Subtitle: how the political discourse confuses me.
I read a bunch of center-left political bloggers (e.g., Josh Marshall, Kevin Drum when he doesn’t make me tear my hair out, etc.), and many of them seem to be taking seriously the idea that there’s an important policy difference between raising money by raising marginal tax rates and raising money by decreasing deductions. (E.g., Marshall, Drum.) Now, it’s certainly true that these two things are not exactly the same, and there are some different distributional and incentive-related differences between them (e.g., a raise in the top marginal rate will be much better from the point of view of non-profits than a hard cap on deductions). But if the question you’re interested in is how much money the federal government can raise, or alternatively what the typical tax burden will be like, then it doesn’t matter at all if we get to the same place by changes to deductions or changes to marginal rates. Is the theory that this matters because Republican members of the House are incredibly stupid? Or what? It just seems like a pretend issue to me.
Edit: ok, Krugman wonders why Republicans care (which maybe is the reason Marshall and Drum are paying attention) and offers possible explanations.