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Sunday, March 27, 2011

Ezra Klein wonders why Lawrence Kudlow can't understand why Obama might sincerely disagree with him.

I'm not sure my comment appeared there.

This isn't exactly your topic, but this is a very strange time to discuss a corporate tax holiday. Large US corporations are flush with cash and don't know what to do with it. They aren't investing because they have spare capacity.

The effect of repatriation of profits on investment would be unusually low if it happened about now -- the fraction going to share buybacks and dividencs would be high. If anything we want them to keep the profits overseash now and bring them back later, when their investment is constrained by the cost of capital (as it usally is).

Of course this just means that, for Republicans, it is always time to cut taxes on corporations, and since all they have is a hammer all problems look like nails and well we know all of that.

Actually I have just come up with an on topic question. You find it odd that Kudlow can't seem to understand why Obama might disagree with him even if Obama doesn't want to hurt US capitalism. Ballance* says that you should claim you understand the logic of Republicans policy arguments. I say you are very very smart, but you can't think of a rationale. I repeat my admiration for you, but I don't think it is humanly possible. Heeeyyyy maybe the reason they think Obama is trying to destroy US capitalism is that they are (takes one to know one). That's crazy but you have to admit that it sure seems to fit the facts.

*that would be then former congressman Jack Ballance (D of course) who was listed in this paper on a scorecard of corruption to achieve a balanced result by breaking the rules laid out in that very article.

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