A little story about tax competition

Why would anyone shop along the Vermont side of the border? N.H. Union Leader "Thanks, Vermont! Saving NH liquor stores."

Tax history as natural history

The morally discredited U.S. tax system has evolved taking with it a bit of the American character to question authority. Bit by bit, the tax system has made us a bit fatalistic, as the power of central government grows. Neo-socialists take note of Kevin Hassett's offering:

Today taxes eat up about 30 percent of income, a much heavier burden. And like our ancestors, we don't believe that our money is particularly well spent. A Washington Post-ABC News poll taken last April found that Americans believe that 51 cents of every tax dollar is wasted. But where's the outrage? Most of us don't even own muskets, and the few of us who have revolted against the IRS are settled safely behind bars, to popular acclaim.

Which makes the U.S. tax system, ugly as it is, something of a marvel. It raises revenue without raising a ruckus. A simpler and more efficient system would undeniably serve everyone better, but the current hodgepodge is so entrenched as to have become a political third rail, and attempts to reform it almost always fail or are gradually reversed. Witness Ronald Reagan's Tax Reform Act of 1986.

Like a finch in the Galapagos Islands, the tax code has gradually evolved in a manner that maximizes its chances for survival. So a natural history of our tax system provides an interesting mirror on ourselves and reveals some surprising facts.

Carla Howell's annual rite to sing her song

It's tax time which means it's time for libertarian activist Carla Howell's little ditty on the joys of filing taxes. I'm not sure Carla's into paying taxes on principle but the song reminds us all of the need to simplify the tax system either with a national sales tax or a flat rate income tax.

Today, Americans spend more than 6 billion hours at a cost of $265 billion preparing their taxes in what amounts to tortuous deadweight loss to the economy.