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The Munk Debates
هل يجب زيادة الضرائب علي الاغنياء ؟ مناظرة مونك عن عدم المساواة الاقتصادية
في وقت تشهد فيه دخول أفراد الطبقة المتوسطة في الاقتصادات المتقدمة حالة من الركود بينما تزداد بشكل ملحوظ دخول الاغنياء، اقيمت مناظرة بين أنصار إعادة توزيع الثروة بول كروغمان وجورج باباندريو ضد نيوت غينغريتش وآرثر لافر ليتناظروا حول الضرائب – هل ينبغي أن يدفع الأغنياء أكثر؟ بالنسبة للبعض فأن الجواب واضح: فان إعادة توزيع ثروات ذوي الدخول الأعلى الذين استحوذوا، قرابة جيل، على نصيب الأسد من كل مكاسب الدخول أفضل وسيلة لبلدان مثل كندا لإعادة الاستثمار في شبكات الضمان الاجتماعي، والتعليم، والبنية التحتية مع حماية الطبقة الوسطى. بينما يرى آخرون أن النمو الاقتصادي الهزيل، وليس عدم المساواة في الدخول، هي المشكلة الحقيقية التي تواجه الدول المتقدمة. في ظل اقتصاديات العولمة، أن رفع الضرائب على مصنعي ثروات المجتمع سيؤدي إلى هروب رأس المال، وانخفاض الإيرادات الحكومية، ما يعني اموال اقل للفقراء. ان هذه السلسلة الرائدة من المناظرات حول عدم المساواة الاقتصادية تعالج قضية سياسات عامة أساسية: هل يجب زيادة الضرائب على الأغنياء؟
- GenresNonfiction
120 pages, Paperback
First published November 2, 2013
106 people want to read
About the author
George Papandreou
5 booksGeorge Andreas Papandreou is a Greek politician who served as Prime Minister of Greece from 2009 to 2011.
Belonging to a political dynasty of long standing, he served under his father, then-prime minister Andreas Papandreou as Minister for National Education and Religious Affairs (1988–1989 and 1994–1996) and Minister for Foreign Affairs from 1999 to 2004. Papandreou was leader of the Panhellenic Socialist Movement (PASOK) party from February 2004 until March 2012, and President of the Socialist International since January 2006.
On 6 October 2009, Papandreou became the 182nd Prime Minister of Greece. He was the third member of the Papandreou family to serve as the country's prime minister, following his father Andreas and his grandfather Georgios Papandreou. He resigned on 11 November 2011 during the Greek government debt crisis to make way for a national unity government.
Belonging to a political dynasty of long standing, he served under his father, then-prime minister Andreas Papandreou as Minister for National Education and Religious Affairs (1988–1989 and 1994–1996) and Minister for Foreign Affairs from 1999 to 2004. Papandreou was leader of the Panhellenic Socialist Movement (PASOK) party from February 2004 until March 2012, and President of the Socialist International since January 2006.
On 6 October 2009, Papandreou became the 182nd Prime Minister of Greece. He was the third member of the Papandreou family to serve as the country's prime minister, following his father Andreas and his grandfather Georgios Papandreou. He resigned on 11 November 2011 during the Greek government debt crisis to make way for a national unity government.
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February 13, 2014
The Munk Debate on Economic Inequality “Should We Tax the Rich More” is an excellent book and in my view should be considered requisite reading for all Western citizens.
The debate took place between Paul Krugman (a Nobel Prize Winner in Economics; New York Times author) and George Papandreou (former Prime Minister of Greece; considered a Top 100 Global Thinker by ‘Foreign Policy’ magazine) on one side (pro) versus Newt Gingrich (former Speakers of the U.S. House of Representatives; candidate for the Republican Party nomination for President) and Arthur Laffer (key economics advisor for Ronald Reagan; “father” of supply-side economics) on the other.
There is only one drawback to this book and that is Newt Gingrich. Any debate of substance took place between Krugman, Papandreou and Laffer but I found the responses from Gingrich weak or perhaps this was just a general reflection of the weaknesses in this side of the argument.
Despite being on the same team there was little agreement between Gingrich and Laffer. In response to the resolution “Should We Tax the Rich More” Laffer contended that “yes we should” but not by increasing top marginal rates. Laffer’s solution was “total tax reform”—the elimination of deductions, exemptions and exclusions (tax loopholes), and in its place, the implementation of a flat tax but one lower than current rates. In essence, Laffer suggested we broaden the tax base and simplify the processes used to file and enforce taxes which would force the ultra-wealthy to pay their taxes (anyone earning an annual income over $1 million) while reducing the transaction costs of accountants, lawyers and government officials. Gingrich, on the other hand, doesn’t believe “any” additional taxes should be levied on the wealthy, and that, if anything, top tax rates should be lowered.
From the outset of the debate it was clear that Laffer was more credible and reasonable than Gingrich. Laffer’s primary contribution to economics was the development of the “Laffer Curve”, the supposition that lower tax rates can stimulate government revenues by increasing economic output. And as one that presided over the actual implementation of his theories throughout a presidential administration, he was able to provide examples of trends within the data to support his claims whereas Gingrich relied on making ideological statements that were largely unsupported. Instead of directly responding to the challenges posed he would reframe the question as if that somehow justified his change of topic. Laffer stuck to the questions and counters at hand.
After analyzing this debate, I am mystified that Gingrich posits himself an intellectual. Gingrich attempted to rely solely on, what was supposed to be, a moral argument for not raising taxes. He framed taxation as “coercion” and claimed that progressive taxation amounts to “confiscation” that punishes success and thereby discourages investment and innovation. But here is the hole in his logic: Do you think innovators like Bill Gates wouldn’t have done what they did depending on whatever top marginal tax rates happened to exist at the time? It is doubtful whether this was considered during the earliest stages of entrepreneurship and $1 billion was likely incentive enough relative to what most entrepreneurs have in the beginning, which is nothing. It is hard to believe any of these people would have said, “No. I’m not doing anything unless I am able to make $44 billion or more”. The contention that they would have is just arbitrarily stupid and conflicts with the evidence presented by Krugman.
Another purported disincentive was “capital flight”. The notion that raising taxes on corporations will chase them out of the country leading to a loss of employment and government revenue. Yet, according to Krugman, this rarely happens despite the ongoing threat, and in cases where it has happened, the case should be made to develop an international tax and regulatory regime to prevent this cyclical “race-to-the-bottom”. After completely ignoring this possibility, Gingrich suggested a race-to-the-bottom is inevitable despite how this cycle exacerbates inequality, undermines political stability and ultimately the ability of Western states to compete successfully over the longer term.
It was as though Gingrich has never understood why state developers (the economists and politicians responsible for developing post-war states) ever adopted progressive taxation in the first place. It was adopted as one method of creating a political and economic balance of interests between capital (business) and labour (everyone else), the top of which would help pay for investments in public services at the bottom to A. harness the economic potential of the working class (which soon became “middle”), to B. reduce costs to the welfare state and C. to ensure stability and a free flow of commerce within and between capitalist states. In other words, progressive taxation was designed to sustain the longer-term interests of capital by providing business with a consistently functional state in which to operate.
It is likely that none of these points would have registered with Gingrich given how set he was in appealing to the base sensibilities and historical prejudice of the American people. In his view, the government is evil and dysfunctional, a true throwback to colonial times.
Another disappointment was Gingrich and Laffer’s secondary rationale for not raising tax rates: The rich simply won’t pay them. Both of them claimed that the rich will find ways to avoid higher taxes and that rates should settle in accordance with what levels the rich are willing to tolerate to ensure compliance.
This is completely nonsensical and lacking in balls.
Firstly, it infers that the rich are beyond the law when compliance is simply a matter of political will. Secondly, at what point will the wealthy collectively agree on what rate to pay? Presumably they will reach agreement when the rate is “zero”.
When questioned on how he would address inequality, Gingrich stated “more jobs” through a “good economy”. This too makes no sense when considering the original question. The premise of the debate is whether we should raise top marginal rates on the rich because inequality is widening which undermines the progressive taxation arrangements of the social contracts we have between capital and labour. So ultimately, the point is, how do we address inequality?
If Gingrich had half-a-brain, he would recognize that all economies experience cyclical peaks and troughs, and that the peaks we’ve experienced have not been enough to reverse inequality trends. In other words, Gingrich’s solution amounts to an idealistic, improbable and inefficient “non-solution”. The cherry-on-top was when Howard Green tells Gingrich that real wages have not gone up in 30 years, to which Gingrich responds, “but they will”. And this is how he supports his positions. By saying that things will improve even though what he is advocating has been implemented for the last 30 years and has yielded the opposite result, a claim made even less reasonable with heightened global competition.
If I were to give Gingrich at least one scrap of credit it would be his questioning of the use of public resources. I believe he is correct in stating that participants in public bureaucracies are provided with few incentives to be efficient and even fewer to be innovative. As such, bureaucracies have grown in size and in price relative to the services provided. But because bureaucracies have failed to address these problems internally (in the absence of market discipline there is no sanction-based incentive to do so), market reform (quasi-privatization) is often promoted as the solution by outside stakeholders such as Gingrich. His theory is that if discipline is imposed, citizens can far more services for far less money from public services, and the money saved can be reinvested back in the system.
On the “for” side of the debate, Papandreou advocated for Social Justice but relied primarily on emotional appeal (moral relativity) to support his points. He was however able to provide first-hand experience of having presided over a financial crisis. For example, Papandreou was able to clarify the origin of the Greek crisis. In the mainstream media, pundits contended that the crisis was caused by greedy workers who have bloated public contracts and greedy citizens who loaf on the excesses of the welfare state. Papandreou mentions none of this. Conversely, Papandreou contended that public policies have been disproportionately benefiting the ultra-wealthy over time which led to a grossly disproportionate level of wealth to accumulate in the hands of few who used their accruing power to block any policy changes that could lead to more progressive taxation or redistribution. Papandreou also made clear how, in the aggregate, more equal societies perform better in education, healthcare, life expectancy, environment, and are generally happier and among the most competitive economies.
Krugman was easily the strongest presenter and provided most of the consensus-based research and political economy rationales for taking specific actions moving forward. For example, at the time of this debate, Krugman claimed the Republicans were in the process of eliminating $2 billion dollars from the food stamps program (considered one of the most efficient bureaucracies) when the need for this cut could be eliminated by increasing the top marginal tax rate by one-seventh of 1%. Whether with respect to his reasoning, the data he provides to support his claims, or his clear understanding of the origin and implications of inequality trends, Krugman’s dominance throughout the debate was obvious but the points of agreement between all members are most worth considering.
Papandreou, Laffer and Krugman each understood the political and economic rationales for creating a balance of public policy interests between capital and labour, and on the need for total tax reform. The only disagreed on the processes used to achieve these goals. And if governments ever decide to proceed with either direction alone, that will be progress.
They all felt tax loopholes should be closed but Laffer felt flat taxation should also be adopted and lowered relative to the progressive tax brackets levied now. Krugman found the lower flat tax solution laughable and claimed the optimal top marginal tax rate is 73% as compared with a current average of 40% in Western states. It is thereby not surprising why France recently raised their rate to 73% which is still 14% less than the top rates that were implemented at the outset of the post-war era.
Papandreou proposed that closing loopholes successfully will require the development of an international regulation regime to ensure capital maintains their responsibilities to their domestic social contracts and to prevent them from following through on their threats of capital flight. Once this is achieved, the resulting surplus could be used to enhance each country’s soft and hard infrastructures such as education, research and transport systems (etc.) to enhance their competitiveness, to name just a few examples.
Gingrich was an abject disappointment; Krugman, a breath of fresh air.
5 out of 5 stars for this Munk Debate! Check it out!
The debate took place between Paul Krugman (a Nobel Prize Winner in Economics; New York Times author) and George Papandreou (former Prime Minister of Greece; considered a Top 100 Global Thinker by ‘Foreign Policy’ magazine) on one side (pro) versus Newt Gingrich (former Speakers of the U.S. House of Representatives; candidate for the Republican Party nomination for President) and Arthur Laffer (key economics advisor for Ronald Reagan; “father” of supply-side economics) on the other.
There is only one drawback to this book and that is Newt Gingrich. Any debate of substance took place between Krugman, Papandreou and Laffer but I found the responses from Gingrich weak or perhaps this was just a general reflection of the weaknesses in this side of the argument.
Despite being on the same team there was little agreement between Gingrich and Laffer. In response to the resolution “Should We Tax the Rich More” Laffer contended that “yes we should” but not by increasing top marginal rates. Laffer’s solution was “total tax reform”—the elimination of deductions, exemptions and exclusions (tax loopholes), and in its place, the implementation of a flat tax but one lower than current rates. In essence, Laffer suggested we broaden the tax base and simplify the processes used to file and enforce taxes which would force the ultra-wealthy to pay their taxes (anyone earning an annual income over $1 million) while reducing the transaction costs of accountants, lawyers and government officials. Gingrich, on the other hand, doesn’t believe “any” additional taxes should be levied on the wealthy, and that, if anything, top tax rates should be lowered.
From the outset of the debate it was clear that Laffer was more credible and reasonable than Gingrich. Laffer’s primary contribution to economics was the development of the “Laffer Curve”, the supposition that lower tax rates can stimulate government revenues by increasing economic output. And as one that presided over the actual implementation of his theories throughout a presidential administration, he was able to provide examples of trends within the data to support his claims whereas Gingrich relied on making ideological statements that were largely unsupported. Instead of directly responding to the challenges posed he would reframe the question as if that somehow justified his change of topic. Laffer stuck to the questions and counters at hand.
After analyzing this debate, I am mystified that Gingrich posits himself an intellectual. Gingrich attempted to rely solely on, what was supposed to be, a moral argument for not raising taxes. He framed taxation as “coercion” and claimed that progressive taxation amounts to “confiscation” that punishes success and thereby discourages investment and innovation. But here is the hole in his logic: Do you think innovators like Bill Gates wouldn’t have done what they did depending on whatever top marginal tax rates happened to exist at the time? It is doubtful whether this was considered during the earliest stages of entrepreneurship and $1 billion was likely incentive enough relative to what most entrepreneurs have in the beginning, which is nothing. It is hard to believe any of these people would have said, “No. I’m not doing anything unless I am able to make $44 billion or more”. The contention that they would have is just arbitrarily stupid and conflicts with the evidence presented by Krugman.
Another purported disincentive was “capital flight”. The notion that raising taxes on corporations will chase them out of the country leading to a loss of employment and government revenue. Yet, according to Krugman, this rarely happens despite the ongoing threat, and in cases where it has happened, the case should be made to develop an international tax and regulatory regime to prevent this cyclical “race-to-the-bottom”. After completely ignoring this possibility, Gingrich suggested a race-to-the-bottom is inevitable despite how this cycle exacerbates inequality, undermines political stability and ultimately the ability of Western states to compete successfully over the longer term.
It was as though Gingrich has never understood why state developers (the economists and politicians responsible for developing post-war states) ever adopted progressive taxation in the first place. It was adopted as one method of creating a political and economic balance of interests between capital (business) and labour (everyone else), the top of which would help pay for investments in public services at the bottom to A. harness the economic potential of the working class (which soon became “middle”), to B. reduce costs to the welfare state and C. to ensure stability and a free flow of commerce within and between capitalist states. In other words, progressive taxation was designed to sustain the longer-term interests of capital by providing business with a consistently functional state in which to operate.
It is likely that none of these points would have registered with Gingrich given how set he was in appealing to the base sensibilities and historical prejudice of the American people. In his view, the government is evil and dysfunctional, a true throwback to colonial times.
Another disappointment was Gingrich and Laffer’s secondary rationale for not raising tax rates: The rich simply won’t pay them. Both of them claimed that the rich will find ways to avoid higher taxes and that rates should settle in accordance with what levels the rich are willing to tolerate to ensure compliance.
This is completely nonsensical and lacking in balls.
Firstly, it infers that the rich are beyond the law when compliance is simply a matter of political will. Secondly, at what point will the wealthy collectively agree on what rate to pay? Presumably they will reach agreement when the rate is “zero”.
When questioned on how he would address inequality, Gingrich stated “more jobs” through a “good economy”. This too makes no sense when considering the original question. The premise of the debate is whether we should raise top marginal rates on the rich because inequality is widening which undermines the progressive taxation arrangements of the social contracts we have between capital and labour. So ultimately, the point is, how do we address inequality?
If Gingrich had half-a-brain, he would recognize that all economies experience cyclical peaks and troughs, and that the peaks we’ve experienced have not been enough to reverse inequality trends. In other words, Gingrich’s solution amounts to an idealistic, improbable and inefficient “non-solution”. The cherry-on-top was when Howard Green tells Gingrich that real wages have not gone up in 30 years, to which Gingrich responds, “but they will”. And this is how he supports his positions. By saying that things will improve even though what he is advocating has been implemented for the last 30 years and has yielded the opposite result, a claim made even less reasonable with heightened global competition.
If I were to give Gingrich at least one scrap of credit it would be his questioning of the use of public resources. I believe he is correct in stating that participants in public bureaucracies are provided with few incentives to be efficient and even fewer to be innovative. As such, bureaucracies have grown in size and in price relative to the services provided. But because bureaucracies have failed to address these problems internally (in the absence of market discipline there is no sanction-based incentive to do so), market reform (quasi-privatization) is often promoted as the solution by outside stakeholders such as Gingrich. His theory is that if discipline is imposed, citizens can far more services for far less money from public services, and the money saved can be reinvested back in the system.
On the “for” side of the debate, Papandreou advocated for Social Justice but relied primarily on emotional appeal (moral relativity) to support his points. He was however able to provide first-hand experience of having presided over a financial crisis. For example, Papandreou was able to clarify the origin of the Greek crisis. In the mainstream media, pundits contended that the crisis was caused by greedy workers who have bloated public contracts and greedy citizens who loaf on the excesses of the welfare state. Papandreou mentions none of this. Conversely, Papandreou contended that public policies have been disproportionately benefiting the ultra-wealthy over time which led to a grossly disproportionate level of wealth to accumulate in the hands of few who used their accruing power to block any policy changes that could lead to more progressive taxation or redistribution. Papandreou also made clear how, in the aggregate, more equal societies perform better in education, healthcare, life expectancy, environment, and are generally happier and among the most competitive economies.
Krugman was easily the strongest presenter and provided most of the consensus-based research and political economy rationales for taking specific actions moving forward. For example, at the time of this debate, Krugman claimed the Republicans were in the process of eliminating $2 billion dollars from the food stamps program (considered one of the most efficient bureaucracies) when the need for this cut could be eliminated by increasing the top marginal tax rate by one-seventh of 1%. Whether with respect to his reasoning, the data he provides to support his claims, or his clear understanding of the origin and implications of inequality trends, Krugman’s dominance throughout the debate was obvious but the points of agreement between all members are most worth considering.
Papandreou, Laffer and Krugman each understood the political and economic rationales for creating a balance of public policy interests between capital and labour, and on the need for total tax reform. The only disagreed on the processes used to achieve these goals. And if governments ever decide to proceed with either direction alone, that will be progress.
They all felt tax loopholes should be closed but Laffer felt flat taxation should also be adopted and lowered relative to the progressive tax brackets levied now. Krugman found the lower flat tax solution laughable and claimed the optimal top marginal tax rate is 73% as compared with a current average of 40% in Western states. It is thereby not surprising why France recently raised their rate to 73% which is still 14% less than the top rates that were implemented at the outset of the post-war era.
Papandreou proposed that closing loopholes successfully will require the development of an international regulation regime to ensure capital maintains their responsibilities to their domestic social contracts and to prevent them from following through on their threats of capital flight. Once this is achieved, the resulting surplus could be used to enhance each country’s soft and hard infrastructures such as education, research and transport systems (etc.) to enhance their competitiveness, to name just a few examples.
Gingrich was an abject disappointment; Krugman, a breath of fresh air.
5 out of 5 stars for this Munk Debate! Check it out!
January 4, 2019
I'm reading this just as it was announced that Google, the corporation that on one hand simplifies internet search for everyone but on the other hand makes money selling your data, was announced to have offloaded $23 billion to tax haven Bermuda for the year 2017. So this book of debates is really worth it to read, as we occupy a Gilded Age now more than ever. This book sought to resolve through the debate of two credentialed teams, whether we should tax the rich more. On one hand was Nobel Prize winner Krugman and the prime minister of Greece during its financial implosion, on the other hand the famous economist Arthur Laffer and the despicable Newt Gingrich. Hilariously enough, Laffer-- the only intellectually honourable member of the ''don't tax the rich more'' team-- pretty much deserts Gingrich to fend for his despicable self, and nearly sides with Krugman and Papandreou on the wealth equality spectrum. This is because Laffer only argues that we shouldn't tax the rich more because it will only cause them to make and burrow more loopholes to hide their riches in havens, like Google. But on the subject on collecting more money from the rich to redistribute through government, Laffer is in agreement. He just thinks higher taxes would lead to less collected taxes. In fact, he believes in tax reform and wants to tax the ultra-wealthy's change in annual wealth, not just their change in declared income-- ultimately reinstating the capital gains tax that Bush Jr. abolished in the US. This would amount to taxing the likes of Buffett billions, instead of mere millions. Why were he and Gingrich the Despicable even lumped together? Of course Gingrich lost the debate's final vote, but what does it matter, Trumpian economics showed the wealthy like him have won in this age, and sadly, he can cry his debate loss here all the way to the bank. "Taxation is the price of civilization", says Krugman, in echo of Oliver Wendell Holmes. Also per Krugman, taxation on the rich is not supposed to be punitive. It is not supposed to grind them to a halt. There continue to be a suite of rewards and perks for the special among us. It is not amiss to take from the very luxurious what goes towards forming a collective society.
April 29, 2014
An engaging debate regarding the state of income inequality, Krugman/Papandreou arguing for more taxation and Gingrich/Laffer arguing for less. I'm biased in favor of Krugman's arguments, but both sides came out swinging.
Displaying 1 - 3 of 3 reviews