Saturday, May 19, 2018

Saturday Afternoon Links

Assorted content for your weekend reading.

- Noah Smith writes that public resentment toward the U.S.' wealthiest few is based on a genuine (and justified) concern about an economic system rigged to exacerbate inequality across generations, not mere envy toward the people who have more:
(R)esentment of the super-rich is probably not simply envy. It likely has to do with notions of fairness. As economist N. Gregory Mankiw conjectured in a 2013 essay, people are more likely to begrudge vast fortunes if they feel the wealth wasn’t earned. Technology company founders may be rich, but they mostly got that way by creating new products or services that benefit many people’s lives — think PayPal or iPhones or Facebook. Similarly, rich athletes or entertainers used their talents to make life more enjoyable for millions of Americans.

But about 38 percent of American billionaires inherited at least a substantial part of their fortunes. These heirs and heiresses tend to be less in the public eye, but they hold vast sums nonetheless. Taxing these unearned billions seems like a great way to allay public concerns about the super-rich.

Economics provides both empirical and theoretical support for the idea of taxing inheritances at much higher rates, and making the tax much harder to avoid. Surveys find that informing people about wealth inequality makes them much more likely to support higher estate taxes, but only slightly more likely to support other forms of taxation. And economic theory suggests that taxing wealthy inheritors can increase economic efficiency if many of them are bad investors.

So one idea to address popular anger over the dramatic success of a few super-rich individuals is to stop them from passing most of those fortunes on to their children. That won’t take the Elon Musks and the Mark Zuckerbergs out of the news, but it will reassure Americans that most of their crazy-rich countrymen made their own money through hard work and talent, not just the luck of having rich parents.
- George Eaton discusses the combination of popular support which is leading toward increasing public ownership of the UK's public services. And David Zarnett reports on the Wynne government's giveaway of a profitable casino for pennies on the dollar - representing just one more example of how the public loses out when neoliberal government focus on privatization over competent management.

- Adam Litwin, Ariel Avgar and Edmund Becker study (PDF) how the outsourcing of cleaning services in hospitals leads to the increased spread of infectious diseases.

- Bernard Goldstein comments on another of the Trump administration's moves to prevent regulators from doing their jobs, this time by making a policy of rejecting some of the best available environmental studies.

- Finally, following up on this week's column, Samir Shaheen-Hussain points out another policy choice which results in children being deprived of family support when it's needed most, as air ambulances refuse to allow parents to accompany Inuit children to receive care.

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