The Dilbert View

scottadamsThroughout this election season, Scott Adams (the Dilbert guy) has been right when I (and a whole lot of others) have been wrong. On his blog, Adams kept patiently explaining why Donald Trump would be a strong contender, while I and a great many others believed (or maybe just hoped and therefore believed we believed?) that Trump was a flash in the pan. Each of the many times that Trump seemed to take himself out of contention, Adams predicted he’d survive and even thrive — and each time, Adams was right.

Now, however, Adams has turned his attention from Trump’s merits as a candidate (where Adams seems to have had a great deal of insight) to Trump’s merits as a potential president. And here, despite all his past successes, I am quite sure that Adams has outrun his expertise. Policy analysis and political analysis are, after all, two very different things.

From Adams’s most recent blog post:

My current tax rate is about half of my income when you add up all of the various taxes. I don’t have many deductions. Clinton proposes an estate tax that would take about half of what is left. In effect, Clinton wants my tax rate to be around 75% for every dollar I earn today. That level of taxation would make me feel like a government employee.

First of all, 75% is probably a considerable underestimate; it fails to account for the fact that Adams’s income is already being taxed three or four times, once when he first earns it, again as it throws off a stream of interest, dividends, and/or capital gains, and again as corporate taxes are taken out before he even sees those dividends and capital gains. Not to mention sales and property taxes.

And second of all, yes, some taxes are worse than others and the estate tax, with its associated incentives for rich people to overconsume, is among the worst.

But Adams is fooling himself if he thinks his taxes would be substantially lower under Trump. Ultimately, our tax burden is determined entirely by the amount the government spends. The more they spend, the more they must tax. The taxation can be briefly deferred through borrowing, but ultimately those debts come due and taxes — either on Scott Adams or on the heirs he’s looking out for — must rise.

And here’s the thing: Trump has given us no reason to think he’d spend any less than Clinton would. When you ask him what he wants to cut, his standard answer is “waste, fraud and abuse”. Unless you interpret the words “waste” and “abuse” to mean something like “everything done by the departments of Commerce, Labor, Agriculture, Energy and Health” — and it’s quite clear from context that Trump means no such thing — you’re not going to make a dent in spending. If you make no dent in spending, you can make no dent in taxes. So unfortunately, Scott Adams, you and I are all going to be government employees for a long time, no matter who wins.

Moreover, Trump is calling for a huge additional tax burden on top of all this, namely a system of tariffs that is designed to increase prices of consumer goods by up to 40%. Some of the revenue from those tariffs will make it possible to lower other taxes, but you’ll still be paying just as much overall, and via a tax that’s likely to be even less efficient than estate taxation, which means that the burden (after accounting for changes in consumption patterns, etc.) will be even greater.

Here’s Adams again:

Ironically, we have the two “worst” candidates of all time, according to their favorability ratings. But those two worst candidates have given us two of the best (clearest) choices we have ever had as a country….Sure, both candidates are flawed, but both have the capability to deliver on their main propositions. Clinton probably can give you a third term of Obama(ish) and Trump probably can drain at least some of the swamp.

But —- Trump has shown absolutely no interest in draining the swamp. None. The swamp is his beloved home (it’s Clinton’s too, of course). Trump hasn’t mentioned a single significant government program that he’d kill off. He wants to expand the government’s role in the economy, by dictating (to a much greater extent than currently) who you’re allowed to trade with, who you can hire, and who you can work for. He, like Clinton, wants to forcibly redirect resources to his favorite industries (in her case, renewable energy; in his case, manufacturing). This kind of governmental favoritism for one industry over another is exactly what the swamp consists of. The whole problem is the misuse of government power to control how people choose to allocate their resources and run their lives. Clinton wants more of this. So does Trump.

The good news, if you’re a mainstream Democrat, is that you can’t lose this election. Clinton wants bigger and more intrusive government with more spending (and hence necessarily higher taxes); so does Trump. The bad news, if you’re a mainstream Republican, is that you can’t win. There is no hope that either of these candidates will pursue the sorts of drain-the-swamp policies that I would like to see and that Scott Adams says he would like to see. The only question is where Adams came by the bizarre notion that things might be otherwise.

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33 Responses to “The Dilbert View”


  1. 1 1 acarraro

    Isn’t Scott Adams argument even worse?

    The likely distributional effect of the tax increases under Clinton and Trump is very different. High earners might get much higher taxes under Clinton, but this is not really true for middle to low earners. Almost by definition high marginal taxes are going to move the burden to high earners. Trump implicit trade taxes are likely to be regressive instead.

    So if you earn more than 250k, but all means vote for Trump, but anybody earning less than that shouldn’t really care about the tax hikes…

  2. 2 2 Harold

    I don’t understand why anyone thinks Trump will do anything except what is best for Trump. He demonstrates this again and again. Boasting about making personal gains from his corporate bankruptcies is an example that demonstrates that he views everything through the Trump lens. Blatant lying does not affect his ratings.

    I read Scott Adams’ earlier posts as him as a commentator and observer, but his campaigning for Trump is now overt. The list of Trump v Clinton risk factors is absurd.

    He may be right about some things, but it is very disappointing if he is. Adams says “Remember, facts don’t matter. Policies don’t matter. They never did. People care about their “tribe.” People care about their income. And people care about their fears. Everything else is less persuasive.”

    If it is true now, I am not sure that it always was. Someone said “Its the economy, stupid” and pretty much everyone accepted that as a succinct evaluation. That meant attention to policy. If Adams is right that has changed, and now it is all about fear and xenophobia. Very sad, but why has this happened?

  3. 3 3 Sub Specie Æternitatis

    @Harold:

    If it is true now, I am not sure that it always was. Someone said “Its the economy, stupid” and pretty much everyone accepted that as a succinct evaluation.

    That was James Carville’s slogan for the 1992 campaign against the reelection of George Bush. Candidate Clinton claimed that the US was mired in the worst recession since the Great Depression.

    In fact, the 1990/91 recession was one of the mildest in 20th century history and, by election day 1992, the 1990s “Clinton boom” had been underway for a year and a half.

    Clinton defeat Bush decisively.

    Politics has not been about policy, as Robin Hanson so succinctly puts it, at least since the advent of the universal franchise.

  4. 4 4 Ken B

    @Steve
    That’s only part of draining the swamp. Part of the swamp is the weaponized use of bafflegab and political correctness.

    @Sub
    My slogan for this election is “It’s the contempt, stupid.”

  5. 5 5 Ken B

    As a Canadian I am struck by (and I am sorry to offend some here I much admire) American ignorance. Libertarians tend to forget or ignore how efficient and effective and basically honest the American government has been at some times in American history. Liberals tend to imagine it still is and always will be. Everyone tends to forget the rancor and division of prior elections. It’s not just that I recall photos of Bush as a monkey or with bloody fangs from the remote past of 2004. I recall reading of a small kerfuffle in the the 1860s. After the revolution there was a mass exodus of Empire Loyalists into the colonies that became Canada. When I was a child there were assassinations, murders, and riots in the streets.
    My point? I’m not sure, I think I am just frustrated by those who are so certain they know things they cannot know. So I am going to link a piece I think sums up my feelings in an appealingly uncertain way.
    https://ricochet.com/386528/how-i-might-be-wrong/

  6. 6 6 Ken B

    FWIW I disagree with Rahe’s conclusion. Since Obama says I can vote I can happily announce my refusal, not simply my inability, to vote for either Trump or Clinton.

  7. 7 7 Ken B
  8. 8 8 Harold

    “Clinton defeat Bush decisively.” May have been down to another soundbite “read my lips – no new taxes”. Bush may or may not have been at fault for the new taxes, but he gained in the previous election for making the claim and it came back to bite him. Bush was unable to back away from the claim as Trump seems able to back away from his extreme claims with impunity. I can scarcely believe that the Trump campaign can make honesty a point to try to win votes.

    Sure, it was never all about the economy, or all abut any one thing. Facts were never the only thing, policy was never the only thing. But I think in the past they were at least something. They did matter. This time round they don’t seem to matter at all. This time does seem different.

  9. 9 9 Ken B

    @Harold 8
    Yes, that was key. You can’t make a promise the way Bush 1 did, with that read my lips stuff, and then break it.

  10. 10 10 Harold

    #9 Trump seems to be able to.

  11. 11 11 Roger

    Naming specific programs to kill is not a winning political strategy. It will be up the Republican House to cut spending, and they are much more likely to be successful with a Republican President.

    Trump may not drain the swamp, but there sure are a lot of Democrats who are scared to death that he will.

  12. 12 12 Ken B

    Harold 10
    Really? Trump won his re-election already?

  13. 13 13 Bennett Haselton

    I know this wasn’t your main point, but:

    If Scott Adams claims to have predictive abilities that do better than the betting markets — whether because of his “theory of persuasion”, or whatever — then it would be incumbent on him to put that theory to use in the betting markets, and profit wildly. If he doesn’t, then I’m inclined to think his “theory” wouldn’t do better than chance in the long run, even though it would occasionally produce some individual successes, such as if he had placed a long-shot bet on Trump.

  14. 14 14 Zazooba

    I keep saying it.

    Any serious analysis of Trump’s appeal has to seriously consider immigration. Any analysis that doesn’t seriously consider immigration is not a serious analysis.

    Nobody thought any of the Republican candidates were going to seriously cut the size of government or seriously cut taxes. They all said they would, not nobody took any of them seriously. That’s why they all sounded so tinny in the primaries.

  15. 15 15 Floccina

    But Bill Clinton’s wife is a little more hawkish than Fred Trump’s son and war is costly. She says wants to enforce a no-fly zone in Syria. She is also an enthusiastic drug warrior.

    It looks bleak at least 4 more years of Middle-East war and drug war.

    I will vote for Gary Johnson but he will not win. Why do so many people support the drug war and can we turn them from it?

  16. 16 16 Zazooba

    Adams’s claim to fame is that he saw early that Trump had stumbled on a real issue (immigration) that mattered to a lot of people.

    That was Adams’s one insight. He’s a hedgehog. But, for about a year, he was one of the few who saw this, so his one insight made him golden for more than a year.

    Beyond his one golden insight, though, he doesn’t seem to be very insightful.

  17. 17 17 Richard D.

    SL:
    “Ultimately, our tax burden is determined entirely by the
    amount the government spends. The more they spend, the more
    they must tax. The taxation can be briefly deferred through
    borrowing, but ultimately those debts come due”

    I don’t see how borrowing defers taxation. The real tax
    is determined entirely and immediately by real resources
    consumed or transferred by gov’t.

    If the king decides to give 1000 bushels of potatoes to The
    Poor, he first has to seize 1000 bushels of potatoes from
    the harvest. Bingo, there’s the tax, borrowing doesn’t
    defer it.

  18. 18 18 Neil

    If Adams actually pays half his income in tax, he needs to emulate his hero Donald Trump and find a good tax accountant. Only rich idiots pay that much.

  19. 19 19 Steve Landsburg

    Richard D.: If the king decides to give 1000 bushels of potatoes to The Poor, he first has to seize 1000 bushels of potatoes from the harvest. Bingo, there’s the tax, borrowing doesn’t defer it.

    Mostly yes — this is right, and gets at the heart of the matter. But the govt’s decision to finance these 1000 bushels via borrowing (as opposed to immediate taxation) can change the way other people allocate their resources across time and so can shift the ultimate tax burden around a bit.

    Example: Suppose you are thinking of taking a $1000 vacation this year. Unfortunately, the only way to get that $1000 is to borrow at the going rate of 5% — and that’s more than you’re willing to pay. If only the rate were 3%, you’d happily take that vacation.

    Now the govt suddenly cuts your taxes by $1000, borrowing the $1000 at 3% and promising to come after you in the future for the revenue it needs to pay off the debt. As far as you’re concerned, the govt has just lent you $1000 at 3%. (That is, they’re putting an extra $1000 in your pocket now and promising to take it back, with interest, in the future — that’s the equivalent of a loan.) This is just what you wanted, so you go to Hawaii. As a result, you consume more now, and less in the future, than if the govt had taxed you this year.

    But again, the main point is exactly as you said it is — the govt claims 1000 pounds of potatoes, and that 1000 pounds is gone instantly. On the other hand, the choice between taxation and borrowing might influence someone else’s decision about how many potatoes (or Hawaiian pineapples) to eat this year.

    Bottom line: In order to give 1000 bushels of potatoes to the poor, he first has to seize 1000 bushels of potatoes from the harvest. Yes, absolutely, and that is the heart of the matter. But the *way* in which the govt grabs those potatoes could influence your decision about whether to go to Hawaii this year, and hence influences the total quantity of resources claimed by both you and the govt.

    When govt claims $1 worth of resources, $1 worth of resources is gone, instantly. If they choose to claim it via borrowing rather than via immediate taxation, then it’s possible that individuals will also, as a result, claim more immediate resources.

  20. 20 20 Steve Landsburg

    Richard D: Or another possibility: Instead of claiming 1000 pounds of American potatoes, the govt borrows 1000 pounds of Chinese potatoes. The world economy immediately takes the 1000-pound hit, but Americans are not on the hook for this till next year. (Of course, foreseeing that burden, Americans might choose to save more this year, which reduces their consumption as if the govt had taken 1000 potatoes from Americans. But it does mean there are other possibilities…)

  21. 21 21 Max

    It’s simplistic to assume that cutting Scott Adam’s taxes (holding current spending constant) will simply rebound to higher taxes on his heirs. That’s just one possibility. Others are that the money will come from higher taxes on the rich (as opposed to the super-rich) and/or middle class, or that it will come from foreign bondholders, or that future governments will respond to financial pressure by cutting non-military spending. Or even, that the bill will never come due! (i.e. natural tax revenue growth outpaces interest payments).

    If all he cares about is money, he’s probably doing the right thing in voting for Trump.

  22. 22 22 Harold

    #12 – I forget that most people do not have access to my “future vision” goggles!

    You are right that the situation is not quite the same as the Bush “no new taxes”, but there are parallels. Trump gets away with blatant lies with apparently no political cost, to the extent that he is making honesty part of his campaign! This is really quite astounding given that he has more “pants on fire” ratings by independent checkers than anyone else by a long, long way. His supporters simply do not care about it.

    It is consistent with this that if Trump comes up for re-election, a contradiction on the scale of “no new taxes” would be similarly ignored. I concede that this has not yet happened.

  23. 23 23 Ken B

    22
    I kept hearing that Trump was teflon and getting away with stuff during the primaries. I don’t think so. I think he was poisoning wells and storing up wrath. And I think I have been vindicated. Any decent republican would be miles ahead of Hillary Clinton. Kasich would have won a landslide. Trump may well lose, and if he does win it will be only because of wikileaks and the deplorables speech. That doesn’t add up to Trump getting away with stuff.

  24. 24 24 Harold

    #22 That may be part of it, but it is not the whole reason otherwise the Trump campaign would not be using honesty as a weapon.

    It seems that any decent republican would be miles ahead of Clinton and any decent democrat would be miles ahead of Trump. Funny old world.

  25. 25 25 David Grayson

    The “I” in Dilbert should not be capitalized in this blog post’s title.

  26. 26 26 Steve Landsburg

    David Grayson: Thanks! Fixing….

  27. 27 27 nobody.really

    I kept hearing that Trump was teflon and getting away with stuff during the primaries. I don’t think so. I think he was poisoning wells and storing up wrath. And I think I have been vindicated. Any decent republican would be miles ahead of Hillary Clinton….

    It seems that any decent republican would be miles ahead of Clinton and any decent democrat would be miles ahead of Trump. Funny old world.

    This is just restating the familiar game-theoretical problem of ethics: Ethics consist of the list of policies that make society desirable. You want to win, and sometimes you can win by violating these rules. But if enough people do this, they debase the very prize that they’re fighting over.

    This applies to leadership. The leader of a group wants to have a strong group. Yet to become the leader, you must first wage war on the potential rivals for leadership within your group—which will inevitably weaken your group, at least in the short run.

    This dynamic applies to the political parties—but especially to the Republican Party. Each party must wrestle with the fact that they pick their national candidates on the basis of primaries of party loyalists—and these loyalists are not representative of the national as a whole.

    Thus, following the Republicans’ 2012 defeat, the party conducted an “autopsy” and concluded that the party would need to attract more minorities if they were to win. That’s a great observation—from the perspective of someone who already has the party’s nomination. But Trump (and Cruz before him) realized that a large share of the people in Republican primaries found this recommendation alienating. By reassuring aging white Republican primary voters that they really didn’t need to eat their spinach, Trump was able to win the nomination. Yet in doing so, he pretty much destroyed any real chance of Republicans winning the White House.

    Republicans can blame Trump for this kind of demagoguery. But it’s unclear that, in the absence of Trump, Cruz wouldn’t have fallen into the same pattern. To avoid this pattern, all Republican candidates would have had to behaved ethically—that is, would have had to sacrifice a strategy that could benefit themselves personally in order to preserve the larger societal benefit (in this case, the benefit of providing the Republican Party with a viable candidate). Where can we find a party full of only self-sacrificing candidates? Not in the GOP, clearly.

    I suspect the problem is intractable. In short, this election will turn out pretty much as we could have predicted in 2012: Democrats will win because of the ethnic composition of the electorate. Someday another party will attract enough non-white votes to win–but until enough aging white Republican primary voters die, that party will not be the Republican Party.

    This is a problem than only time can solve.

  28. 28 28 Ken B

    It’s not that I disagree with Steve, because mostly I do agree, but I wonder if he hasn’t shrugged off his past errors too lightly (and me too.) A central theme of Adams’s this election is that *you don’t see Trump accurately*. I certainly did not; I thought he would flamboyantly and petulantly withdraw long ago. Oops. But Steve’s argument here is based solidly on *the same view of Trump he has espoused here for months*. Or so it seems to me.

  29. 29 29 Harold

    “This is a problem than only time can solve.”
    Well if was a problem it didn’t take quite as much time as you thought!

    SL. “The good news, if you’re a mainstream Democrat, is that you can’t lose this election. Clinton wants bigger and more intrusive government with more spending (and hence necessarily higher taxes); so does Trump.”

    That is wrong – Democrats do not want bigger and more intrusive Government. They want things that will result in bigger and more intrusive Government. What those things are does matter.

  30. 30 30 nobody.really

    This is a problem than only time can solve.

    Well if was a problem it didn’t take quite as much time as you thought!

    Ok, ok, you got me. As it turns out, there’s still some more juice to be squeezed from the old lemon. Who knew?

    But how much juice? If you go back to squeeze it again in four years, what will we get? Eight years? I still think time is not a neutral factor here.

  31. 31 31 iceman

    Nobody – there are certainly LT demographic forces at work, as well as the standard strategic problem of needing to be extreme for the primaries and more moderate for the general (at least that’s how it usually works). Where I think people really got over their skis in recent months was in looking at the idiosyncratic results of that process this time around and making sweeping pronouncements about the past and future of the parties.
    IMO the truth is probably simpler — in a year supposedly of “change” and “anti-establishment” sentiment, each party had a charismatic “outsider” capture the imagination of wing-base voters, both of whom seemed easily beatable by a more serious candidate (at least until yesterday). The difference was the DFL had undemocratic rules to override this outcome, while the GOP really wished it did.

  32. 32 32 Richard D.

    If the king decides to give 1000 bushels of potatoes to The Poor, he first has to seize 1000 bushels of potatoes from the harvest. Bingo, there’s the tax, borrowing doesn’t defer it.

    SL:
    ********************************
    Mostly yes — this is right, and gets at the heart of the matter. But the govt’s decision to finance these 1000 bushels via borrowing (as opposed to immediate taxation) can change the way other people allocate their resources across time and so can shift the ultimate tax burden around a bit.

    Example: Suppose you are thinking of taking a $1000 vacation this year. Unfortunately, the only way to get that $1000 is to borrow at the going rate of 5% — and that’s more than you’re willing to pay. If only the rate were 3%, you’d happily take that vacation.

    Now the govt suddenly cuts your taxes by $1000, borrowing the $1000 at 3% and promising to come after you in the future for the revenue it needs to pay off the debt. As far as you’re concerned, the govt has just lent you $1000 at 3%. (That is, they’re putting an extra $1000 in your pocket now and promising to take it back, with interest, in the future — that’s the equivalent of a loan.) This is just what you wanted, so you go to Hawaii. As a result, you consume more now, and less in the future, than if the govt had taxed you
    this year.

    … Bottom line: In order to give 1000 bushels of potatoes to the
    poor, he first has to seize 1000 bushels of potatoes from the
    harvest. But the *way* in which the govt grabs those potatoes could influence your decision about whether to go to Hawaii this year,
    and hence influences the total quantity of resources claimed by
    both you and the govt… If they choose to claim it via borrowing
    rather than via immediate taxation, then it’s possible that
    individuals will also, as a result, claim more immediate resources.
    **************************************

    OK, this is possible because we live in a money economy,
    and some are willing to defer consumption, for investment
    today; i.e. someone buys the gov’t bond.

    Usually, when discussing economics, I try to reduce to a
    barter economy, in order to crystallize the issues. Money
    tends to obscure and complexify; for instance, we see the common
    pernicious fallacy, “Money is wealth”.

    Even so, it’s still the case, that Wilma the Widow gets free
    potatoes, gratis the king, while Tom Taxpayer goes hungry.
    However, Tom’s hunger pangs might be deferred, if Bill Bondbuyer
    opts to go hungry in his place, this year.

    So in that sense, spending and taxation are immediate and coterminous, and I guess we’re both right.

    Also, your example of the 5% loan magically transformed into 3%
    via the printing press, resulting in a cheap vacation, bothers
    me, though I’m not sure how to refute it. Likely through an
    inflation argument – everyone else pays.

  33. 33 33 Steve Landsburg

    Also, your example of the 5% loan magically transformed into 3% via the printing press, resulting in a cheap vacation, bothers me, though I’m not sure how to refute it. Likely through an inflation argument – everyone else pays.

    No, it’s not the magic of the printing press; it’s the magic of debtor’s prison.

    Suppose you want to borrow from me. You’re willing to pay 3%, and I’m willing to accept 3%, *provided* I know you’ll repay. But because there’s a risk you’ll default, I demand 5%, which you won’t pay, so we don’t have a deal.

    Now comes the government, promising to throw you in prison if you don’t pay. This gives me the confidence I need to lend to you at 3%, and gives you the incentive you need to repay me. We are therefore both better off.

    Or alternatively, suppose the govt lowers your taxes, borrowing the money from me. I’m willing to lend at 3% instead of 5% because I trust the govt to repay. This is the same good outcome as above. But what drives this good outcome? It’s the fact that I trust the govt to repay. Why do I trust them to repay? Because I trust them to get the money from *you* via future taxes. Why do I trust that you’ll pay those future taxes? Because the govt will jail you if you don’t.

    So govt borrowing makes us both off by effectively lending you money and promising to jail you if you don’t repay — and is therefore a perfect substitute for the threat of debtor’s prison.

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