2. During #wsjceocouncil interview with Gary Cohn, WSJ asks CEOs to raise hands if they'll boost investment if rates cut
3. Few CEOS raise hands
4. Cohn asks: "Why aren't the other hands up?"
Apparently Mr. Cohn is unfamiliar with the current tax code, which already protects investment from taxation. Consider, e.g., Amazon vs. Walmart:
This actually makes the case that we shouldn't give so much tax protection to reinvestment. I think most people would agree that encouraging businesses to reinvest is generally good, but Amazon definitely shows that there's a limit to that line of reasoning. A middle way has to exist, but cutting taxes on profits while doing nothing else sure isn't it. The more I read, the more I'm convinced that the US needs to move away from relying almost solely on the income tax and institute a VAT while cutting income taxes (and possible some very limited form of wealth tax) to create a more balanced approach to generating revenue. One of the upsides of the current tax bill is that it's so bad and will be such a catastrophe that it might spur us to reconsider how we raise revenue. Probably not.