Sam Brownback wants to raise taxes

[IceSpear]

http://www.politico.com/story/2015/01/kansas-new-taxes-sam-brownback-114335.html?ml=po

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Looks like Brownback is the Republican version of Mark Warner/Peter Shumlin.

[🦀🎂🦀🎂]

typical tax and spend conservatives

[Ebowed]

But... the Laffer curve napkin!

[Indy Texas]

Cigarettes and liquor.

So basically he cut taxes for rich people and now that the account's overdrawn, he's going to get money to make up the difference from poor people.

[badgate]

I'd prefer a soda tax imho
and a tax on food services businesses that serve sodas in sizes larger than 24oz, so like, there's an extra 75¢ to $1.50 tacked on to larger sizes, but they can still serve them.

[🦀🎂🦀🎂]

I'd prefer a soda tax imho
and a tax on food services businesses that serve sodas in sizes larger than 24oz

oh a freedom tax, eh?

[badgate]

I'd prefer a soda tax imho
and a tax on food services businesses that serve sodas in sizes larger than 24oz

oh a freedom tax, eh?

I edited and clarified
Yes it's very freedom
such free

[ElectionsGuy]

What a jerk.

[Sprouts Farmers Market ✘]

I'd prefer a soda tax imho
and a tax on food services businesses that serve sodas in sizes larger than 24oz, so like, there's an extra 75¢ to $1.50 tacked on to larger sizes, but they can still serve them.

A. They'd get around this due to the price dropoff between 24 oz and the next size up that would inevitably result in multiple 24 oz. being bought.

B. That is extraordinarily regressive.

[Türkisblau]

Kansas is never going to pass a soda tax if SF won't even do it.

The Brownback as governor saga has been both hilarious and sad at the same time.

[Simfan34]

Wow, look at all those anti-tax Democrats. Good on Brownback.

[Türkisblau]

Wow, look at all those anti-tax Democrats. Good on Brownback.

They're not anti-tax; they're anti-regressive tax which is entirely sensible.

[DC Al Fine]

But... the Laffer curve napkin!

The Laffer curve is correct, its just that most American jurisdictions are on the left side of the curve.

[DrScholl]

Kansas gets exactly what it voted for. Although, those same voters will probably somehow blame Obama for the tax increases.

[J-Mann]

Kansas gets exactly what it voted for. Although, those same voters will probably somehow blame Obama for the tax increases.

This is undoubtedly true. The average Kansan isn't paying enough attention to reality outside of a campaign season and historically has not been able to differentiate between types of taxes and from where they were raised or lowered. During the next gubernatorial election here, the cry will be, "Our taxes are too high," with no regard to which ones and how regressive the state's system has become.

[free my dawg]

I'd prefer a soda tax imho
and a tax on food services businesses that serve sodas in sizes larger than 24oz, so like, there's an extra 75¢ to $1.50 tacked on to larger sizes, but they can still serve them.

nah dawg

[Miles]

This guy is a sick puppy.

[badgate]

Well aren't y'all a bunch of negative Nancys

[Landslide Lyndon]

Thank God the good people of Kansas didn't choose that tax-loving liberal Davis and reelected that Grover Norquist acolyte Sam Brownback.

[Antonio the Sixth]

That makes perfect sense. He cut direct taxes that targeted the wealthy and now raises indirect taxes that hurt the poor and the middle class. Remember that the GOP's ultimate goal isn't to cut taxes, but rather to wage class warfare in favor of the 1%.

[SUSAN CRUSHBONE]

0bamunist liberal governor REDback will get what's coming to him in the next elections

[SWE]

How can we afford to cut taxes for rich people if we don't raise them for poor people?

[muon2]

But... the Laffer curve napkin!

The Laffer curve is correct, its just that most American jurisdictions are on the left side of the curve.

I've never seen explanation of the Laffer curve that acknowledges the income effect. That's a glaring oversight.

Like many basic economic models the Laffer curve does not take into account multivariate features of the economy. That doesn't invalidate it, it just limits its predictive power. The curve itself long predates Laffer and he attributed it to the medieval Islamic scholar Ibn Khaldun (who incidentally was a student of the works of Ibn Rushd).

The curve is based on two theorems and one economic assumption. The first theorem is that if the tax rate is zero then revenue will be zero. The second is that if a function is continuous and positive, then it reaches a maximum between two points where the function is zero. The economic assumption is that as taxation rises, people will change their economic behavior to reduce their activity that generates the tax (This is the principle argument given in favor of raising cigarette taxes - it encourages people to cut back on smoking.) The corollary to this assumption is that if the tax rate is 100% then people will completely avoid that activity since they would get no value from it. The logical conclusion from the assumption is that there is a tax rate less than 100% that generates maximum revenue.

The problem is that when there are multiple methods of taxation then calculation of that point of maximum revenue becomes difficult. It is almost certainly the case that the revenue rate curve is not symmetric and may have more than one peak. Another problem is that consumption taxes (like the sales tax) don't confiscate the good or service so there is always some value and the 100% point isn't reached for that tax.

[Torie]

Muon2, your post did not communicate much. It was mostly jargon. We do know that a zero tax generates no revenue, and a 100% tax generates next to none. It is what in-between that matters, and the elasticity of how assiduously  folks will endeavor to change their behavior/financial transactions to avoid taxes, and how much their amount of toil will truncate as marginal tax rates increase (yes maybe it will increase at certain points in the formula to get enough net income to meet basic needs - one will work very hard working at a 90% marginal tax rate to avoid the alternative of starvation - good recipe for revolution that one), and the particular economic environment matters also - if not working at all means starvation (so the robustness of the social safety net works into the formula too). And you know what? I don't think anybody really knows. Just like nobody really knows, how much of the corporate income tax morphs into higher prices of goods, and how much is really a tax on capital. If somebody really does, they should give me a call.

The lack of a good and reliable data base of course is what fuels ideological rhetoric. Absent hard data, folks have more space to assume what fits within what they wish to believe, to effect a better fit between their ideology and reality. Who knew?

[muon2]

Muon2, your post did not communicate much. It was mostly jargon. We do know that a zero tax generates no revenue, and a 100% tax generates next to none. It is what in-between that matters, and the elasticity of how assiduously  folks will endeavor to change their behavior/financial transactions to avoid taxes, and how much their amount of toil will truncate as marginal tax rates increase (yes maybe it will increase at certain points in the formula to get enough net income to meet basic needs - one will work very hard working at a 90% marginal tax rate to avoid the alternative of starvation - good recipe for revolution that one), and the particular economic environment matters also - if not working at all means starvation (so the robustness of the social safety net works into the formula too). And you know what? I don't think anybody really knows. Just like nobody really knows, how much of the corporate income tax morphs into higher prices of goods, and how much is really a tax on capital. If somebody really does, they should give me a call.

The lack of a good and reliable data base of course is what fuels ideological rhetoric. Absent hard data, folks have more space to assume what fits within what they wish to believe, to effect a better fit between their ideology and reality. Who knew?

I admit a dry response, but I'm weary of years of attacks on the Laffer curve, simply because it was glommed onto by the architects of Reaganomics. It's as basic as a supply-demand curve. It's also easy to prove its validity in the simple case with very few assumptions, do I did. There are academic papers that show the ideal rate should be 30% and others that say 70%. Just like a supply-demand curve the optimal point shifts depending on how many factors one wants to include. As I noted sales taxes don't fit the assumptions of the curve, so there is no optimal rate for Brownback to set on cigarettes and liquor.