Good afternoon, Michael.
I have been listening to the Milton Friedman presentation on your podcast 496, and I must thank you for bringing this ‘back from the dead.’
Of course, I have read of Prof. Friedman in the past, but I had never heard his voice. His presentation was clear, concise, friendly, and accessible to almost anyone I can imagine. It is refreshing to hear that such a celebrated individual is so accessible.
I have done some of these same thought experiments with colleagues… No tax on corporations, and the possibility of income tax not being progressive—but making the tax, once a certain income is made, such as a million dollars, to suddenly become ZERO.
Imagine the incentives for people to produce and create wealth.
No tax on corporations: Not the 35% current tax, and not 20% tax currently proposed in US Congress, but Zero. Dr Friedman gives a great argument that I need not repeat here. But it is transparent, and makes much sense. (I guess the politicians don’t want to make it so transparent).
Imagine the incentive if those people who are good at creating wealth, have even more incentives to grow more and grow faster if they are not taxed at higher levels of production. By definition, they will have to create more or what others want to have: be it goods, services, entertainment, whatever…
And, usually to increase this wealth, very likely the resources of hiring more people (creating jobs), or increasing efficiencies by buying machines/robots/etc to create more goods more efficiently (also creating more jobs to those who make those machine tools or capital goods)
Thanks again for the stimulating podcast. Much fun, and I can share these ideas with my colleagues, who really still don’t get it.
Thanks for the nice words.