Shaviro: The Rise (And Fall?) Of Neoliberalism In Tax
Daniel Shaviro (NYU; Google Scholar), The Rise (and Fall?) Of Neoliberalism in Tax (JOTWELL) (reviewing J. Bradford DeLong (UC-Berkeley;Google Scholar), Slouching Towards Utopia: An Economic History of the Twentieth Century (2022).
Bradford DeLong’s career opus, Slouching Towards Utopia, is a very long — although, in my view, consistently illuminating and entertaining — work of economic history that only very briefly, for a few pages here and there, touches on the history of taxation. Why, then, do I regard it as offering a highly suitable subject for a Jotwell Tax column?
The broader answer to this question is that historical context is vital to understanding tax (like other) institutions and ideas and yet often is ignored, other than by tax historians. The narrower answer, illustrating this broad proposition, pertains to the particular context of the great intellectual shifts that have occurred over the last thirty-plus years, not just in legal academic thinking, including in tax, but in American intellectual and political life more generally.
Slouching Towards Utopia concerns what DeLong calls the “long twentieth century,” which he views as having run from roughly 1870 to 2010. He argues that these 140 years were “the most consequential of all humanity’s centuries” (P. 1), above all because — despite disasters along the way, such as two world wars and the Great Depression — they featured startlingly high rates of annual per capita economic growth. During this period, he estimates that annual growth averaged 2.1 percent per year, as opposed to 0.45 percent over previous centuries (P. 3), and perhaps 0.6 percent in the years since 2010 (P. 516). This rapid growth rate triggered a more than an eightfold increase in world income per capita from the beginning to the end of the “long century” — despite an immense concomitant rate of population increase — transforming everyday life around the world for the (at least materially) better, by reducing dire poverty and allowing luxury goods to be widely available, rather than being limited to people at the top of the income distribution.
Slouching Towards Utopia is far too broad and rich in its coverage of the last two centuries of (mainly American and European) economic, political, and even military history for it to be reduced to merely a discussion of neoliberalism’s rise and disappointing fruits. The main reason for reading it is to enjoy and reflect on DeLong’s broader, and highly varied, historical and intellectual themes, spanning much of the last two centuries. But it’s reaching that topic, among many others, gives particular food for thought to tax scholars who are interested in the last few decades’ course of the field.
Doran: The Great American Retirement Fraud
Michael Doran (Virginia; Google Scholar), The Great American Retirement Fraud, 30 Elder L.J. 265 (2023):
Over the past twenty-five years, Congress has enacted several major reforms for employer-sponsored retirement plans and individual retirement accounts (“IRAs”), always with large bipartisan, bicameral majorities. In each case, legislators have claimed that the reforms would improve retirement security for millions of Americans, especially rank-and-file workers. But the supposed interest in helping lower-income and middle-income earners has been a stalking horse for the real objective of expanding the tax subsidies available to higher-income earners.
The legislation has repeatedly raised the statutory limits on contributions and benefits, delayed the start of required distributions, and weakened statutory non-discrimination rules – all to the benefit of affluent workers and the financial-services companies and retirement-plan service providers that collect fees from retirement plans and retirement savings. The result has been spectacular growth in the retirement accounts of higher-income earners but modest or even negative growth in the accounts of middle-income and lower-income earners.
