In response to Robert Poole’s Wall Street Journal bit about making some aspects of our infrastructure more affordable, a couple of folks wrote Letters to the Editor.  And so I have my own response.

[A]sset recycling is not about finding more efficient ways to modernize and expand infrastructure. It’s about raising money for cash-starved treasuries….

and

The solution is to allow all states to retain the federal gas tax generated by each state.

These are only half-solutions, though, if that much. Asset recycling and other ways to find efficiency need to take the whole of spending into account, not just spending on infrastructure. Treasuries are starved for cash because the governments spend way too much. Spending needs to be cut to within revenues collected.

Along that line, there shouldn’t be any gas tax (and very few other taxes collected intrastate) sent to the Federal government for redistribution in accordance with Federal politicians’ and bureaucrats’ whims. Those monies should be retained by each State for spending on that State’s imperatives, without the friction of the (even well-meaning) middleman.

Various nations around Europe and Asia are looking at ways to add to the tax burden on multinational technology companies doing business in those nations.

Bruno Le Maire, French Minister of the Economy and Finance, rationalized the movement this way:

It is a question of fairness.

Leave it to a European politician to not understand the concept.

No. Fairness is cutting taxes, not raising them, thereby leaving more of the citizens’ money in their hands.

Fairness is cutting spending.  This would greatly reduce Government’s crowding out pressures against citizens’ businesses through competition for “customers.” This also would greatly reduce Government’s competition for inputs to production, competition which drives up the cost of those inputs to private businesses.

Fairness is cutting spending especially to be less than tax revenue, reducing the need for Government borrowing and its twin outcomes: driving up the cost of money for private businesses and increasing the likelihood of future tax increases for both the citizens and their private businesses.

And this is the Europe our very own Progressive-Democrats want us to emulate.

Professor Benjamin Harris (Kellogg School of Management) made a case for redoing our 401(k) retirement savings system.  He had several good points, too: the tax break today compared to the taxes due on withdrawal during retirement’s usually lower tax rate is irrelevant to those whose current income is low enough to go untaxed or not taxed much.  Contributions are tax deductions vs tax credits equal to a portion of contributions.  The whole system is complex from a tax-figuring perspective (what are the tax brackets in play for a particular saver, what taxes will be in play when the saver retires, how will investments perform in the interim).

Overlooked, though, is a larger alternative, even if it is a more difficult alternative to achieve.  It’s far from impossible to achieve; this year’s tax reform and cuts represent a major step in this direction.

The whole complexity of the tax question, along with most of the tax question itself, would disappear with a low, flat income tax rate.

Continuing the theme that other parts of the world still exist, this thought on Brazil’s upcoming presidential election.  In a Wall Street Journal piece about the Brazilian presidential candidates’—all 13 of them—big economic plans with no money to implement them, the item’s author offered this bit:

Mr. Bolsonaro has raised the most hopes in financial markets of tackling the endemic spending problem. …his top economic adviser, economist Paulo Guedes, has promised investors fiscal austerity….

It’s sad that “journalists,” whose interns surely know better, continue to insist that reducing government spending is somehow “austerity.” How is it austerity to leave more money in the hands of the people who earned it?  How is it austerity to leave the private economy free to spend its own money on its own imperatives instead of the Know Betters who populate government spending it for them on Know Betters’ “goals”?

Reduced government spending—and reduced tax rates, the two cannot work effectively in isolation from each other—far from being austere, allows an economy to grow.

The Brazilian government needs to get out of the way of the nation’s private economy.  Its high spending and high taxing are what constitute austerity.  Brazil’s citizens live austere lives because the government confiscates their money—to the tune of 40% of GDP—and it spends that confiscated money, not on those citizens’ wants or needs, but on government salaries and pensions, and on schools and hospitals that would be well supported and staffed in a free market economy.