Scottish "Independence" manifesto

[Ban Kenobi]

That is not an externality. That is actually a deadweight loss.

If I work for an employer a third party benefits because I have to pay taxes on the income received. Please consult the definition of "externality".

[Hauldren Collider]

If I work for an employer a third party benefits because I have to pay taxes on the income received. Please consult the definition of "externality".

You are the one who needs to consult the definition of externality. A third party benefits because of a price that you directly pay. An externality is a benefit or cost not priced into the market. kthxbye

[Hauldren Collider]

It is hilarious that Ban Kenobi thinks that taxes are externalities, especially considering pigovian taxes are generally the SOLUTION to externalities

That said, Ban K, your confusion is understandable. It is true that we encourage household production via the tax wedge, more than would otherwise occur. But it is not an externality, and government provided daycare would not result in the socially optimal consumption of daycare.

[kentonio]

this appears to be about the oil fund. i don't think anyone disputes that scotland, like almost every other country in europe, runs a fiscal deficit. however this hardly precludes raising extra money through other means.

They claim they aren't going to raise tax, and are going to cut corporation tax.

well, it's not surprising that the SNP are putting the best gloss on the case for independence. if i were a scottish voter, the EU entry would be important to me (or rather keeping the free trade etc.), and it seems unlikely that there will be any serious problems in this regard.

There are very real issues and not addressing them is an attempt to decieve the Scottish public. What about Schengen? What about teh UK only vetos that are going to be lost?

why would the rest of the UK have to 'go along with it'? does the US 'go along' with ecuador and zimbabwe using the dollar? in any case i don't see why it would be in the rest of the UK's interests to cause problems.

The Scottish don't need us to 'go along with it' if the BoE are going to continue to control the financial levers, but the SNP are claiming that they will retain influence on the BoE which is a complete lie. If they want to use a currency that they have no control over and which the BoE could change interest rates without any regard to the Scottish economy, then they're more than welcome, but they need to be truthful about that.

NATO membership seems trivial frankly, and i'd imagine that's the view of most scottish voters.

So basically you think Scotland should have no global defense ability and just take advantage of its neighbours defending it by proxy without any Scottish contribution?

[Ban Kenobi]

You are the one who needs to consult the definition of externality. A third party benefits because of a price that you directly pay. An externality is a benefit or cost not priced into the market. kthxbye

1. That is not the definition. Here, let me help you:

A consequence of an economic activity that is experienced by unrelated third parties. An externality can be either positive or negative.

http://www.investopedia.com/terms/e/externality.asp

The first and second parties are yourself and your employer. The government is an unrelated third party.
2. Even if this wasn't an "externality" it wouldn't change the fact that decisions parents make regarding the choice between working and staying home with the kids reflect the private value of choosing to work, not the total social value which is greater.

[Hauldren Collider]

You're an idiot. The government is not an unrelated third party, they are ****ing taking your money. Directly.

2. Even if this wasn't an "externality" it wouldn't change the fact that decisions parents make regarding the choice between working and staying home with the kids reflect the private value of choosing to work, not the total social value which is greater.

Dude, the social value IS THE PRIVATE VALUE. If you ever took an economics class, did you pay attention to any of it? That is one of the most fundamental concepts.

Just admit you are wrong. There is no shame in it, and the hurt will stop. Your original misconception was a totally reasonable one.

[Ban Kenobi]

You're an idiot. The government is not an unrelated third party, they are ****ing taking your money. Directly.




Dude, the social value IS THE PRIVATE VALUE. If you ever took an economics class, did you pay attention to any of it? That is one of the most fundamental concepts.

Just admit you are wrong. There is no shame in it, and the hurt will stop. Your original misconception was a totally reasonable one.

If I earn $100 and pay $30 in taxes, the social value of my labor is $100 and the private value is $70 because that's what I get to keep. I only take the $70 into consideration when deciding whether to work. Do you see how parents might not necessarily make economically efficient decisions wrt to working and paying for daycare vs. staying home?

[Hauldren Collider]

If I earn $100 and pay $30 in taxes, the social value of my labor is $100 and the private value is $70 because that's what I get to keep. I only take the $70 into consideration when deciding whether to work. Do you see how parents might not necessarily make economically efficient decisions wrt to working and paying for daycare vs. staying home?

Yes, I did, which is why I said this:

That said, Ban K, your confusion is understandable. It is true that we encourage household production via the tax wedge, more than would otherwise occur. But it is not an externality, and government provided daycare would not result in the socially optimal consumption of daycare.

[Hauldren Collider]

I am about 70% confident that Ban K is gribbler. To clarify, I don't think you're an idiot and have perhaps been too harsh. But you're simply wrong wrt externality. Totally right on the fact that we encourage household production with taxes however.

[DaShi]

I think he's a new poster with no prior connection to or knowledge of this forum.

[Ban Kenobi]

It's bizarre that you simultaneously recognize that the government is promoting household production and insist that people are making efficient decisions regarding whether to stay home with the kids or hire a daycare and get a job.

[Hauldren Collider]

It's bizarre that you simultaneously recognize that the government is promoting household production and insist that people are making efficient decisions regarding whether to stay home with the kids or hire a daycare and get a job.

Your solution is far less efficient. The only way to reduce this particular inefficiency is to cut taxes, since we essentially define household goods as things that are impossible to tax. It might be possible to concoct some immensely complicated subsidy for child care that would counteract this, but it makes more sense to simply accept the fact that some distortions will inevitably occur under any tax regime.

Anyway, as I said, free daycare would clearly be massively more inefficient.

[Ban Kenobi]

Your solution is far less efficient. The only way to reduce this particular inefficiency is to cut taxes, since we essentially define household goods as things that are impossible to tax. It might be possible to concoct some immensely complicated subsidy for child care that would counteract this, but it makes more sense to simply accept the fact that some distortions will inevitably occur under any tax regime.

Anyway, as I said, free daycare would clearly be massively more inefficient.

Scotland can't have a socialist welfare state if they cut taxes. That's why they need to create incentives to work that would otherwise be unneeded. They also need to encourage people to have children or else their welfare state will collapse under the weight of an aging population.

[Bugs ****ing Bunny]

pensions are going to be a challenge for all developed countries. however, i think the worries are overblown. all that needs to happen is for productivity to rise faster than the worker to pensioner ratio.

It's not just the ratio of workers to the (increasing) raw numbers of pensioners that poses the problem.

There's also the unprecedentedly and high and rising lifespans. And also the unprecedentedly generous terms (set to outstrip wages and inflation).

That escalation measure is more generous than I've seen on the current conditions of any final salary pension scheme. The fact that "we've always managed it before" is no guarantee of future succes, particularly with all those unprecedented factors coming into play.

[Bugs ****ing Bunny]

Scotland can't have a socialist welfare state if they cut taxes.

Yes they can, if they have oil.