Saturday, September 22, 2007

Blurbs on Obama's Tax Policy

We'll have something to say about Obama's tax proposal later. For now, I just want to highlight comments on the proposal from several prominent tax experts. The most notable point in the comments is the support from Alan Auerbach, who is one of the country's top tax policy economists, second only to Joel Slemrod of the University of Michigan.

"This plan directs its attention to the vast majority of taxpayers, who have seen little benefit from the current administration's tax policy. Through its income tax credit for payroll taxes and its simplification measures, it should make work more rewarding and paying taxes less difficult."
[Alan Auerbach, Director, Burch Center for Tax Policy and Public Finances; Robert D. Burch Professor of Economics and Law, University of California-Berkeley; Member, Panel of Economic Advisors, U.S. Congressional Budget Office (1998-2002)]

"Barack Obama's plan would restore some much needed fairness in our tax system for the middle class by making work pay, simplifying our tax code, making housing more affordable, and ensuring that millions of seniors never have to pay income taxes. Taken together, millions and millions of families will fill out fewer forms and have more in their pockets."
[Michael Blumenthal, Former Secretary of the Treasury (1977-1979)]

"For the last several years, tax policy makers have seemed oblivious to growing income inequality and the economic challenges that face working middle-income Americans trying to educate their children, buy their first homes and save for their retirement. In contrast, Senator Obama's Tax Fairness Plan recognizes that a progressive tax system is not characterized just by progressive tax rates, but also by certain tax credits designed, for example, to reward work or to provide a tax benefit to all homeowners -- not just to those taxpayers who itemize. He provides real simplification by taking some senior citizens off the rolls entirely and by providing millions of Americans pre-prepared returns, much like the Ready Return program used in California. Senator Obama also recognizes that a system riddled with tax subsidies is not perceived as fair because people rightly worry that the rich or more sophisticated are taking advantage of benefits they cannot enjoy. Accordingly, he advocates eliminating many of these special tax breaks, thereby also eliminating the economic distortions that they create."
[Elizabeth Garrett, Sydney M. Irmas Professor of Public Interest Law, Legal Ethics, Political Science and Policy, Planning and Development, University of Southern California; Former Member of President Bush's Advisory Panel on Federal Tax Reform (2005)]

"Senator Obama's tax fairness plan benefits workers, seniors and middle class homeowners and would eliminate loopholes and schemes by which the super rich and many companies avoid taxes. He would help restore an economically sound progressive tax system, reversing the regressive nature of six years of tax changes. Senator Obama recognizes that globalization presents many benefits and new opportunities -- including unfortunately, opportunities to evade legally due taxes. Most of us whose taxes are paid through withholding can't take advantage of tax havens and other off shore tax avoidance gimmicks. Those individuals and companies that do cause the rest of us to pay higher taxes while evading hundreds of billions of their tax obligations. One of the first steps taken by the Bush Treasury, even before cutting rich folks taxes, was to eliminate U.S. support for an international challenge to tax havens."
[Joseph H. Guttentag, Former Deputy Assistant Secretary for International Tax Affairs, Department of Treasury, Clinton Administration]

"Senator Obama's tax fairness plan demonstrates his commitment to shared prosperity."
[ Jeffrey Liebman, Professor of Public Policy, Harvard University; Former Special Assistant to the President for Economic Policy, White House National Economic Council (1998-1999)]

"Senator Obama's plan will bring about a long overdue reversal of the direction of our nation's tax policies. Instead of concentrating the benefits of tax reductions among the very affluent, his plan will reduce growing income disparities and help millions of hard-working taxpayers with middle-class tax relief. And instead of undermining international efforts to combat tax evasion through offshore tax havens, the Obama plan will lead the way in pressuring tax haven countries to share the information needed to make tax evaders pay their American taxes."
[Dan Tarullo, Professor of Law, Georgetown University; Former Assistant Secretary of State for Economic and Business Affairs (1993-1996); Former Assistant to the President for International Economic Policy (1997-1998)]

Obama's Econ Peeps

An April WSJ article looked at three of the key economic advisors to Obama: Jeff Liebman, David Cutler, and Austan Goolsbee. All three are mainstream academics who fit comfortably in the conventional Democratic wonk world. Liebman and Cutler are both Harvard profs who served in the Clinton administration--Liebman's an expert on the EITC and welfare policy, while Cutler's a well-known health economist. Goolsbee is a smart up-and-coming University of Chicago prof and tax policy expert, who's been tight with Obama since they met when Obama was teaching the law school there.

This Chicago Tribune article also lists as part of the Obama economic team Michael Froman, a Citigroup executive and former chief of staff to then-Treasury Secretary Robert Rubin. My guess, however, that Froman's role is more of Wall Street "outreach" than policy advisor.

The other key player in Obamanomics is Karen Kornbluh, Obama's policy director and another former aide to Bob Rubin during the Clinton years. Like the others, Kornbluh is an unthreatening wonk, but I'd place her slightly to the left of Obama's econ trio. (Although her Wikipedia entry lists her as an "economist," the established entry card to the economist priesthood is a Ph.D., which she does not have.) Before working for Obama, Kornbluh spent time at the New American Foundation, which is known for being one of the less conventional of the the DC think tanks, and she has long pushed a "family-friendly progressive agenda." See for example this Atlantic article.

Friday, September 21, 2007


These are grim times for America.

As one of the greatest living economists, George Akerlof, said four long years ago we are are faced with "the worst government the US has ever had it in its more than 200 years of history. It has engaged in extraordinarily irresponsible policies not only in foreign policy and economics but also in social and environmental policy. This is not normal government. Now is the time for people to engage in civil disobedience. I think it's time to protest - as much as possible."

The country will need an extraordinary president to pull us out of the abyss and restore the promise of America. We believe that Barack Obama is the best choice for that role. He opposed the disastrous invasion and occupation of Iraq from the start, and we believe he would be most committed to ending that debacle and bringing the troops home. He brings a sense of vision and hope to his candidacy that is absent from candidates who have been contaminated by too many years in Washington, steeped in the foul waters of DC conventional wisdom.

More on all that later. This blog will be primarily a space for discussion of Obama's economic policy pronouncements. Contributors will be a mix of economists from academia and government, some of whom have dabbled in politics in the past. (Some will post pseudonymously to avoid violating their current employers' policies on political involvement.) The discussion here will not be blind hero worship by any means; where we think Obama has it wrong, we'll let you know.

OK, fired up! Ready to go!