A paper by Kenneth Rogoff and Carmen Reinhart entitled Growth In A Time Of Debt became the intellectual backbone for the austerity movement/plutocrats and their apparatchiks in Washington and elsewhere. Now a graduate student has discovered a major excel error in Rogoff and Reinhart’s research which skewed the data to support their thesis and found that when that error was corrected their data actually supported the contrary view.

Joe Stiglitz had an Opionator piece in the NYT arguing that inequality was bad for growth. Krugman responded by taking issue with a couple of the points raised by Stiglitz: that upward redistribution of income leads to fiscal problems and that upward redistribution of income leads to stagnation.

The Benefit and the Burden begins with a short history of American taxation and a description of the core issues in the definition of income. It follows with some discussion of the principal economic arguments that have flowed around the relationship between taxes, growth and fairness, and then proceeds to examine the issues surrounding preferences in our tax code – for housing, for charitable contributions, for capital gains, and the problem of taxing corporate profits. It ends with a discussion of reform proposals, and Bruce makes his case for a VAT to close the revenue gap and fund the government that we will need, among other things, to support an increasingly elderly population.