Self-serving nonsense of the day, via the WSJ:
[discussing lowering US corporate tax rates]
“But that approach, some lawmakers contend, faced a basic mathematical problem, particularly on the business side: The US corporate tax rate is the highest in the developed world, and lowering it substantially would require eliminating a large number of tax breaks to avoid adding to budget deficits. That could offset any economic benefit of lower rates.”
Translation: That would cut back on those same lawmaker’s ability to favor one constituency or another, and thereby reduce their power and the utility of lobbying by special interest, which is their actual bread-and-butter. The economic benefit is not just lower rates (and certainly not lower tax revenues) – the economic benefit is efficiency, regularity, predictability, and the reduction in the value of /lobbying/. Yes, self-serving lawmakers – the benefit here is a reduction in the value of special interests paying you guys off.
Unfortunately, the media is likely going to look at any such improvements in our tax system as “ooh — lower rates for evil corporations!” so any such rational improvement in our tax code faces TWO huge obstacles – the lawmakers and the media. The only ones likely to be cheering for it are pretty much every single economist. And businesses too small to have an army of lobbyists.
Note that it’s not the WSJ coming up with the nonsense. It’s the unidentified lawmakers they are quoting. WSJ could, however, help clarify that it’s nonsense by simply publishing, next to the article, the definition of “rent-seeking” from any basic econ textbook.