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From: orb@whuxl.UUCP (SEVENER)
Newsgroups: net.politics
Subject: Re: Re: Re: The WSJ on Reaganomics
Message-ID: <369@whuxl.UUCP>
Date: Tue, 27-Nov-84 17:39:33 EST
Article-I.D.: whuxl.369
Posted: Tue Nov 27 17:39:33 1984
Date-Received: Wed, 28-Nov-84 04:34:25 EST
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Organization: Bell Labs
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> Greg Kuperberg writes: 
> The cost of government spending is two-fold:
> 
> 1)  Income tax is a tax on labor.  It is in fact an exhorbitant tax on
> labor.  This is one reason that labor is so expensive in the U.S.  Such a
> huge tax on labor is very bad for business.  Ask an auto company.
> 
> 2)  Most government money is given to government employees.  Thus the U.S.
> government is a very competetive employer, diverting much labor away from
> the economy, and making the remaining labor yet more expensive.

Rebuttal 1)other Western nations pay a greater percentage of their
           income in taxes.  How come they do well?
           Also: a just income tax taxes income from capital as much as
           income from labor.  While it is unfortunately true that our
           own tax system favors the wealthy, they do pay some income
           taxes on their capital gains and interest income.
 
Rebuttal 2)This great diversion of labor would be a surprise to the
           7.5% of the American population unemployed.  If government
           is employing everyone in sight, why do we have any unemployment?
           What would happen to unemployment if all government workers
           were laid off tomorrow? Do you suppose it would follow the
           dreamworld scenario of the free enterprise advocates who imagine
           that all miracles can be achieved by the "invisible hand"?
           Or would it follow the reality of our present economy in which
           the top 500 corporations control 2/3's of the economy and
           steadily control more year by year?
           Such a situation of oligpolistic control hardly seems to match
           the assumptions of free market efficiency. Why?
           How did this come about?  Was it only "government interference"
           or a natural cycle in which the free market leads to its own
           demise with economies of scale, bureacratization, and so forth?
tim sevener whuxl!orb