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The Atlanta Fed’s GDPNow tracker downgraded its forecast for Q3 GDP growth again: it has now dropped from 6 percent at the end of July to 1.3 percent now. Then came the…
This letter appeared in the Duluth News Tribune on February 29th, 2020.
On Jan. 15, the News Tribune carried an op-ed of mine headlined, “Minnesotans are fleeing to avoid estate tax, so repeal it.” This drew a reply op-ed headlined, “Increase the estate tax,” which contained some curious errors.
It said: “To support his arguments, the column writer quoted two economic researchers stating that high taxes can provoke taxpayers to move to areas with lower taxes. However, the quoted study seemed to identify taxes in general and not just estate taxes.”
False. The paper I quoted, by economists Enrico Moretti and Daniel J. Wilson, is titled, “Taxing Billionaires: Estate Taxes and the Geographical Location of the Ultra-Wealthy,” and is freely available on the website of the National Bureau of Economic Research.
Indeed, my op-ed said, “In their paper, Moretti and Wilson studied ‘the effect of state-level estate taxes on the geographical location of the Forbes 400 richest Americans.
Furthermore, it says: “Collecting more taxes could benefit Minnesota’s budget.”
No doubt. But Moretti and Wilson’s paper, echoing our earlier paper, states that, by driving wealthy Minnesotans and their future payments of income, sales taxes, etc., out of the state, the estate tax actually loses money for Minnesota’s state government. The evidence suggests that politicians in St. Paul would have more revenue to spend if they got rid of the estate tax.