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One of the most significant and most crucial social issues is unemployment. The proportion of the working population that meets the "unemployment conditions" is known as the unemployment rate. The number of jobless people actively seeking employment is difficult to estimate, particularly the number of those whose unemployment benefits have already run out before obtaining work. Unemployment has a high cost for both the person and the group. But unemployment also has other consequences. For instance, one of the socially damaging effects of widespread unemployment is that it minimizes the need to humanize the workplace [1]. Unemployment rates are becoming more and more erratic. The accumulation of physical and human capital, an increase in productivity, and the development of new goods due to technological innovation have long been seen as the main drivers of economic expansion. Increased specialization of labor is also essential for increasing productivity [2]. In human economic progress, economic growth has been directly fueled by the ongoing expansion in the total amount of capital over time. The favored strategy for economic growth in today's developing nations is still high accumulation and high investment for increased economic growth rates [3]. In contrast, in economics, a recession is a phase of the business cycle during which economic activity often slows and enterprises contract, typically as a result of substantial declines in consumer expenditure. Financial crises, friction in international trade, unfavorable market supply, or the fall of an economic bubble can all lead to recessions [4]. When there is a recession, there is an increase in unemployment and a fall in macroeconomic indexes including GDP, employment, capacity utilization, household income, corporate profits, and inflation

Overall, the report painted a mostly encouraging picture of the job market. Yet there were some mixed messages in the May figures. Notably, the unemployment rate rose to 3.7 percent, from a five-decade low of 3.4 percent in April. It’s the highest unemployment rate since October. (The government compiles the unemployment data using a different survey than the one used to calculate job gains, and the two surveys sometimes conflict.) Is the labor market as strong as the gain of 339,000 jobs suggests? Probably not. In May, employers added th e most jobs since January. So the overall picture is an encouraging one. Yet there are signs that hiring is cooling from the super-heated levels of the past two y ears. For one thing, the length of the average work week declined, to 3 4.3 hours from 34.4 in April. That is a seemingly small drop, but economists said it’s equivalent to cutting several hundred thousand jobs. It means that, on average, weekly paychecks will be slightly smaller. The average work week is down from 34.6 hours a year ago. Hourly wage growth also dipped in May, evidence that ma ny businesses feel less pressure to dangle higher pay to find and keep workers. Average hourly pay increased 4.3 percent from a year earlier. That’s down fr om gangbusters gains of nearly 6 percent a year ago. And the rise in the unemployment rate partly reflected higher layoffs. This suggested that not everyone who lost jobs in recent high-profile layoffs by banks, tech firms and media companies has found new work.

The Army's record bonuses probably kept a bad recruiting year from getting even worse, Asch said. The Army has solved recruiting crises in the past and maintained the viability of the all-volunteer force, Asch said. It probably will again. "It's recoverable," she said. "That will take effort. It's not a problem you want to have. The trick is to figure it out."

Struggling to overcome recruiting shortfalls, the Army and the Air Force have bolstered their marketing to entice legal residents to enlist, putting out pamphlets, working social media and broadening their outreach, particularly in inner cities. One key element is the use of recruiters with similar backgrounds to these potential recruits. “It is one thing to hear about the military from locals here, but it is something else when it’s from your fellow brother, from the country you’re from,” said Bidari, who was contacted by Army Staff Sgt. Kalden Lama, the Dallas recruiter, on a Facebook group that helps Nepalese people in America connect with one another. “That brother was in the group and he was recruiting and he told me about the military.” The military has had success in recruiting legal immigrants, particularly among those seeking a job, education benefits and training as well as a quick route to becoming an American citizen. But they also require additional security screening and more help filling out forms, particularly those who are less proficient in English. Both the Army and the Air Force say they will not meet their recruiting goals this year, and the Navy also expects to fall short. Pulling more from the legal immigrant population may not provide large numbers, but any small boosts will help. The Marine Corps is the only service on pace to meet its goal. The shortfalls have led to a wide range of new recruiting programs, ad campaigns and other incentives to help the services compete with often higher-paying, less risky jobs in the private sector. Defense leaders say young people are less familiar with the military, are drawn more to corporate jobs that provide similar education and other benefits, and want to avoid the risk of injury and death that service in defense of the United States could bring. In addition, they say that little more than 20% meet the physical, mental and character requirements to join. “We have large populations of legal U.S. residents who are exceptionally patriotic, they’re exceptionally grateful for the opportunities that this country has provided,” said Air Force Maj. Gen. Ed Thomas, head of the service’s recruiting command. The biggest challenges have been identifying geographic pockets of immigrant populations, finding ways to reach them and helping any of those interested navigate the complex military recruiting applications and procedures. Last October, the Army reestablished a program for legal permanent residents to apply for accelerated naturalization once they get to basic training. Recruiters began to reach out on social media, using short videos in various languages to target the top 10 countries that recruits had come from during the previous year. The Air Force effort began this year, and the first group of 14 graduated from basic training and were sworn in as new citizens in April. They included recruits from Cameroon, Jamaica, Kenya, the Philippines, Russia and South Africa. As of mid-May there were about 100 in basic training who had begun the citizenship process and about 40 who had completed it. Thomas said the program required changes to Air Force policy, coordination with U.S. Citizenship and Immigration Services and a careful screening process to ensure there are no security risks. “We have to take exceptional measures to be able to thoroughly vet and go through the security clearance investigation,” he said, adding that in many cases the immigrants are not immediately put in jobs that require top secret clearance. Under the new program, recruits are quickly enrolled in the citizenship system and when they start basic training, an expedited process kicks off, including all required paperwork and testing. By the time Air Force recruits finish their seven weeks of training, the process is complete and they are sworn in as American citizens. The first group of 14 included several who are seeking various medical jobs, while another wants to be an air transportation specialist. Thomas said Airman 1st Class Natalia Laziuk, 31, emigrated from Russia nine years ago, has dreamed of being a U.S. citizen since she was 11, and learned about the military by watching American movies and television. “Talking to this young airman, she essentially said, ‘I just wanted to be useful to my country,’” he said. “And that’s a story that we see played over and over and over again. I’ve talked to a number of these folks around the country. They’re hungry to serve.” For Bidari, who arrived in the U.S. in 2016 to attend college, the fast track to citizenship was important because it will make it easier for her to travel and bring her parents to the United States to visit. Speaking in a call from Chicago just a day after she was sworn in, she said she enlisted for six years and hopes that her future citizenship will help her become an officer. In Chicago earlier this year, Army Secretary Christine Wormuth heard from a number of recruiters about the increased outreach to immigrant communities and how it helped them meet their numbers. In the 2022 budget year, they said, the Chicago recruiting battalion enlisted 70 legal permanent residents and already this year they have enlisted 62. More broadly across the Army, close to 2,900 enlisted during the first half of this budget year, compared with about 2,200 during the same period the previous year. The largest numbers are from Jamaica, with 384, followed by Mexico, the Philippines and Haiti, but many are from Nepal, Nigeria, Ghana, Cameroon, Colombia and the Dominican Republic.

WASHINGTON - U.S. Army Recruiting Command and the Army Recruiting and Retention Task Force (ARTF) have partnered to launch a new program, the Prep for Success Digital Engagement Experience. This program aims to enhance the recruit-recruiter experience by helping future soldiers prepare for basic training while streamlining the recruitment process. Applications designed to serve as training aides and information guides are easily downloaded directly onto the cell phones of recruits at no cost. At the same time, Recruiters get a new tool making it easier for them to do their mission. Late in the Fall of 2022, the ARTF held a design-thinking workshop which included Army recruiters, Army Reserve officers, other members of the Army’s accessions enterprise and even some members of the Air Force. During the workshop the need for an enhanced engagement experience between recruiters and prospective recruits became glaringly obvious. Several of the Army Reserve officers with civilian careers in recruiting or in technology and design, brought innovative ideas to enhance employee and customer experience. The Prep for Success Digital Engagement Experience creates a connection between the recruit and the Army through an immersive digital environment which offers a range of resources to prepare them for a successful start by first meeting the demands of basic training. The program has helpful information such as: Practice the ASVAB; Basic Training Life; Military Time; the Army’s Mission; and what things to bring to basic training. "This digital engagement experience intends to be a valuable tool for anyone entering the U.S. Army and for the hardworking recruiters making that happen," said Maj. Gen. Deborah L. Kotulich, Director of the Army Recruiting and Retention Task Force. "Basic training is a new and unknown event at the beginning of an Army enlistment, but with the right preparation, future Soldiers succeed and thrive. Our goal with this program is to ensure that every future Soldier has access to tools and resources that take the unknown out of the equation, provide coaching and learning, and set every one up to succeed in basic training and beyond,” said Kotulich. The launch of the Prep for Success Digital Engagement program comes at a critical time for the U.S. Army, which has faced a challenging recruiting environment. The Army has put pressure on itself at all echelons to find new, out-of-the-box ways to attract and retain high-quality Soldiers. Generation Z is most comfortable with resources available through their personal cell phones and the Army is meeting them where they are with this innovative approach to engagement. “The app has been really beneficial to me and our recruiting office,” said Sgt. Trawn Smith, a recruiter assigned to Clifton Park, NY. “It is easily accessible and better than social media. I can take my barcode, print it out, post it around my recruiting table at a high school or event, and allow anyone to quickly start learning about the Army. And the best part is that interested applicants love the app because it is easy to use and they are learning the many things the Army offers, especially how many different jobs exist,” said Trawn. Being able to select and see what was in the Army’s list of jobs and ease of use led an applicant to begin the application process following his interaction with Sgt. Smith and the program. “Seeing each and every portion of how the Army recruitment process works, and the many jobs available and how they would fit me as a person,” said Christian, a future Soldier from Clifton Park, NY helped in making his decision to enlist. The Prep for Success Digital Engagement program represents a significant step forward for the U.S. Army in its mission to recruit and retain the best possible candidates. By enhancing the recruit – recruiter experience and increasing the ability for recruiters to make every contact count, the program has the potential to have a lasting impact on the Army's ability to meet its recruitment goals with high quality candidates ready to be part of a highly skilled, well-trained force. “This app is a possible game changer for our organization,” said Maj. Gen. Johnny Davis, U.S. Army Recruiting Command Commanding General. “Not only does it help prepare future Soldiers for the Army; it bridges the gap between the public and the Army and gives our recruiters the capability to identify and attract future talent.”

As for what can be done to help persuade more people to join the military, Riley said the Air Force has a team "examining existing policies and procedures to ensure they reflect the service members needed for the future." In one policy move to reflect changes in American culture, Riley said the Air Force recently updated its policy to allow for some hand and neck tattoos, since having body ink was found to be "irrelevant to war-fighting." Another area in which military branches are easing up on the rules is cannabis use. As medical and recreational marijuana becomes legal in more states across the country, a growing number of people who are of enlistment age have likely experimented with cannabis. As a result, Asch said the Army, for one, now allows new recruits to retest after a short period if they test positive during their initial physical exam. Other steps have also been taken to ramp up recruitment. Signing bonuses have been offered to new recruits, while new marketing initiatives have been implemented. For the Army, the latter includes returning to a tried-and-true formula. After two decades of experimenting with new slogans, the Army returned to the popular "Be All You Can Be" motto early this month.

For our first example, what might happen if the United States does not continue its missions to defeat ISIL, al Qaeda, the Taliban, and other violent extremist groups around the world? One potential regret is enduring terror movements that continue to destabilize vulnerable nations and whole regions; harm captured peoples; exploit captured territory to train terrorists, raise funds, and attract new recruits; and export violence to the United States and its allies and friends.

It remains unknown whether currently deployed forces are sufficient to achieve U.S. objectives. In fact, the United States has steadily increased troop deployments to Iraq and Syria and extended the mission in Afghanistan. However, this analysis assumes that U.S. ground forces will remain engaged at their current levels against extremist groups in order to continue to degrade them. Therefore, we assume here that these troops could not be pulled away for other operations without ending this mission. It is also possible that countering violent extremists will require more troops if the mission changes—for example, if additional ground troops are committed to combat operations, such as those in Syria and Iraq. Total troop requirements would remain those shown earlier as the worldwide commitments.

The U.S. military is often described as the “best fighting force in the world,” and we agree. It’s superior to its possible adversaries in nearly every way. No other military has the globe-spanning responsibilities, the all-domain combat experience, or the technological edge. Yet, as the United States remains militarily engaged around a world that demands unyielding attention and unwavering commitment, its military faces a dynamic threat environment that includes new and resurgent challenges in emerging battle domains such as cyber. With tensions on the Korean peninsula, a continuing series of crises in the Middle East, a rising China, and a resurgent Russia, it would be wise to keep front and center the key source of strength in the armed forces — our people. Policy debates have raged about Syria, Yemen, NATO, North Korea, and beyond. At the same time, defense acquisition experts publicly debated options related to new technologies and acquisition reform. But the new and growing challenges facing the country are all the more reason to also think about what additional approaches are needed to acquire the key personnel skills and capabilities needed to meet America’s growing and changing military requirements. The new administration has called for “a larger, more capable, and more lethal joint force, driven by a new National Defense Strategy that recognizes the need for American superiority not only on land, at sea, in the air, and in space, but also in cyberspace.” To do this, the Department of Defense has become increasingly focused on three key objectives: sustaining and improving the deterrent and warfighting prowess; establishing a force with the capabilities needed to meet the challenges in the coming years; and resetting and rebalancing after decades of conflicts.

The Army National Guard is behind on its recruiting goals for this year but is bringing more people into the ranks compared to last year, the worst recruiting year since the military went to an all-volunteer force.

The service component has come up about 10% short of its goals on recruits for each month between October and February, according to internal documents reviewed by Military.com. That's a big improvement compared to the same time frame last year in which the Army Guard came up 40% short, on average. October is the start of the military's fiscal year.

(Monica, https://www.politico.com/news/magazine/2021/11/02/hard-tax-rich-518383 , 11-2)

Taxes on the rich increased dramatically during the First and Second World Wars, but other than global catastrophes with mass casualties, nothing seems to produce the desperation that leads to broad, bipartisan consensus on raising taxes on the rich. Indeed, even a global catastrophe with mass casualties can’t always do it, as the pandemic has shown, because low interest rates have made it easier for the government to borrow instead. Where are Democrats in the tax hike fight? SharePlay Video Thus, since the Second World War, the top marginal income tax rate for individuals has declined steeply, as Democrats came around to the position that cutting taxes for the wealthy stimulates the economy (under John F. Kennedy) and then Republicans came around to the position that deficits are not a big problem (under George. W. Bush, and because of Ronald Reagan). Even if you account for all of the loopholes in the 1950s tax code, the effective tax rate for the top 1 percent — that is, the taxes they actually pay — is considerably lower now than it was at mid-century. In fact, in 2018, one study found that the top 400 billionaires were, for the first time in history, actually paying a lower tax rate than the bottom 50 percent of families. A few recent U.S. presidents have successfully raised taxes on the rich, but those efforts didn’t pay off politically. Under Bill Clinton’s administration the top marginal tax rate rose very slightly in 1993, but it did not help Clinton in the 1994 midterms. Under Barack Obama tax rates for the wealthy went up in 2013 — and then the 2014 midterm elections produced the largest gains for Republicans in the Senate since the 1980s, and in the House since the 1930s. The midterm defeats were not caused by the tax increases, but increasing taxes on the rich didn’t help either Clinton or Obama. Although polls always show majorities favorable to taxing the rich, people don’t seem to vote based on that issue. The awareness that taxing the rich doesn’t gain votes must be part of what makes moderate Democrats cautious. And because the rich can pay people to figure out how to legally violate the spirit of the law — an old standby is to find ways to turn income into things that don’t get taxed as highly, like capital gains, and a newer trick is to borrow against your assets so you don’t have to sell them and incur taxes at all — it takes a complex administrative machinery to stay ahead of them. Wyden’s wealth tax plan, which received support from over a hundred organizations, would have run into questions about whether it violated the constitutional requirement that direct taxes be proportional to a state’s population. It would also have required new procedures for valuing people’s wealth. It’s difficult to value assets as it is; you can guess how much a painting is worth but how do you really know until you try to sell it? And valuing those assets in the middle of an adversarial exchange between government and taxpayer is even harder, which may be why most of the countries that have attempted wealth taxation have ended it. It’s not impossible, and nothing says we have to restrict ourselves to what has happened in the past. But it is a big push on an issue on which notional support in polls does not translate into electoral support.

For some Democratic policy wonks, the trade-offs in both economic and political capital seem the most salient. What do you give up by implementing a jobs guarantee? What comes first: a public option for health insurance, or a major jobs plan, or an expansion of the Earned Income Tax Credit, or a universal child allowance, or a major educational debt-relief plan, or postal banking—all of which are ideas being pushed by Democratic presidential aspirants right now?

(Frances, State Government Affairs Associate at Citizens Against Government Waste https://www.cagw.org/thewastewatcher/wealth-tax-will-slow-down-economic-growth , 5-10)

According to the Manhattan Institute, wealth taxes are the least desirable form of revenue stream because wealth is too difficult to measure. Even though the federal government taxes income, the Internal Revenue Service does not keep track of wealth. Privately held companies that are not traded on the stock market also cannot not have their wealth values determined, as they are not required to report to stock owners. It is also difficult to measure wealth value since “financial assets can be hidden or moved abroad with the click of a mouse or converted into other assets.” Imposing a wealth tax will drive out the wealthiest individuals and large companies that pay the most in taxes. It will not resolve income inequality or reduce budget deficits. States should instead cut waste, fraud, abuse, and mismanagement from their budgets, which is a much more effective way to provide needed services to their inhabitants.

(Richard, Peter and Kirsten Bedford Senior Fellow (adjunct) at the Hoover Institution, is the Laurence A. Tisch Professor of Law, New York University Law School, and a senior lecturer at the University of Chicago. https://www.hoover.org/research/wealth-tax-poor-idea)

It should not, however, require this large a dose of reality to warn progressive states off yet another institutional blunder. The effort to impose a wealth tax runs afoul of the fundamental principles of taxation put in place throughout the course of the income tax era, which now spans more than a hundred years. The economic, or Haig-Simons, definition of income—the increase in net worth plus individual consumption—does not work when applied to any real-world tax system that must collect taxes from millions of people in a quick and efficient fashion. Instead, the standard way to tax wealth starts with the notion that the receipt of certain elements of wealth is taxable as income. In principle, that covers earned income and the realized gain from the sale or other disposition of property. However, it is widely known that certain kinds of benefit are so difficult to value that it is better not to recognize that gain upon receipt, so the tax is postponed until some later time when the taxpayer receives either cash or marketable securities. For instance, receiving a partnership in a business may vastly improve your financial prospects, but it doesn’t result in the taxation of that anticipated stream of income today. Instead, each year the tax is imposed as the owner takes money out of the entity as profit distributions. Similar logic applies to stock received in corporate reorganizations like mergers, spinoffs, and recapitalizations. By design, the law does not force taxpayers to calculate difficult asset values or dispose of some illiquid asset to pay the tax. The wealth tax stands in sharp contrast to this long-standing practice. Generally, rich people have diverse holdings because they have the resources to cultivate them. Many such assets, like artwork or fractional interests in a family corporation, are nearly impossible to value, impossible to sell, or both. The nonrecognition rules thus keep them out of the tax system. Today, however, we have an estate tax that requires individuals to include in their gross estate all of these difficult-to-value items, which often makes it impossible to settle a tax dispute on large estates in less than several years. Think of the wealth tax as if it were an estate tax imposed on an annual basis, but with the added logistical headache of being impossible to calculate in year two until the tax liability for year one has been established, and that establishing the tax for year one may take multiple years. These administrative burdens pile up in individual cases, and they become larger the wider the net is extended around the asset base. At this point, the acute tradeoff becomes clear: the only reliable asset class for wealth-taxation purposes is publicly traded stocks and bonds, which of course can decline rapidly in value after the tax is imposed, but also before it is collected. (Think of the position of Elon Musk and others in the class of 2022.) Necessarily, that type of tax will miss the portion of their wealth that they hold in unlisted and illiquid assets, and thus will not satisfy progressives for whom depriving the rich of wealth is every bit as important as providing additional income to the poor. National wealth taxes face this difficulty, which poses an even greater challenge for a state wealth tax, with its more limited territorial reach.

(Frances, State Government Affairs Associate at Citizens Against Government Waste https://www.cagw.org/thewastewatcher/wealth-tax-will-slow-down-economic-growth , 5-10)

President Joe Biden and several states are working on plans to “tax the rich” to pay for programs that will purportedly address public needs like childcare and education, address income inequality, or reduce budget deficits. Like similar attempts around the world to impose wealth taxes, they will stymie economic growth, fail to raise the estimated revenue, encourage businesses to move operations overseas or to lower tax states, and reduce the number of wealthy individuals. When “the rich” leave, taxes will be increased for everyone else. In 1990, there were 12 European countries that had imposed a wealth tax on their citizens, but only three still have such a tax. In France, the wealth tax led to a “exodus of an estimated 42,000 millionaires between 2002 and 2012.” In 2020, President Emmanuel Macron repealed the tax. According to the Organisation for Economic Co-operation and Development, the wealth tax, “was expensive to administer, it was hard on people with lots of assets but little cash, it distorted saving and investment decisions, it pushed the rich and their money out of the taxing countries—and, perhaps worst of all, it didn't raise much revenue.”

(Richard, Peter and Kirsten Bedford Senior Fellow (adjunct) at the Hoover Institution, is the Laurence A. Tisch Professor of Law, New York University Law School, and a senior lecturer at the University of Chicago. https://www.hoover.org/research/wealth-tax-poor-idea)

The revenue collected will fall short of expectations. Worse, the tax will damage the economy. Today’s ablest entrepreneurs will be forced to devote their time to defending their fortunes against the predation by the one or more states that lay claim to their wealth. Wealth creation and income from other sources will both fall as administrative expenses and high-stakes litigation rise. An overall decline in social wealth will likely lead to a reduction of investment and wages and consequently to a lower standard of living and a loss of tax revenues from other sources.

(VERONIQUE DE RUGY is a contributing editor at Reason. She is a senior research fellow at the Mercatus Center at George Mason University. https://reason.com/2020/08/20/wealth-taxes-make-us-poorer/ , 8-20)

Politicians are renowned for their shortsightedness. During the post-war period, for example, Republicans have very publicly opposed most tax increases. I like small government, so I'm good with that. Where I part ways with the Grand Old Party is with its failure to oppose big spending that's funded with debt, meaning future tax hikes. Their lack of spending restraint, also encouraged by Democrats, is inconsistent and means that a new source of government revenue is likely in our future. And, if that is the case, it may very well be a wealth tax. Support for taxing wealth (as distinct from income) has been picking up momentum in the United States as progressives have argued that the tax is an effective way to reduce inequality. We frequently heard calls for tax hikes on the rich like those during the Democratic presidential primary season when both Sens. Bernie Sanders (I–Vt.) and Elizabeth Warren (D–Mass.) prominently proposed such a wealth tax. And while Joe Biden hasn't endorsed a wealth tax, his spending plan is so vast that it's difficult to see how it won't be on his agenda soon. Always eager to demonstrate its progressive cred, California is considering adopting such a tax, which would make that state the first in the nation to do so. A wealth tax has many problems. While it makes for great "soak the rich" soundbites, in reality, it's ineffective at reducing inequality. What wealth taxes do best is to disrupt the accumulation of capital. Since most wealth is invested and provides capital for innovators and producers to draw upon—and for workers to work with—all Americans would suffer from a wealth tax. In a recent paper published by the Center for Freedom and Prosperity, economists John Diamond and George Zodrow of Rice University's Baker Institute added to the extensive evidence on wealth taxation's negative effects. The authors simulated the Warren wealth tax's economic effects and how that impacts the lifetime earnings of different income groups. They estimate that long-run GDP would be 2.7 percent lower than it would be without a wealth tax. They also found declines in lifetime wealth from the upper to lower-middle classes. To gauge the wealth tax's impact, Diamond and Zodrow had to make assumptions about how the money would be used. Paying down the national debt, for instance, has different implications for capital allocation than beefing up welfare programs. Since tax proponents tell us they prefer to do the latter, the simulation assumes that wealth tax revenues would be used for redistribution in similar proportions to current spending. The authors thus found small increases in lifetime per-household wealth for bottom income earners, ranging from $100 to $500. These very small "benefits" (to use the term rather loosely) come at very high costs. Initial losses in average household income would amount to about $2,500. Europe has traditionally shown a greater affinity for taxing wealth than the United States. But even in Europe, the administrative difficulties, low level of revenue collection and utter lack of impact on inequality have led many nations to abandon wealth taxation. Whereas 15 European countries have implemented wealth taxation, only three have stuck with it. Nations like France, which dropped its wealth tax in 2018, learned the hard way that taxpayers don't sit idly by while the fruits of their life's labor are looted. They go elsewhere. The wealthy are already fleeing California as it continues to increase its fiscal reliance on a tiny number of highly successful individuals. This trend cannot continue, and to quote economist Herbert Stein, "If something cannot go on forever, it will stop." It's bad enough for legislators in the state with the nation's largest economy to hit the accelerator as they approach a cliff. It would be even more foolish for the rest of the nation to follow suit. So, Republicans, if you really believe in lower taxes, think of that next time you feel generous with taxpayers' money.

(Dean, Co-Director of the Center for Economic and Policy Research, https://www.bostonreview.net/forum_response/dean-baker-wealth-tax-distraction/ , 4-5)

Stepping back from all the practical and political obstacles, the idea of a wealth tax has been an obstacle to progressive steps to reverse the upward redistribution of income. Apart from its effect of absorbing the energy of progressives, it also serves to legitimate the upward redistribution by implying that it was the result of the natural workings of the market, rather than the of a system that was deliberately rigged to shift income to the rich. Market outcomes enjoy considerable legitimacy, especially in the United States. If the rich can maintain the illusion that their immense wealth is the result of their talents, hard work, and possibly good luck, this gives them an enormous and undeserved political edge in the public debate. The reality is they structured the system to generate extreme inequality. It is far more difficult to justify extreme inequality when we show it was the result of policy choices, such as patent monopolies, that were designed for this purpose, often at an enormous efficiency cost to the economy. It is difficult to justify patent monopolies that make drugs unaffordable just so that a few well-placed people in drug companies can get immensely rich. Similarly, it is hard to justify eight- and nine-figure executive pay that comes at the expense of the companies for whom they work. An attack on inequality must center on exposing the corruption that created it, not accepting this corruption and coming up with a tax fix of dubious effectiveness.

(Dean, Co-Director of the Center for Economic and Policy Research, https://www.bostonreview.net/forum_response/dean-baker-wealth-tax-distraction/ , 4-5)

Emmanuel Saez and Gabriel Zucman are right to focus on soaring inequality as one of the major problems of our time. Unfortunately, their wealth tax is not an effective solution. Not only is it likely to prove infeasible, but it distracts from the causes of the rise in inequality, which is before-tax income, not declining tax rates. As Saez documents on his website, the reduction in top tax rates is not the major factor in the rise of inequality. While there has been a reduction in top tax rates, it is not as large as Zucman and Saez indicate. The top federal income tax rate has indeed fallen from 70 percent in the 1970s to 37 percent today, but many states have substantially raised their income tax. Rich people living in California face a marginal tax rate of 13 percent, while those in New York City pay 11 percent. The Affordable Care Act also applied a 3.8 percent tax to both the labor and investment income of the rich. This means that many of the richest people in the country still face a marginal tax rate of more than 50 percent. Of course, we could make this rate higher, but the drop-off from the 1970s is not as large as it may appear. The real story is how the market is structured to cause more before-tax income to go to the top. At the most basic level, we have made patent and copyright monopolies longer and stronger. The beneficiaries of these government-granted monopolies are overwhelmingly those at the top of the income distribution. We need look no further than Bill Gates, one of the richest people in the world, to see the importance of these monopolies for the distribution of income. Gates would likely still be working for a living if anyone could freely copy Microsoft’s software. There are plenty of other millionaires and billionaires who owe their fortunes to these monopolies. The financial sector is another major source of the country’s rising income inequality. There would be far fewer millionaires and billionaires produced in finance if the industry were subject to the same sort of sales or value-added tax as most other sectors of the economy, a privileged position that has even drawn the attention of the International Monetary Fund. Finance has been favored in many other ways—most visibly, by the bailout that saved it from the disaster it had created in building up the housing bubble. Had the market been allowed to work its magic in 2008–2009, almost all the country’s leading banks would have gone bankrupt. This would have allowed them to be reorganized and downsized as they were sold back to the private sector. Outlandish CEO pay is another major source of rising inequality. Contrary to the claims of apologists for the superrich, CEO pay is not justified by the great returns to shareholders. It is possible to write contracts that don’t give disastrously failed CEOs, such as John Stump at Wells Fargo or Dennis Muilenberg at Boeing, tens of millions of dollars as they go out the door. The reason their contracts are not written this way is that the boards who write them owe their allegiance more to top management than to shareholders. In a similar vein, there is no plausible reason that Facebook should not be subject to the same liability rules as major broadcast and print outlets. Would Mark Zuckerberg still be incredibly rich if Facebook could be sued for spreading libelous material in ads or on its users’ webpages? The point is that the market is structured in ways that have caused an enormous share of national income to be diverted to those at the top. There was nothing about the intrinsic workings of the market that led to an increased share of income to the top one percent; it was the result of a set of deliberate policies.

(Martin, Phil@York, https://www.bostonreview.net/forum_response/martin-oneill-economic-justice-requires-more-wealth-tax/ , 4-7)

Emmanuel Saez and Gabriel Zucman’s plans for wealth taxation represent a welcome and, frankly, overdue shift in the attention the economics profession pays to issues of wealth inequality. Central to this shift, of course, has been their sometime co-author, Thomas Piketty, whose 2014 book Capital in the Twenty-First Century tracked the relentless redistribution of economic rewards over the last four decades from workers—those whose income derives mainly from wage labor—to capitalists, those whose income stems instead from the rents and profits that their wealth delivers to them. Zucman and Saez provide a powerful proposal for how we might begin to address this problem—what R. H. Tawney called “the problem of riches”—through ambitious political action. But in some instances we need to be more radical than they propose, and there is also much to be done outside the tax system itself. (Some of this Piketty himself outlines in his new book, Capital and Ideology.) Start with our reasons for caring about wealth inequality. Zucman and Saez are right that wealth inequality matters not just to the degree that it determines income inequality. As they put it, “wealth is power.” Great wealth can be both cause and effect: a source of unacceptable forms of economic power as well as a consequence of such power. Wealth is not just a way of storing up opportunities for future private consumption, as in some rather innocent economists’ models. More often it is a means to shift political agendas in the direction of the wealthy by converting economic power into political power, or a way of buying educational and social advantages for family members at the expense of their fellow citizens. In this way, extreme wealth inequality corrodes the possibility of genuine democratic politics and economic justice. And these effects create accelerating feedback loops—inequality cascades—that only reinforce the power of the wealthy to organize society in their own interests. The result is the unconscionable form of economic and political domination we see today, which undermines the standing and status of all citizens. In a flourishing economy, wealth flows and circulates between and across individuals and generations. In our comparatively diseased economies, by contrast, this recirculatory flow is blocked; instead wealth pools in particular locations, creating a distorting overconcentration of power, like a malignant growth that reroutes the body’s blood flow to maintain itself. Radical surgery is a reasonable course of action in dealing with such a serious condition. We should not be even remotely troubled, then, by the most “radical” version of the wealth tax Zucman and Saez propose. A 10 percent marginal tax rate on wealth holdings over $1 billion may go beyond anything proposed by Elizabeth Warren or Bernie Sanders, but it is a proportionate response to a deep and difficult problem. Nevertheless, while billionaires may provide an easily identifiable group at the very top of the wealth distribution, the problems of wealth inequality—and of the corresponding concentration of social, political, and economic power—reach much further down that distribution. There is also, then, a strong case to be made for serious rates of wealth taxation applied to those who are merely among the deca-millionaires and centa-millionaires. Moreover, although Zucman and Saez focus on the taxation of wealthy citizens by means of a consolidated wealth tax, there are pragmatic reasons to retain specific forms of property taxation on residential property, especially as a means of taxing some members of the wealthiest groups who manage to find ways to transcend international boundaries. One need only think here of the way that many wealthy Russian plutocrats have stored their money outside their national jurisdiction through buying residential property in London, Paris, or New York. There are also good reasons to retain a distinct inheritance tax in addition to the consolidated wealth tax. Multigenerational transmission of inherited wealth renders especially vivid the incompatibility of extreme levels of untaxed wealth with the aspiration to have a society that rewards individual industry, intelligence, or ingenuity. This problem is especially salient in countries such as the United Kingdom, which counts among its native billionaires figures such as the 7th Duke of Westminster, a twenty-nine-year-old deca-billionaire who owes his good fortune to a seventeenth-century ancestor taking possession of rural land onto which London subsequently expanded. Needless to say, given the political power of the superrich, and the way that current tax codes are designed to further their interests, the Duke managed to avoid almost all inheritance tax after coming into his fortune at the age of twenty-five, through the use of various trusts and other legal mechanisms. This kind of avoidance is more a reason to re-engineer a more effective inheritance tax system, rather than to think that we should do without it. The Duke of Westminster’s tax avoidance also points to a troublesome catch-22: the very features of wealth inequality that make it so corrosive simultaneously make it so difficult to solve. There is no magic wand; it is precisely because wealth generates political power that it is so difficult for radical progressive politicians to get elected. But even putting that obstacle aside, there remains the problem of reversibility: a future government can easily dismantle whatever a progressive government is able to achieve in reconfiguring the fiscal state. It is a daunting political project to create a significant shift in the operation of the tax system. And even if it were won, such a victory would be relatively fragile, unless other things could be changed to disperse economic and political power. That’s why the fiscal response to inequality can only be part of a broader story. Although it was defeated in the General Election of December 2019, the recent program of the British Labour Party provides a powerful template for what this kind of institutional turn in economic thinking might look like. Labour’s 2019 manifesto outlined a comprehensive vision that sees the use of the tax system as one tool among others, while also looking to strengthen the bargaining position of labor unions, reform corporate governance, and create—as a new kind of institution—“Inclusive Ownership Funds” giving workers in large firms a share in capital returns and a voice in decision making. Those kinds of deep structural changes would transform the way that the economy works day to day, rebalancing power between workers and employers. And, most importantly, these structural reforms would not be so easily reversed as changes to the tax code. Institutional changes can become part of everyday life, having the capacity to create the conditions for their own support, going beyond the fragility of overreliance on the tax system. That is why, to take a U.S. example, Bernie Sanders’s adoption of a version of the Inclusive Ownership Fund proposal is at least as important as his proposals on wealth taxation as an element of a new economic settlement. And this is also why Piketty, in his new book Capital and Ideology, sets his proposals for wealth and inheritance taxation within a broader set of proposals for creating a form of twenty-first-century “participatory socialism,” involving the reorganization of corporate governance and the creation of a new economic architecture that disperses power within economic institutions. This is not so much to criticize the work done by Zucman and Saez as to identify its important limitations: I’m sure they would agree that taxation can only do part of the work of restructuring the relations of power within our economies. But the point is that wealth inequality is more than a matter of public policy options. It is a political problem that requires a political solution—a collective political project to restructure our unequal societies. The hard work of building forms of countervailing power to stand against the power of the wealthy is a long task and one that has to be conducted at every level and in every locality. It is about building unions within workplaces, and strengthening local democratic institutions that can defend the interests of citizens over the interests of capital. It’s a struggle that necessarily must take many forms. One vital part of that larger project is to show with clarity and confidence, as Zucman and Saez do, that the fiscal system can be reconfigured to help create a more just society—that we do not need to accept dismal orthodoxies that cannot imagine an economy that breaks free of the disfiguring effects of extreme inequality.

(Liam, Law/Phil@NYU, https://www.bostonreview.net/articles/liam-murphy-how-not-argue-tax-justice/ , 10-30)

Democratic presidential candidates used to be far less comfortable about advocating higher taxes, let alone proposing an entirely new one. The dramatic transformation of America’s tax system that has brought us to this point is told in Emmanuel Saez and Gabriel Zucman’s important and accessible new book, The Triumph of Injustice. Drawing on their own technical work in economics, the authors present a detailed picture of the distribution of income and wealth in the United States over the last century, along with the history of taxation in all its forms—federal income, corporate, payroll, and estate taxes, as well as state and local income and consumption taxes. Thanks to a flurry of new economic research on inequality in recent years, the basic arc of this transformation is familiar: income and wealth inequality have increased dramatically, while marginal income and corporate taxes have fallen significantly from their highest rates. The two developments, Saez and Zucman contend, are not a coincidence. Despite all this, the book is optimistic. It is not a dispassionate, normatively neutral presentation of a set of options for policy makers to choose from; economists do not usually use words like “injustice.” This is a piece not just of policy analysis but of policy advocacy, timed no doubt for the 2020 election cycle. Some will read the book as nothing more than a how-to guide for soaking the rich. But in addition to its economic analysis, the book contains the elements of a powerful vision of economic justice. Still, there is an unfortunate mismatch between that vision and the way the authors lay out their argument. Their headline claim is that the U.S. tax system is no longer progressive: the rich no longer pay more than the rest of us, as a percentage of their income. But in tying the moral force of their advocacy so closely to the issue of the shape of the tax distribution, instead of to overall welfare outcomes, Saez and Zucman focus on the wrong question and risk playing into the hands of the market fundamentalists they oppose. The moral demands of distributive justice do not compel us to implement this or that particular form of taxation. What matters is how well the tax system promotes just outcomes, all government services considered. Progress on economic justice will not be made by pretending—even for the sake of argument—that there is an entirely separate issue of tax fairness. Instead, we must challenge head-on the market fundamentalism that insists on that, precisely in order to shut down any discussion of just welfare outcomes.