"The Get America Working! approach would work, in effect, by correcting a major price distortion. The current U.S. Internal Revenue Code taxes employment far more heavily than it does the use of natural resources. This distortion has grown progressively worse as payroll taxes have grown. Revising this distortion would increase employment, equity and overall economic vigor importantly. And it would do so by responding to market price signals, not through clumsy and expensive government interventions."
Shaking the Federal Money Tree
Date:
Mon, 05/31/2010
Source:
Mother Jones
In this blog post economist Kevin Drum chastises left-leaning bloggers who want a second big stimulus arguing a tax cut would be faster and more politically viable. He suggests, as an example, a payroll tax holiday. In the repspones, one reviewer calls attentio to the Get America Working approach of a permanent payroll tax cut offset by taxes on consumption of energy and materials -- a revenue neutral tax shif that cuts costs of hiring and thus boosts employment growth.
