[rmnka447]

ggwhiz, on 2016-December-13, 13:01, said:

I'm not an American but am very interested in the confirmation process and know nothing about it.

What's the timeline? It seems that a few of Trumps nominees might not pass the smell test. Sessions for AG? Who else?

The confirmation is made by a majority vote of the Senate. The process is required for Cabinet members and certain other high ranking members of the government.

Typically what happens is the President nominates individuals for the posts, then the nominees go through a hearing or hearings with the appropriate Senate committee(s). The committee makes a recommendation on the nominee to the Senate and then the Senate votes to confirm or not. The length of the hearings and timing of the Senate vote is entirely up to the Senate.

In the past, the minority was ultimately able to use the filibuster to prevent a nominee from coming up for a vote. (A filibuster is an ongoing 24 hour a day speech by a Senator [or group to Senators] to stop Senate business by retaining the floor. It can only be stopped by a vote of cloture which requires 60 votes.) However, the last time the Democrats had control of the Senate, they changed the Senate rules over the vociferous objections of the Republicans to eliminate filibusters for nominees to be able to always bring these nominees up for a vote. This "nuclear option" is now available to Republicans. The nuclear option is, however, not available for nominees to the Federal Judiciary (including the Supreme Court) as these are lifetime appointments and it is felt that there should be substantial agreement for confirmation.

[rmnka447]

kenberg, on 2016-December-13, 11:33, said:

I am often not fond of Krugman and this is no exception, but I agree that the question now is what to do. I think much of the Democratic leadership is still in the denial stage.
What to do?

1. The election is over. Krugman accepts this, not everyone does. The recount effort, by Stein or by anyone, was misguided. Suggesting that electors in the Electoral College could be swayed is a very bad idea. It's over. Donald Trump takes office in January.

2. Putin/Comey???? I really hope Krugman can tell the difference between Putin and Comey, both the men themselves and their actions. Clinton's inability to deal effectively with the email problem cast doubt on her skills. Problems with Putin are another thing entirely. Putin and Comey should not be joined by a /, they should not be joined at all.

3. The dispute over Russian motivation that the FBI and the CIA seem to be having. It is always difficult to conclusively prove motivation, but it is reasonable to assume that people intend the consequences of their actions, especially when the actions require effort and planning. The thing to do is to get the fullest possible picture of what happened. And then address it. Reasonable people will make reasonable conclusions about motivation, but focus on what happened and how to stop it from happening. This relates back to point 1. Democrats should be very clear that the election is a settled matter. It could then be the case that Republicans and Democrats could work together in addressing this very serious problem. It is my understanding that more than a few Republicans would be interested in a joint approach.

4. The election was not illegitimate. It was, in my view, a disaster. But it was not illegitimate. Maybe this should be point 1.

We may differ on our views of the outcome of the election, but I can agree with your views regarding the election as outlined in your points here.

[y66]

hrothgar, on 2016-December-13, 13:27, said:

The following article is very interesting,

http://www.nytimes.c...l?smid=fb-share

If Trump is actually pushing something like this [taxing goods where they are consumed rather than where they were produced] I'd need to re-evaluate some of my pre-conceived notions

fyp

If we end up with something along the lines Auerbach is proposing vs yet another giant corporate tax cut, I will be very happy to tweet a note of appreciation to our new president.

[mikeh]

hrothgar, on 2016-December-13, 13:27, said:

The following article is very interesting,

http://www.nytimes.c...l?smid=fb-share

If Trump is actually pushing something like this I'd need to re-evaluate some of my pre-conceived notions

How this would get past the WTO is pretty much impossible to see. The analogy to VAT seems inapt, tho I am far from an economist. VAT has the consumer paying taxes on purchases, which is a direct consumption tax that, if imposed across all goods and services, is a boon to the rich and runs counter to the idea of a progressive tax system. Given that the poor and the middle income classes have to spend much of their income on necessities, while the rich get to invest and save and use their money to make money, this sort of tax is a terrible idea unless, of course, you believe that being born rich makes one a far better person, and far more entitled, than being born poor does. So much for all being created equal or any further pretense at equality of opportunity.

This can be adjusted for by exempting necessities from tax, but then the system becomes complex and prone to distortion and the effects of lobbying, just like the present one.

Meanwhile, with US exporters able to lower their export prices and still increase profit, what do we think other countries will do, to protect their industries? How do we spell trade war?

Other countries would either follow suit or (and this seems to me probable because it is quick and easy to enact) impose tariffs that would nullify the US exporters advantage. Ok, where, then, is the benefit to the US? Their exports don't grow, because of tariffs, and the tax revenue vanishes. So the owners continue to get rich while the government starves. Sounds very randian to me, Something Ryan would love. His sponsors get rich, while he can deplore the weak nature of those who do not triumph from an act of will.

I suspect I have missed something basic, since surely these high-powered economists have thought about this tariff response?

[awm]

mikeh, on 2016-December-13, 22:36, said:

I suspect I have missed something basic, since surely these high-powered economists have thought about this tariff response?

There are basically two ways that companies are taxed:

1. On their profits, by the country where they are based.
2. On their sales, by the country where they sell.

There are various ways to implement each of these two forms of taxation. The problem is that companies have gotten very skilled at avoiding the first type of tax by relocating or simply ascribing their profits to an overseas division in a low-tax country. It's much more difficult to play these sorts of games with sales, since there is more of a record of the economic activity, and in fact companies typically pay the tax on sales (okay many of the costs are passed to consumers) even in countries with high VAT.

The idea is that the high level of avoidance of tax on profits is generally bad for the countries that rely heavily on such tax (i.e. the US). It creates incentive for companies to move overseas, or at least to keep their profits overseas rather than repatriating them, reduces government revenue, and effectively penalizes small companies without overseas offices. So the idea is that the US should reduce or eliminate the tax on profits while increasing the tax on sales to replace the revenue. Other countries already do this to some extent (like most of Europe, with fairly high rates of VAT and much lower corporate income tax). Note that this is not a tariff, because it's also applied to domestic companies. However, the domestic companies should at least break even because of the reduced tax on profits, whereas foreign companies were not paying tax on profits to the US government anyway. The exact mechanism may well fall afoul of trade agreements, but again many European countries effectively do the same thing so it's probably possible to work around.

There are definitely issues because the sales tax is regressive (hits poor people harder), but some of this can potentially be worked around by removing this tax on necessities and raising it on luxury items, and by raising the capital gains tax (since a big justification for this tax is "double taxation" on profits and dividends which would go away in this structure).

[mikeh]

awm, on 2016-December-13, 23:57, said:

There are definitely issues because the sales tax is regressive (hits poor people harder), but some of this can potentially be worked around by removing this tax on necessities and raising it on luxury items, and by raising the capital gains tax (since a big justification for this tax is "double taxation" on profits and dividends which would go away in this structure).

Yes. I can certainly see the republican congress enacting a significant capital gains tax. Oh yes, I can. But, then again, I can see a pig flying by.

Actually, the scariest part of this idea is that one of the justifications from an economic point of view appears to be lowering the corporate tax rate and eliminating interest deductibility, which especially hurts real estate developers. So, what are the odds that Trump will require that interest deductions remain in place? Anyone here think he might sign into law anything that costs him a nickel? But lower tax rates AND interest deductibility? Now we're talking a republican wet dream.

[alok c]

Lowering of taxes for Goods meant for export & increasing import tariff if it is feasible at all under current WTO is a measure for protectionism.Other countries can take legitimate counter measures e.g anti dumping duties,high import tariff,export subsidies,high income tax of such importers,dual taxation on overseas office,artificial devaluation of currency(what China did earlier) etc.It is a very complex issue having a very wide ramification which can not be described by a single brush stroke.History teaches that protectionism always fails in the long run.
Now for VAT(Value added tax)-In gist,it is a progressive taxing system compared to old sales tax.It is generally having different slabs for different types of goods &services.Essential goods(both natural & artificial) which generally have less or no value addition in different stages of completion attract lowest VAT on both counts(lowest slab,least value addition per stage).Luxury goods on the other hand attract highest VAT.VAT also eliminate different sales tax in different constituent states thereby bringing uniformity in pricing across the country.This is the broad outline, lots of other details are involved.

[hrothgar]

[awm]

mikeh, on 2016-December-14, 00:58, said:

Yes. I can certainly see the republican congress enacting a significant capital gains tax. Oh yes, I can. But, then again, I can see a pig flying by.

Actually, the scariest part of this idea is that one of the justifications from an economic point of view appears to be lowering the corporate tax rate and eliminating interest deductibility, which especially hurts real estate developers. So, what are the odds that Trump will require that interest deductions remain in place? Anyone here think he might sign into law anything that costs him a nickel? But lower tax rates AND interest deductibility? Now we're talking a republican wet dream.

Our corporate tax system in the US is really broken -- we have a system where the rate "on the books" is really high, but large companies rarely pay anything near that. The total revenue raised from corporations has been falling for years, companies with big negative impacts on the environment or public health actually tend to pay lower taxes (big deductions for oil and coal extraction, for example), companies get tax benefits for moving overseas, etc. I'm sure there are many economists proposing logical ways to fix it.

But I agree with you that the current administration is much more likely to pick the pieces of a proposal which they like and then use the economist for "cover" than to actually implement such a proposal correctly. Just like how they want to repeal Obamacare but keep the part about pre-existing conditions (which breaks the whole thing because that and the mandate go hand in hand).

[Winstonm]

awm, on 2016-December-14, 10:36, said:

Our corporate tax system in the US is really broken -- we have a system where the rate "on the books" is really high, but large companies rarely pay anything near that. The total revenue raised from corporations has been falling for years, companies with big negative impacts on the environment or public health actually tend to pay lower taxes (big deductions for oil and coal extraction, for example), companies get tax benefits for moving overseas, etc. I'm sure there are many economists proposing logical ways to fix it.

But I agree with you that the current administration is much more likely to pick the pieces of a proposal which they like and then use the economist for "cover" than to actually implement such a proposal correctly. Just like how they want to repeal Obamacare but keep the part about pre-existing conditions (which breaks the whole thing because that and the mandate go hand in hand).

From my reading, the corporate tax rate is only slightly higher than the world average but the effective rate is the lowest in the world.

[jogs]

awm, on 2016-December-14, 10:36, said:

Just like how they want to repeal Obamacare but keep the part about pre-existing conditions (which breaks the whole thing because that and the mandate go hand in hand).

The entire insurance model for healthcare makes no sense. With auto insurance when you file a claim the insurance company raises your rates. No way should the govt force insurance companies to take a lost for people with pre-existing conditions. The govt must find a way for those people to receive treatments at a wholesale price.

[mike777]

When many so many large or semi large corporations have owners who live around the world it must be difficult to know which country is owed a priority moral duty or sense of loyalty.


A headquarters may be no more than a mailbox address.

[jogs]

Winstonm, on 2016-December-14, 16:35, said:

From my reading, the corporate tax rate is only slightly higher than the world average but the effective rate is the lowest in the world.

Small businesses are paying the high corporate tax rate.

[mike777]

jogs, on 2016-December-14, 18:12, said:

The entire insurance model for healthcare makes no sense. With auto insurance when you file a claim the insurance company raises your rates. No way should the govt force insurance companies to take a lost for people with pre-existing conditions. The govt must find a way for those people to receive treatments at a wholesale price.

Do you suggest that government set prices to control healthcare costs? Please keep in mind healthcare is more much more than your doctor or nurse.


A mistake a big mistake people make is thinking healthcare is just your doctor, not the cost of the janitor or the paying for the lights.

[jogs]

Govt setting prices? Isn't that single payer? Why is every pill once a day at over $100 a month? If some one discovers a pill which only needs to be taken once a month, does the drug companies suppress this finding? I favor no insurance for most healthcare needs. Free market. Prices for Lasik surgery and boob jobs have actually gone down. Insurance doesn't cover those procedures.

[Winstonm]

jogs, on 2016-December-14, 18:14, said:

Small businesses are paying the high corporate tax rate.

That would not surprise me.

[kenberg]

jogs, on 2016-December-14, 18:14, said:

Small businesses are paying the high corporate tax rate.

Echoing Winston, no surprise. And this bothers me a lot. My father, I suppose, ran a small business. He installed weather stripping but he did it not for a salary but on a contractual basis. Sometimes with home owners, sometimes with construction companies. Sometimes he hired assistance. Starting from when I was 14, I handled the taxes and it was fairly complex. Neither my father nor I had any interest in being clever, we wanted it done and we wanted no trouble with the IRS. Partly this was personality, but also the amount of money was such that it would have been idiocy to get cute. Small gain, high risk. But with big business? The amounts are huge and you don't have a 14 year old dealing with it. The folks handing the taxes are well educated and very clever.


It's not right. It really is not right. And I don't think it's so good for the country either.

[Kaitlyn S]

jogs, on 2016-December-14, 18:14, said:

Small businesses are paying the high corporate tax rate.

How do you fix this? If you tax companies with more employees higher, you give incentives for having robots rather than employees, causing higher unemployment.

If you have a progressive corporate tax rate, you ģive incentive to split companies, making them less efficient and less competitive vs foreign companies, as well as making it easier to dodge quotas. Making them less competitive will have the net effect of higher unemployment.

[kenberg]

The goal should be to reduce the role of tax lawyers. It's fine to have a firm do the taxes with the aim of getting it right but that, I think, is now a minor part of the job. A person does not have to have a very complicated financial life to soon find himself/herself immersed in all sorts of crap. Our president-elect, who does have a complicated financial life, apparently has ongoing negotiations with the IRS as part of his regular business practice. Large corporations can afford this, small businesses cannot. And it distorts business decisions. Instead of asking "How will this help the product" the question becomes "How will this affect the taxes?" What is legal and what isn't gets murky, and even when legal the decision process is distorted. The big guys get breaks that the small business never heard of or has no chance of taking advantage of.

It is screwed up.

[rmnka447]

jogs, on 2016-December-14, 18:12, said:

The entire insurance model for healthcare makes no sense. With auto insurance when you file a claim the insurance company raises your rates. No way should the govt force insurance companies to take a lost for people with pre-existing conditions. The govt must find a way for those people to receive treatments at a wholesale price.

The problem with Obamacare was that the pre-existing condition folks had to be offset by a group that is only a fraction of the whole healthcare pool.

I suspect that ultimately the solution is to spread the cost of the pre-existing condition folks across the whole healthcare pool. In effect, everyone would have to agree to a "tax" increase in the form of higher health care plan costs to employers and employees. It won't be an easy sell to everyone especially if the cost has a negative impact on their healthcare plan such as reduction in benefits, loss of employer plan, etc..