By Larry Kotlikoff
Originally posted at The Hill, November 2017
The GOP tax bill is good, but not great. It will increase investment, output and real wages, but by far less than a smarter reform can generate. Second, the GOP plan is revenue-neutral at best. Yet, we desperately need more taxes to shore up Social Security and Medicare and to rebuild our failing infrastructure.
Third, the plan incentivizes investment, but does so inefficiently and unfairly. It provides past investments essentially the same tax breaks as new investment. But only new investment will grow the economy. Rewarding large C-corporations (actually, their shareholders) for investments they made years ago is simply a giveaway. MORE