Krugman's Dichotomy

http://www.futureofcapitalism.com/2011/01/krugman-dichotomy

From Paul Krugman's latest New York Times column:

One side of American politics considers the modern welfare state — a private-enterprise economy, but one in which society's winners are taxed to pay for a social safety net — morally superior to the capitalism red in tooth and claw we had before the New Deal. It's only right, this side believes, for the affluent to help the less fortunate.

The other side believes that people have a right to keep what they earn, and that taxing them to support others, no matter how needy, amounts to theft. That's what lies behind the modern right's fondness for violent rhetoric: many activists on the right really do see taxes and regulation as tyrannical impositions on their liberty.

There's no middle ground between these views.

I think he's wrong that there's no middle ground here. Plenty of people on what Mr. Krugman calls "the other side" agree that it's right for the affluent to help the less fortunate — they just think it's more effective to do so through private charities than through government. Or they agree that there should be some government social safety net, but think that safety net has gotten so big and expensive that it's created perverse incentives and waste, so they want its size reduced and its operations improved. There are very few on "the other side" who believe, as the straw man Professor Krugman constructs would have it, that all taxes, even taxes for the purpose of redistribution, are theft. The last time the Republicans controlled the White House and the House of Representatives, under George W. Bush, they passed a Medicare prescription drug benefit and a No Child Left Behind expansion of federal aid to poor public schools that were both all about using taxes to support others. And they passed the Sarbanes-Oxley act expanding financial regulation.

by Ira Stoll  |  Jan 14, 2011 at 8:53 am Related Topics:  Capital Markets Regulation, Education, Paul Krugman, Politics, Taxes receive the latest by email: subscribe to the free futureofcapitalism.com mailing list