearly shows, tariffs are a regressive consumption tax paid by Americans. (And they don't help workers.)
Trump’s Tariff Would Cost the Typical American Household Roughly $1,500 Each Year americanprogressaction.org/a…
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Countries that spend more than they earn run trade deficits. Those that earn more than they spend run surpluses. Understanding that simple logic would reduce hurt feelings re trade deficits.
For more detail see ch 6 of Open: amazon.com/gp/product/067491…
nyti.ms/2TzXX9H
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My interview with NPR today. (Spoiler: R tax bills won't help workers as much as shareholders.) Economist Takes Deep Dive Into The Effects Of Slashing Corporate Taxes n.pr/2mCATrv
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Why Ds should not follow Trump down the protectionist road. It is not just bad economics, but bad politics.
Useful thread on trade polling data:
Pretty brutal new national @QuinnipiacPoll on Trump & trade:
-14 (39%-53%) on trade;
-10 (40%-50%) on China;
+8 (48%-40%) on trade policies bad for US economy;
+8 (44%-36%) on trade policies bad for personal financial situation;
poll.qu.edu/images/polling/u…
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1/7) In my piece today for the LA Times, I argue there is no time like the present (or, let’s say, soon) to replace TCJA, recession or not.
latimes.com/opinion/story/20…
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fwiw, I have a much bigger problem with forecasts that TCJA would boost wages $4,000-$9,000 (or dow 36,000) than with the use of the words "human capital", which were certainly not fitting to the situation but, at the same time, are common econo-speak.
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This is an incredibly dumb policy choice; I suggest moving in the exact opposite direction in my book Open. Foreign students are a huge boon to US economic growth, innovation, and entrepreneurship; we'd be foolish to squander these advantages.
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This is an enormously effective anti-poverty policy. It would even better to get this done permanently.
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@ne0liberal bracket voters: I Iiterally wrote a book defending free trade and immigration... useful reading now more than ever. Whether or not I have your vote, check out the book! amazon.com/Open-Progressive-…
(6) UCLA Law Economics Professor @KClausing vs (11) Guy that told us he changed his username 5 minutes after we tweeted out the bracket @spktrvc (formerly known as @manicpixieDyIan)
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Revenue is one good reason to move forward on the international tax agreement, and OECD revisions (due to better data and rising corporate profits) show that there is a lot of revenue at stake.
wsj.com/articles/global-mini…
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Big mistake. Huge.
In Washington, efforts to withdraw from the trade body are gaining momentum. That would be a big mistake. foreignpolicy.com/2020/05/28…
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The folly of IRS staffing cuts, today from @NatashaRSarin. DOGE could easily lose all of their purported savings, and more, from gutting the IRS.
DOGE says it’s saving $100 billion. It’s about to lose a lot more. wapo.st/41P2xBU
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