He Reads Us!
Reported by Ellen - April 3, 2009 -
Guest blogged by Dan
FOX Business' Brian Sullivan responds to comments about his earlier post and (I flatter myself) our response entitled How to Lie with Statistics.
IIn his post titled, Not to "Tax" the Issue (Or Comments to My Blog Comments) Sullivan comments:
"My point was not to suggest that higher taxes equate to higher unemployment (though they may in specific consumer discretionary related segments of the economy such as boats and RVs that require much free cash flow to purchase), but rather to suggest that higher taxes will not necessary mean lower unemployment."
Indeed. The ONLY thing that will result in lower unemployment is higher employment, either by creating more jobs, eliminating fewer jobs, sending fewer jobs overseas, or producing more of what we consume here in the US. I'll grant Mr. Sullivan that the tax rate plays a role in these issues, though to what extent is certainly debatable.
Sullivan continues:
"The primary criticisms of my posting seem to revolve around the idea that I am suggesting unemployment will rise if taxes do, and to question my use of data points. Rather, I was trying to use data to suggest that history, both in the U.S. and Europe, suggest that higher taxes may not solve the jobs crisis many in our nation now face. I chose the data points (1970 - 1983) because it was one of the rare eras without major buildup (U.S. involvement peaked in 1968 though the war continued), which tends to skew data points."
It is sad that the only years between 1940 and 2000 without a major military buildup was 1970-1983. But given the level and consistency of military activity, the defense budget and activity certainly have an economic role. Leaving those years out just skew the figures.
Sullivan wrote: "Tomorrow (March 31) on the program we will compare historical employment rates with marginal tax levels and debate it with our Senior Economist Mark Lieberman. No doubt the debate will continue long after that as well."
The debate will continue, as well it should. Though one would have hoped for someone more "Fair and Balanced" than the Fox Senior Economist to debate the issue. Honest and respectful debate is the very essence of Democracy.
