This is llm hallucination too? Old ideas and goes back to a system that was in place in the 1800’s. It didn’t go well. Who are these people that peddle this every 20-30 years or so? Opportunist.
A number of countries that implemented flat tax and simplified the tax code and reduced loopholes actually increased tax revenues (Estonia, Russia, Bulgaria come to mind). Those are not their only sources of tax revenue, of course - but interesting experiment (make it simpler and less loopholes and no insane concept of "tax returns").
GDP per capita has been declining in the UK and this is indeed a big issue (people are getting poorer) hidden behind the marginal growth of the overall GDP created by high immigration. This is linked to a long-standing productivity problem.
Some of the ideas bring us back to the Brexit debate. Being outside the EU allows a freedom of action but, depending how far deregulation and law taxes are taken, that also means retaliatory barriers from the EU, which is still the largest trading partner (41% of exports, twice the volume to the 2nd export market, which is the US).
The problem with the UK tax system is not that it is progressive. In fact, once you add NI it is not all that strongly progressive.
The problem is that complexity of tax law, the number of loopholes, incentives, refunds....
The really big problem is that people on low incomes do not have an incentive to work because the loss of benefits means they are barely any better off from working. That is a strong argument for UBI, or at least a much slower rate of loss of benefits so people keep more of their income.
There are a lot of imprecise and misleading claims made here, for example:
> people who are talented, people who are wealthy, people who have capital, people who have entrepreneurial skills, they can move.
Talent, wealth, and entrepreneurial skills are not the same thing. Wealth is often inherited, talented people may be employed and not all talents are all that portable. While capital can be moved the assets that it is tied up in cannot - you can see your business and move, but that just means someone else buys your business. A wealthy person does not have to live where their investments are.
> Please write a transcript of an interview with an imaginary economist who considers that neoliberalism doesn't work because we haven't been far enough and blame any sort of regulations. Don't mention any material constraints like the availability of cheap energy sources. Don't mention libertarianism. Please also provide a prompt for the TTS model (the discussion needs to sound serious and academic).
> It’s core argument is simple: in a world where talent and capital move easily […]
I'm not sure about the talent part: unless you're strictly talking about remote work, going to a new country is not what I would think of as "easy".
> Doug explained why a staged path to a 20% flat tax […]
It seems to me that flat taxes ignore the marginal utility of every new dollar of income.
What exactly is having the top income earners keep more money gotten society? It seems like not much besides more inequality (which has probably helped fuel political dissatisfaction):
> This paper uses data from 18 OECD countries over the last five decades to estimate the causal effect of major tax cuts for the rich on income inequality, economic growth, and unemployment. First, we use a new encompassing measure of taxes on the rich to identify instances of major reduction in tax progressivity. Then, we look at the causal effect of these episodes on economic outcomes by applying a nonparametric generalization of the difference-in-differences indicator that implements Mahalanobis matching in panel data analysis. We find that major reforms reducing taxes on the rich lead to higher income inequality as measured by the top 1% share of pre-tax national income. The effect remains stable in the medium term. In contrast, such reforms do not have any significant effect on economic growth and unemployment.
> In 2015, Douglas McWilliams of the Centre for Economics and Business Research, which is based on Old Street, authored The Flat White Economy: How the Digital Economy Is Transforming London & Other Cities of the Future.
> Now, let me just quote some statistics. We have the most successful tech sector in Europe. The reason why is we are outside the Digital Markets Act, the Digital Services Act, and the AI Act, which are three European acts which heavily constrain tech growth in the EU. As a result, the thing that I call the flat-white economy ...
Digital Markets Act (2022), Digital Services Act (2022) and AI Act (2024) - these regulations are obviously totally different to the UK versions - Digital Markets, Competition and Consumers Act (2024), Online Safety Act (2023).
The reason why something was worthy of a book in 2015 is something that happend in 2022 / 2024, the car in the car section must be a delorean. There are a lot of good reasons, making stuff up makes me wonder about the validity of the remainder of the arguments.
> Finally to perhaps lighten the mood, rather than the usual book recommendations, the three of them discuss their favourite cars.
I'm sure they're talking about the 8 million dollar Porto Embargo or whatever, but I would love one day to hear a podcast discussing the genius of the Toyota Corolla. Safe, affordable, available, reliable. I've had friends with Toyotas that were about to fall off their base from road salt rust but the engine and transmission still worked perfectly.
Pretty amazing that you can be of modest or lavish means and still own a really solid car that everyone can fix. A lot funner than hanging out in the repair shop waiting for a specialist to fix a blown turbo headgasket.
Or maybe no one with interesting thoughts on anything would invest anything in a nation where if post anything online that might be slightly controversial you might go to jail and not even have the protection of a jury to balance out the overreach of government.
That and other things that are transforming it into a nanny state make it a hell no.
But yeah, it's nice you are lowering taxes and regulations on those who fall in line.
I'm starting to believe "economic growth" is fiction. Just because an item has a higher price does not mean it's higher output. If we measure the value of things based on say the energy + labor cost to produce it, economic output (or GDP) will look very different. I'm not saying that's a good measure, but that there are other ways to look at it and the current one seems broken.
When Elon Musk says the only way to solve the US debt crisis is through automation and AI to boost GDP, it makes no sense. Government revenue has less and less to do with output and more to do with taxes on labor, so automation will make the problem worse. I'm not saying we shouldn't automate things, but that the ideas of cause->effect when it come to money are not very well thought out - yes, including my own.
16 comments
[ 24.9 ms ] story [ 1439 ms ] threadSome of the ideas bring us back to the Brexit debate. Being outside the EU allows a freedom of action but, depending how far deregulation and law taxes are taken, that also means retaliatory barriers from the EU, which is still the largest trading partner (41% of exports, twice the volume to the 2nd export market, which is the US).
The problem is that complexity of tax law, the number of loopholes, incentives, refunds....
The really big problem is that people on low incomes do not have an incentive to work because the loss of benefits means they are barely any better off from working. That is a strong argument for UBI, or at least a much slower rate of loss of benefits so people keep more of their income.
There are a lot of imprecise and misleading claims made here, for example:
> people who are talented, people who are wealthy, people who have capital, people who have entrepreneurial skills, they can move.
Talent, wealth, and entrepreneurial skills are not the same thing. Wealth is often inherited, talented people may be employed and not all talents are all that portable. While capital can be moved the assets that it is tied up in cannot - you can see your business and move, but that just means someone else buys your business. A wealthy person does not have to live where their investments are.
I'm not sure about the talent part: unless you're strictly talking about remote work, going to a new country is not what I would think of as "easy".
> Doug explained why a staged path to a 20% flat tax […]
It seems to me that flat taxes ignore the marginal utility of every new dollar of income.
What exactly is having the top income earners keep more money gotten society? It seems like not much besides more inequality (which has probably helped fuel political dissatisfaction):
> This paper uses data from 18 OECD countries over the last five decades to estimate the causal effect of major tax cuts for the rich on income inequality, economic growth, and unemployment. First, we use a new encompassing measure of taxes on the rich to identify instances of major reduction in tax progressivity. Then, we look at the causal effect of these episodes on economic outcomes by applying a nonparametric generalization of the difference-in-differences indicator that implements Mahalanobis matching in panel data analysis. We find that major reforms reducing taxes on the rich lead to higher income inequality as measured by the top 1% share of pre-tax national income. The effect remains stable in the medium term. In contrast, such reforms do not have any significant effect on economic growth and unemployment.
* https://eprints.lse.ac.uk/107919/
* https://en.wikipedia.org/wiki/Trickle-down_economics
> Now, let me just quote some statistics. We have the most successful tech sector in Europe. The reason why is we are outside the Digital Markets Act, the Digital Services Act, and the AI Act, which are three European acts which heavily constrain tech growth in the EU. As a result, the thing that I call the flat-white economy ...
Digital Markets Act (2022), Digital Services Act (2022) and AI Act (2024) - these regulations are obviously totally different to the UK versions - Digital Markets, Competition and Consumers Act (2024), Online Safety Act (2023).
The reason why something was worthy of a book in 2015 is something that happend in 2022 / 2024, the car in the car section must be a delorean. There are a lot of good reasons, making stuff up makes me wonder about the validity of the remainder of the arguments.
I'm sure they're talking about the 8 million dollar Porto Embargo or whatever, but I would love one day to hear a podcast discussing the genius of the Toyota Corolla. Safe, affordable, available, reliable. I've had friends with Toyotas that were about to fall off their base from road salt rust but the engine and transmission still worked perfectly.
Pretty amazing that you can be of modest or lavish means and still own a really solid car that everyone can fix. A lot funner than hanging out in the repair shop waiting for a specialist to fix a blown turbo headgasket.
That and other things that are transforming it into a nanny state make it a hell no.
But yeah, it's nice you are lowering taxes and regulations on those who fall in line.
When Elon Musk says the only way to solve the US debt crisis is through automation and AI to boost GDP, it makes no sense. Government revenue has less and less to do with output and more to do with taxes on labor, so automation will make the problem worse. I'm not saying we shouldn't automate things, but that the ideas of cause->effect when it come to money are not very well thought out - yes, including my own.