to which Max Sawicky replied:
>yup
Don't be coy, Max. What is it?
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[mbs] It's a hundred pages long, that's what it is. I'd send it to you but you haven't reacted to previous articles, including a short one along the same lines that I uploaded TO THIS VERY LIST not too long ago.
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I seem to remember Bob Pollin citing
you (back when he was advising Jerry Brown in '92) as saying that a
VAT could finance a generous welfare state, and the combined tax and
spending effects would be progressively redistributive. Is there more
to it than that?
Doug
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[mbs] I came to Brown and Pollin after the Laffer-authored flat tax had been released. I tried and failed to persuade JB to move to a progressive consumption tax. I supported JB despite his flat tax, not because of it. (at the time the main alternative was some boob from Arkansas)
In principle a progressive expenditure policy can erase the distributive effect of any tax. Nations with large public sectors, with the exception of Sweden, make heavy resort to the VAT. So sure, if the VAT is the only way to expand the public sector, it's probably worth doing.
My interest in consumption taxes began with the JB experience. It was provoked by all the lies liberals told about the flat tax (which I do not advocate). My argument about the VAT and other consumption taxes was developed after that. If I'm right about the incidence of consumption taxes, the standard social-dem argument about a larger public sector is much stronger.
mbs