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Wednesday, October 13, 2010

The W Tax Cuts, ctd...

Oct 13th, 2010
We would like to welcome a new contributor, James Hayford, to The Hand.
by James Hayford

N. Gregory Mankiw
N. Gregory Mankiw writes in the New York Times that though he can afford to pay more taxes we should consider how they may affect his incentives to work. His basic argument is that he has enough money for himself, but he would like to leave some money to his children. He takes us though some math to reach the conclusion that the combined effects of higher income taxes, and the estate tax end up making the $1000 he would earn for writing an article so small it's no longer worth it. 

Leaving aside the fact that the estate tax only kicks in on amounts over one million dollars, so he already has a considerable nest egg set aside for his kids, he thinks the real suffering will come from the hole left in our culture by him and all the people like him who don't produce articles, movies, or books, perform concerts, or even put braces on our kids teeth. 

My take? Perhaps it would be a good thing if Dr Mankiw, and others like him, refused the work and gave an opportunity to the other 98% of us who are more intellectually, creatively, and literally hungry. 

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