Edward Conard

Top Ten New York Times Bestselling Author

  • “…a fresh argument for the productive value of inequality.” - David Autor, Professor of Economics, Massachusetts Institute of Technology
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “There are an amazing number of good ideas and interesting points made in Unintended Consequences. The thinking underlying it, and the obvious depth of understanding of the author, are very impressive.” - Steven Levitt, coauthor of Freakonomics; 2004 John Bates Clark Medal
  • “…reminds us that inequality sends a signal of what society lacks most, in America’s case, entrepreneurship and risk taking.” - Lawrence Lindsey, CEO, The Lindsey Group, former Director of the National Economic Council
  • “Unintended Consequences is full of substance, it is one of the must-read books of the year, and once I finish it I will be giving it a second read through right away.” - Tyler Cowen, Professor, George Mason University
  • “Unintended Consequences represents the most cogent and persuasive analysis of the Financial Crisis to date.” - Andrei Shleifer, 1999 John Bates Clark Medal Winner
  • “…a comprehensive explanation of the modern economy.” - Julian Robertson, Founder, Tiger Management
  • “Unintended Consequences provides a provocative interpretation of the causes of the global financial crisis and the policies needed to return to rapid growth. Whether you agree or not, this analysis is well worth reading.” - Nouriel Roubini, New York University; Chairman, Roubini Global Economics
  • “…a very valuable contribution.” - Larry Summers, former Secretary of the Treasury and director of the National Economic Council, president emeritus, Harvard University
  • “…challenges misconceptions that distort our economic debates.” - Arthur Brooks, President of the American Enterprise Institute
  • “Unintended Consequences should be read by anyone who takes for granted the superiority of progressive taxation and has not thought carefully about the trade-offs involved.” - The New Republic
Upside of Inequality Oxford Unintended Consequences

AI Summary. The Congressional Budget Office calculates that the top-earning 20% of U.S. households received 58% of income and paid 69% of federal taxes, while the top 1% earned 18% and paid 25%. U.S. top income, capital-gains, corporate, and estate tax rates exceed typical OECD levels; the revenue gap reflects value-added taxes.

Brian Riedl Wall Street Journal
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As deficits surge towards 10% of GDP, @Brian_Riedl argues there is limited space to increase revenue by taxing the rich, which at most could raise an additional 2% of GDP over the long term.

As deficits surge towards 10% of GDP, @Brian_Riedl argues there is limited space to increase revenue by taxing the rich,...

Can higher taxes on top earners close the federal revenue gap?

Core argument: The CBO calculates that the top-earning quintile earned 58% of U.S. income but paid 69% of all federal taxes in 2019, while the top 1% made 18% of income and paid 25% of federal taxes.

The CBO calculates that the top-earning quintile, which accounts for 58% of all income in the U.S., paid 69% of all federal taxes in 2019. The top-earning 1%, which makes 18% of all income, paid 25% of all federal taxes. The bottom-earning 60% earned 23% of income but paid 13% of federal taxes. America’s top tax rates often exceed international norms. Our top income-tax bracket of 43.7%—including typical state taxes—exceeds that of the standard OECD nation (40.4%). Our top capital-gains tax rate is 10 points above the OECD average, and our corporate tax rate exceeds not only the OECD mean but that of every Scandinavian nation. America’s effective corporate tax rate is also above average, as are its estate and inheritance taxes. How, then, does the typical OECD nation collect 7.5% of its GDP more than Washington? OECD nations collect an average of 7.2% of GDP in VAT revenues with rates as high as 27%. In other words, the revenue gap isn’t driven by tax-the-rich policies.

Takeaways by Macro Roundup® AI

  1. The CBO calculates that the top-earning quintile earned 58% of U.S. income but paid 69% of all federal taxes in 2019, while the top 1% made 18% of income and paid 25% of federal taxes.
  2. The bottom-earning 60% of Americans earned 23% of income and paid 13% of federal taxes, according to the CBO.
  3. The typical OECD nation collects 7.5% of GDP more in revenue than Washington and averages 7.2% of GDP from value-added taxes with rates as high as 27%, even as U.S. top income, capital-gains, corporate and estate tax rates exceed OECD norms.

Related Articles:

  • The Limits of Taxing the Rich — Stabilizing US federal debt at 100% of GDP would require non-interest savings starting at 2% of GDP and rising to 5% of GDP over three decades, assuming no new spending, tax cuts, or crises. Taxing the rich cannot close more than a small fraction of this gap.
  • From Riches to Rags: Causes of Fiscal Deterioration Since 2001 — Federal debt held by the public rose from 32% to 98% of GDP over roughly two decades, despite earlier Congressional Budget Office projections that the debt would be paid off. The authors attribute 37 percentage points to major tax cuts, 33 to discretionary spending and Medicare expansions, and 28 to recession and pandemic responses.
  • Taxing Billionaires: Estate Taxes and the Geographical Location of the Ultra-Wealthy — The authors estimate that US billionaires move to states without estate taxes as they age, with $80.7bn of Forbes 400 wealth escaping estate taxation as a result. They find that for the average state the added estate tax revenue exceeds forgone income tax revenue by 31%, with California a notable exception.
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