(01-07-2014 09:29 AM)Niner National Wrote: (01-07-2014 08:28 AM)DrTorch Wrote: More drivel. The post by Warren Meyer shows that over regulation and bureaucratic entanglement is often worse than taxes.
Agree. Regulations and red tape are often cited by business owners as being a larger factor in investment/expansion/business location than taxes.
The problem is that the two together are a huge barrier. The big problem with regulations are not so much that they are overly burdensome in a substantive way, but that they are a huge procedural burden. A huge hunk of our regulations are designed not to improve the quality of air or water, or to make workplaces safer, but rather to protect and grow the jobs of bureaucrats to perform meaningless inspections and process useless paperwork.
Norway has much more stringent regulations for offshore drilling than we do. As a result, they've been drilling in deep water since the 1970s and have never had a Macondo-style incident. And if they did, they'd be much better equipped to deal with it than we were, because they have funded proper clean-up measures as they have gone along. The regulations add maybe $10 million to the cost of a well. But you can get a well approved in a fraction of the time it takes here. And businesses love certainty, so they'd rather pay the extra to get an answer. That's the kind of thing we can--and should--be doing.
Remember also that the members of OECD (basically the developed countries) collect on average 30% of their tax revenues from consumption and excise taxes. And their income tax rate structures are much flatter (less "progressive"). That allows them to have far greater government revenues as a percent of GDP than we do, with lower tax rates for corporations (in all cases) and generally without substantially higher tax rates for high-income individuals (often lower, particularly for investment income).
People like to criticize consumption taxes as regressive. But think about it, they are no more regressive than the corporate income tax. Corporations don't pay taxes, they load them onto the price of their products and collect them and pass them through to the government. That means the same people who pay consumption taxes pay corporate taxes. If one is regressive, then so is the other, and pretty much to the same extent.
