TASC’s Annual Conference (‘The Challenge of Economic Inequality to Recovery and Wellbeing’) is taking place on Friday 20th June in the Hogan Suite, Croke Park Conference Centre. Places remain for the afternoon keynote address by Professor Thomas Piketty, with a response by Professor Patrick Honohan and discussion session.
The afternoon session will begin at 2pm sharp, with people asked to take their seats at 1.45pm, as Prof. Piketty is flying in and out on the same day. Booking details are available here.
The full conference programme is here.
(Although the morning session is fully booked, TASC will also be video-recording all sessions and making these recordings available via our website afterwards. If someone is strongly interested in attending the morning session, they should contact Nat O’Connor on noconnor@tasc.ie)
20 replies on “TASC Conference on 20th June”
Up to P.400 of ‘Capital in the 21st century’. I hope to be able to attend. If I do, what question might I lob him? I’ll report back here if I am able to make it.
Hi Gavin
I’m going to go so ping me if you can make it and we’ll plot.
s
Great stuff Sarah. Perhaps we should quote Furman at him? They both have that ‘young and good looking and acting kind of tough’ thing going on. I’ll know if I can make it by tomorrow and I’ll post a message then.
I hope to go as well, I’ll be asking Piketty why he does not give Karl Marx the respect he deserves. I also hope to persuade him to throw down with Furman, in either fisticuffs or a beat poetry slam.
I was thinking about wearing my “Chris Giles: Managerial Class Warrior” tee-shirt to the talk but it’s too yellow.
Gotta be the first time Sarah Carey has paid the slightest attention to anything associated with TASC.
fyi
A new report launched today by TASC provides a detailed analysis of the Irish tax system. While some higher earners will benefit from tax cuts, everyone will lose from the resulting reduction of public services like health, education and social protection. Tax cuts will also reduce funds available for public investment in the economy, which has a vital role in sustainable economic recovery.
Main findings:
•A single person on €40,000, despite paying some tax at the “higher rate”, actually pays less than 10% income tax. On an income of €275,000, actual income tax paid is only 30%.
•If PRSI and USC are included – for a “marginal tax rate” of 52% – in fact a single person on €40,000 only really pays 15.5% of their gross income.
•Two-thirds (65%) of people who pay income tax do not pay anything at the higher rate.
•Only five per cent of people who pay income tax actually pay the higher rate of tax on more than half of their gross income.
•Everyone is a taxpayer, and families on the lowest incomes pay more than a quarter of their income in consumption taxes like VAT and excise.
•The public cost of tax reliefs and tax breaks, which greatly benefit the highest earners, is equal to more than a quarter of all taxes raised. This is far above the European average, and the cost of tax breaks has increased despite the economic downturn.
The report has six recommendations:
•Maintain, and if possible increase, public service provision. Everyone in Ireland benefits from the ‘public value’ of public spending and most people in Ireland would be better off maintaining public services rather than paying less tax.
•If the Government wants to cut tax in one area, they should offset it elsewhere. Introducing a third marginal rate of income tax of 48% on incomes above €100,000 would affect less than one in 20 people who pay income tax, but would raise €365 million to pay for public services or tax cuts.
•Likewise, tax cuts and public services could be funded by reducing Ireland’s high level of non-basic tax reliefs, which cost €9.6 billion in 2010.
•One equitable tax cut would be to remove a ‘step effect’ in the PRSI system. At worst, the current system can require an employer to pay €1,680 to give a low paid employee a net annual raise of just one euro.
•In terms of income tax changes, increasing tax credits rather than changing the 41% rate or the bands would benefit nearly all workers equally in real terms, although some part-time workers would still not benefit.
•Lowering the VAT rate by 1% would benefit far more people than income tax cuts.
http://www.tasc.ie/publications/tasc-a-defence-of-taxation/
fyi
http://www.irishtimes.com/business/economy/piketty-says-property-tax-unfair-and-should-be-altered-1.1832027
fyi
Full transcript: Denis Staunton’s interview with Thomas Piketty
http://www.irishtimes.com/news/world/full-transcript-denis-staunton-s-interview-with-thomas-piketty-1.1831770
Well worth reading …
fyi
Brian Nolan, a professor at the school of applied social science at University College Dublin, has used income-tax records to measure the share contributed by the wealthy in Ireland over recent decades, in the same way that Thomas Piketty and others have done in the US.
His analysis indicates that the proportion of wealth of the most affluent 1 per cent in Ireland fell from about 12 per cent of the total accumulated capital in the country before the second World War to 6 per cent in the 1970s, climbing back to 12 per cent only during the boom years.
http://www.irishtimes.com/business/economy/da-s-capital-how-irish-wealth-is-shared-out-1.1831501
Brian Nolan is a fairly ‘sound’ empiricist ….
… context, and history, of course always matters.
Methinks Piketty might be doing the ‘state’ some service.
WELL DONE TO TASC FOR THE INVITE.
That point in the IT story about those with mortgages paying less property tax than those without is insane.
1. What difference does it make to a local authority what the mortgage on a house is – they still have to provide the same services.
2. So if I’m frugal and pay off as much as possible on my mortgage, I pay more tax than the profligates next door who borrowed more money than me and spend their spare cash on something fun? The more money you borrow the less tax you pay?? WHY???? That’s actually an incentive to borrow more! I thought we were against that?
3. Isn’t one of the benefits of a property tax that it increases the cost of owning a house and therefore acts as a damper on prices and makes it a bit harder for ordinary homeowners to think themselves property investors and get into the BTL market?
Populist nonsense.
@Ernie
Yawn.
Gee I wonder if Piketty had any answers to the “subsidised leverage” crowd here. I’m guessing he did.
Hi. Apologies for delay. Just getting round to report now.
So
First off – Go Croke Park. Hadn’t been in the conference facilities before and it’s most impressive and fancy, though I was sorry you couldn’t get out to the stands to enjoy the stadium. The room was HUGE and Paul Sweeney announced at the beginning that there 650 people there. So Msr Piketty is quite the crowd puller. I arrived early and bagged a seat near the front (shunning those reserved for the media) and kept one for Gavin but he didn’t show! Sob!! Fortunately our other pal (whose name I won’t say because he makes pseudonymous comments here and may wish to contribute his perspective) was also punctual so I had company.
We did some personality spotting. Senators Zappone and McCongail. Joan Burton NOT canvassing. Another theatre chap Willie White. Hans Zomer from Dochas and other faces from the inequality industry. Lots of Labour and trade union types. Loads of academics. Not much media that I could see which surprised me. But the room was crowded and I may have missed many. Oh Peter Matthews of course. However, I was left with the overwhelming impression that it was a left wing audience, and therefore, in one sense it was a wasted effort. Piketty was preaching to the converted. It would more helpful if he was speaking to an audience that needs to be convinced – ie government politicians, employers, etc. He was telling a room full of people exactly what they wanted to hear, which is nice, but how much will that change the public conversation?
Second, For some reason, I can’t say why, I went expecting not to like the guy. I suppose the shock of Krugman still burns. And Furman. Anyway, I expected arrogance, superiority and perhaps a sadistic smile. Obviously French stereotypes are not positive. Anyway! from the get go he impressed. Regular readers might recall the Jason Furman comments that he would be not be as confident as Piketty in making predictions about the future, but he headed this off from the start by discounting his predictions and saying people would have their own ideas. I thought this showed excellent humility though my pal suspected we were being played. Nevertheless, it was a clever move if it was a move.
Then he headed into his thesis and I have to admit it was hard going. If anyone’s heard Alan Taylor speak they’ll know what I mean. VERY intense, constant stream of talking and qualification and comment upon comment with dry jokes thrown in as charts are explained and all in a thick French accent that genuinely required serious focus to understand. I’d say I only processed half of it. His historical references are amazing in their breadth and actually despite swearing not to attempt the book, it made me think I should give it a go.
There’s no point in me going into the substance here as everyone here knows the arguments: suffice to say that I was sold. The data is stark and the quibbles of the FT aside, it makes total sense. The most interesting slide (to me) was showing income tax rates over the 20th century and the 90% rates in the US and UK AND in Germany and Japan for the post WW2 years which were imposed by the Allies, not as a punishment, but because those were the rates in their own countries! Isn’t it mad how those rates seems INSANE now? Look how the thinking has changed. The WW1 destruction of wealth is well documented. I honestly can’t see how anyone could look at his presentation of the data and not be convinced that this is all wrong.
I think most people probably accept it’s right – and actually he’s really just laying out what we already know – the challenge is: what to DO? This is what separates left from right and idealist from pragmatist. The consensus answer (in the political/media sphere) is there’s nothing we can do! Any attempt to tax wealth will simply result in a flight of capital. At the end of the Q&A he became the most animated of his appearance as he said – look, if we get the US and the other Western European countries together and just start this – then it will be a start. You can’t NOT do it, unless everyone does it. (paraphrasing here obviously, but that was the jist, or giste). Don’t let the perfect be the enemy of the good, in other words.
There wasn’t much time for questions but I did get my spake in (thanks to Pat Montague who was running it).
I asked roughly the same question I put to Krugman which is really a political question ; when the data is so stark, and the solution so obvious, why has the political pressure not come from electorates to do something about it? National governments across Europe, including a supposedly socialist government in France, are so slow and conservative to act and instead the political pressure is all about the distributional effects, ie private vs public and young vs old. Why is that?
(Krugman had said – I don’t really know, the lack of political radicalism surprises me and maybe people are too distracted trying to survive. )
and yes! I put the subsidising leverage question.
So the answers!
Well eh, I have to admit that I was at the front standing against a wall when I asked the questions which meant Msr Piketty looked at me directly throughout his very long convoluted answer with his very charming smile and dark eyes and it was all a bit intense given that 650 left wingers half of whom probably thought what’s SHE doing here asking questions at OUR conference? were watching him address his reply to me so really I was thinking oh gosh, he is very dishy isn’t he and really it would be much nicer to listen to him at a cocktail party instead of in front of 650 humourless socialists which is actually a bit embarrassing, and that was all a bit of a distraction, which, taking into account the thick accent, and the volume of words, I really only caught a bit of what he actually said, which I think was:
1. politics – well, governments are starting to act. Why! look at the UK where Labour have proposed a 5% tax on something (houses worth over a million?) and the Conservatives proposed 7% instead! So you see, policies are changing! (that + 3 minutes of other stuff which was generally optimistic)
and
2. well of course, subsidising a leverage is unwise (I had used the phrase unwise) but then he made loads of qualifications about the proposal which included the point that well, at the end of the day, someone with a mortgage has less disposable income that someone without so therefore they can’t afford to pay the same level of property tax. The person without the mortgage must have more “wealth” as they own more of their house. But then went on to make the point Brian O’Hanlon and others made on the other thread which is that it’s not just about the mortgage, overall wealth is taken into account too. The giste I got was that – it was all vastly more complicated than the headline (quelle surprise ) and that I’ll have to study exactly what he meant in totality, because otherwise a lot of populists are going to run around claiming that Piketty said that people with mortgages shouldn’t pay property tax and really, that’s not what he meant at all.
If anyone else was there and can fill in the gaps please do.
Summary: I am charmed by the man, sold on the thesis and may – yes – may just give the book a go.
Oh Paddy Honohan responded but didn’t say anything really new, except that Ireland has no statistics for measuring “wealth” and actually I thought that wisecracks aside, he was a bit flaky. Which was disappointing as I’m a fan. But I guess he has other stuff on his mind. He did say that really, if anything different could be done, it would be done, but they can’t think of anything else that can be done that wouldn’t make everything worse. Maybe he’s right. Sigh.
Nat O’Connor on the other hand also responded and I thought that in the very short time that he had he summed up a few issues very neatly and passionately, including a great chart on the Low Taxes Triangle.
Of course, if you told Irish people they pay low taxes they’d be totally mystified. I think a show on that is required.
Re: Re-stating some of my argument
An architect I listened to speak about Ireland, during the Celtic Tiger years, who had been around for a long time (and remembered the bad old days, the incredible levels of power that the Catholic church, would have held over Irish society), . . . used a phrase, which still ricochets around in my brain, like a piece of shrapnel.
It is a phrase, that I have heard used once on national radio, on a very obscure public radio broadcast about the arts, . . he said, simply, that the Irish were spoiled by poverty.
But what it means, roughly translated back into language, which may not offend, . . . is that in Ireland, we had lots and lots of great and wonderful ideas, long before we had access to any kind of wealth, to do anything with our ideas.
Things do change very rapidly indeed, when finance begins to circulate with an economy, such as that of Ireland’s, . . . as we witnessed a little bit of, during the Celtic Tiger years, under three successive Fianna Fail government administrations.
We can can take a lot of note, of Thomas Piketty’s research and observations based upon that research, . . . at the present, in the middle of austerity, in Ireland, and austerity throughout many parts of Europe (and what’s nice about Thomas Piketty, is that he is one of the few economists out there at present, who does seem to have an ability to place all members of the European union, into one thesis, one debate, . . and that is a valuable contribution to academic conversation, . . because that was lacking).
But the thing that we need to remember, is that Piketty’s ideas apply just as much, in the times of economic expansion, . . as they do, in these present times of austerity.
Even more so.
What the major concern was, in the left wing, side of the debate in Ireland during the 2000’s, I can recall, . . . was the concern, that so little of the wealth that we were able to create, could be funneled into the public purse, and put to use for public utility and benefit.
I won’t repeat that awful phrase, that emanated from the vocal chords of the left wing architect professional speaking in rant, from the mid 2000’s, . . . but suffice it to say, . . that really, here in Ireland we shouldn’t be too hard on ourselves.
We are good at doing austerity.
It’s what we have been used to, and we have grown up with.
What we aren’t really that good at doing in Ireland, is managing our public and private finances, when we do manage to generate economic activity and rising levels of employment. And it doesn’t take an awful lot to generate full employment in Ireland either, . . . if the wind blows in the right direction, and the economies of our neighbours in Britain, mainland Europe, United States and the world in general are in growth.
You try and go out and source labour, in the middle of times of economic expansion, and there is none to be got. But what happens also, in those times of economic expansion, in Ireland, . . . is we forget about the dismal science, altogether, and forget about responsible public policy.
This is the real risk, I think.
I’ve sat in rooms full of six hundred attendees in Dublin, at Joseph Stiglitz talks and Noam Chomsky talks, in the middle of a boom. At least, today in Croke park, the room was packed with 650 Left-ies.
We are incredibly good at doing austerity in Ireland, . . and without protestation. But we make our biggest and most expensive mistakes in Ireland, at times which are not defined as much by austerity, but rather by extremes of affluence and largess (and that’s not so long ago either).
Glad to hear that Piketty’s event was so well attended, and great to see the attendance by ministers and central banking officials also. Maybe if that had occurred during the Celtic Tiger years, we would be much better off now. BOH.
@Sarah
On that tired old canard about taxing wealth leading to flight (and since we’re suddenly paying attention to lefties), see Michael Taft’s recent demolition of the idea.
As for the reason we don’t do it, it should be obvious: we live in a plutocracy, not a democracy. This is both reflected and reinforced by our media, which largely represent the views of their rich owners. The slobs at RTE simply follow their lead. So maybe you should look in the mirror, Sarah. What are you going to do about it?
This is why the wealthy have remained almost entirely untouched in this time of “crisis” while the poor and the disabled and the young have taken it on the chin. Add in the traditional Irish deference to wealth and the confusion of wealth with virtue (evident any time anyone refers to the wealthy as “job creators”) and the media’s job selling the ideological snake oil that is pernicious for society and fatal for democracy isn’t really that tough.
@sarah
Croke Park is an impressive facility, the sound was excellent and the air conditioning was almost enough not to make the room not stuffy and sweaty. Almost.
I have my own impressions of the TASC talk in the Piketty in Ireland thread. I neglected to mention that Piketty was witty, but he was. A good performer and a conscious performer. Charming and a little bit steely.
I would tend to agree with you on the preaching to the converted aspect of the talk, it was definitely not a debate but more of a combined lecture/pep talk/ideological sales pitch training. It was still invigorating to see someone at the top of their game. Patrick Honohan was also interesting and useful, he suffered a bit from the comparison in speaking styles and familiarity with the topic but it was a useful (worrying?) insight into thinking in official Ireland and just how constrained the debate and parameters of policy making are. He did us all a favour by appearing and this kind of public engagement is to be commended, especially in front of a slightly hostile crowd which clearly made him a bit nervous.
Nat O’Connor was also very good as you said, concise and practical. Proinsias De Rossa did a reasonable job at the introduction, even if he is one of the usual suspects. Ireland is so very, very small
There was one thing which infuriated me and it seems to be common at these events. People interpret the “Questions and Answers” session as an opportunity to hold forth on their pet projects at some length and engage in some self promotion even where it seemed to have no bearing on the talk at all. Cringe worthy time wasting and grand standing which stopped other useful questions being asked.
When even the left in Ireland exclusively use tax in a pejorative sense public debate is very screwed up. Do a show.
@Ernie Ball
Honohan had some interesting stuff about the impact on income of the various income deciles in Ireland, the long and the short of it was that for a few years after 2008 income fell more quickly in the upper deciles but now that things have, in some senses, stabilized, their income is climbing again while the lower deciles are stagnating. What growth their is disproportionately goes to the well off.
I am not sure whether the evaluation of income included the relatively higher effects of public service cuts on the poor.
Honohan said at least one other good thing (aimed at the Debraj Rays of the world) which is that though there is nothing earth shattering or hard to discover about Piketty’s theoretical framework (r > g) for academic economists few bothered following the theories to where they led or to establish that the evidence matched the theory. It is one thing to know something but quite another to realize its importance.
I do not think you would have warmed to Honohan but I can not get enough of official Ireland and he is a clever person in an important position. The pattern of omissions and elisions in the official narrative is always interesting (corporate taxation is too complex to talk amount dontcha know, EMU and inflation are a given we have no control over – no point analyzing that or its implications and so on). Honohan was worth listening to closely and he is not foolish enough to imagine that the EU is in this together.
@Ernie
I will facilitate the conversation.
@ shay: ” It is one thing to know something but quite another to realize its importance.”
Nicely put. I shall print out and paste in my scrapbook.
That is, if you do not have an ‘in depth’ context (with a wide lateral also) you are just a ‘talking head’.
Ernie: It has occurred to me on more than one occasion, that the majority of citizens are neither complacent nor fools. They are, for the most part, conservative – small cee, and in political terms are moderate socialists and believe in the Rule of Law. This is where the paradox lies.
Most citizens cannot get their heads around the fact that our current financial crises was caused by widespread and continuous frauds by the chief executives and directors of our banks*, the incompetence of the financial regulator, and the supine behaviour of several Taoisigh and Ministers for Finance. Its not a long list of suspects. Its just completely unbelievable. It takes a lot to convince a law-abiding citizen that they have effectively, been betrayed. its an appalling vista!
The voters will get to have their say at the next parliamentary election. Actually, I believe we will have to have three such elections to bring some closure. We’ll see.
* They made public representations that their respective companies were well managed, solvent and secure for shareholders and investors. The regulator ‘confirmed’ as such. These public representations have since proven to be untrue. That’s a fraud. And B Ahern, in a fit of pique, made such an outrageous comment that he should have been sacked on the spot. Reckless, incompetent fools or mendacious knaves? We will probably never discover the true extent of this.
@ Sarah: Thanks for the time and effort. Like you, I may read TP. Its a great piece of scholarship, but the actual news (inequality – whatever that means) is diverging, is hardly new. Perhaps the acceleration is. Wealth inequality (again, whatever wealth is) has always been the situation since humans first settled down to farm and live in urban settings. And the situation will worsen? We are in the Advent of our Oil Era. Its the decline in the availability our solid, liquid and gaseous fossil fuels that will do for us. I reckon that’s about two decades from now, not 100 years. Thanks again.
@BW Sr
“I reckon that’s about two decades from now, not 100 years.”
oh god. It’s at times like that you think – why did I have children? What on earth is their future?
If I dismiss negative views of the future, it’s not (exclusively) through naivety, but rather the psychological imperative to be optimistic. I think there’s a lot of evolutionary logic in hoping for the best.
@ Sarah: I empathise. I have 3 grandsons (10, 12 + 16) and I have the gravest concerns about their future well-being. We have regular conversations about our fossil-fuel future and the two younger ones are sharp enough to follow the technical arguments (declining production, declining resource quality, increasing domestic consumption in major producers) and to do the appropriate sums – we face a shortage, soon.
The shortage will have the nature of an infection of Dry Rot: slow and insidious. Mind you, if the current Mid East stuff gets rough – expect a price shock (insider traders rigging the market for pecuniary benefit).
The particular sum:
Estimate the No. of litres of liquid fossil fuel (all types) per person per day; given …
world pop = 7 billion
global daily production of LFFs = 90 billion US bbl (1 US bbl = 160 litres approx)
This comes out (near enough), at 2 l/pp/pd. That’s approx what we used in Ireland in the 20s and 30s! At the mo, we use between 6 – 7 l/pp/pd.
In Malawi they get by on 0.3 l pp/pd (bit extreme, but you get the pic). In Chindia the usage ranges from 1.2 – 1.9 l pp/pd. And we expect that global economic activity will ‘recover’ – and we will use LESS fossil fuels to achieve this desirable goal. It will in it’s glue!
Cheers. Brian.