Fix the Deficit? Tax Corporations

Here’s the link to my op-ed in today’s New York Times, in case you missed it at Facebook.  Already the older arguments about corporations’ ability to pass taxes along to consumers as higher prices has resurfaced, as a critique of what I’m claiming here.  Of course I’m mystified by these older arguments in view of globalization and the theoretical controversies of the last, say, ten years, but the lack of political imagination which animates their return from the domain of the repressed might indicate that what I cite here as a reason to reconsider is a rationale for retreat.



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One response to “Fix the Deficit? Tax Corporations

  1. JRW

    I wouldn’t like to consider myself lacking in political imagination but I would like to understand why the prospect of tax costs being passed through is null and void? What am I missing in thinking that marking up over tax obligations is a reasonable expectation of corporate pricing behavior? I’m vaguely familiar with the argument that in a high corporate tax environment, profiting from cutting wages is a more difficult proposition, the idea being that taxing away gains from reduced payments to labor will tie profitability and productivity more closely together. That’s an argument I mostly buy without having scrutinized the historical record too closely. But I hadn’t considered how it relates to the notion that business is apt to pass along all costs including taxes. What short of price controls can force business to eat the tax cost? Global competition? Point me to the new arguments.

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