As occurrences of preventable diseases increase and the debt deepens, some look to “sin taxes” as an easy to solution to both problems. Thirty-three states have even gone as far as to implement a soda tax in an attempt to curb obesity. At first glance sin taxes seem to be a good idea, but they can actually cause more harm than good.

Read more on A Rapidly Expanding ‘Sindustry’…

Is spartan austerity driving us over the fiscal cliff?

The latest step in the budget dance between House Republicans and the White House has to do with where tax increases (or revenue increases in general, depending on what is called what) fit with a deal to avoid the so-called “fiscal cliff.” As Napp Nazworth reports, President Obama has apparently delivered an ultimatum: “there would be no agreement to avert the ‘fiscal cliff’ unless tax rates are increased on those making more than $250,000 per year.”

On one level it seems reasonable to talk about addressing a deficit from both directions: cutting spending and raising revenue. But as Ray Nothstine put it so well earlier this week, without some structural (and cultural) changes to the way Congress works, it would be insane to think that giving politicians more money is going to change how they spend it. One definition of insanity is doing the same thing over and over again and expecting a different result. Historically “politicians spend the money as fast as it comes in – and a little bit more.” Without some kind of balanced budget agreement, something with real teeth, why should we think things will be any different this time around? (I’ve talked about a more promising “both/and” budget solution before.) As Ray and I have concluded elsewhere, “In the case of the federal spending, the government has proved to be untrustworthy with very much. It’s time to see if the politicians in Washington can learn to be trustworthy with less.”
Read more on Spartan Austerity and the Fiscal Cliff…

Jordan Ballor looks at the bipartisan lack of discipline in Washington on debt and spending, and the effect on future generations. “Christians, whose citizenship is ultimately not of this world and whose identity and perspective must likewise be eternal and transcendent, should not let our viewpoints be determined by the tyranny of the short-term,” he writes. “If we continue the current course of American politics, the fiscal cliff will end up being nothing more than a bump in the road toward the cultural, economic and political bankrupting of America.” The full text of his essay follows. The full text of his essay follows. Subscribe to the free, weekly Acton News & Commentary and other publications here.

Read more on Commentary: Living in the Shadow of the Fiscal Cliff…

This week I wrote about the dignity of paying taxes (among other ways of contributing to social flourishing). But as we know, not all taxes are created equal. Indeed, as Antony Davies and James Harrigan write this week at US News, “Politicians are in the business of buying votes with tax breaks and sweetheart deals for their preferred constituencies, and they have to offset these deals by taxing disfavored constituencies at increased rates. The longer this game is played, the more convoluted the tax code becomes.”

As I argued previously at Capital Commentary, this amounts to a kind of back door social engineering (as well as playing favorites, picking winners, and so on). The fundamental purpose of taxation is not to buy votes and give preference to lobbies and special constituencies. Instead, as I write, “The point of taxation is to raise funds to enable the government to fulfill its moral, political, and social responsibilities.” Such a view is ultimately at odds with a Utilitarian theory, which considers taxation to be a tool rather used “to maximize overall well-being in society.” Matthew Weinzierl argues for greater attention to a theory of Equal Sacrifice, which on Weinzierl’s account “assumes individuals have the first claim to their output, and that they voluntarily agree to form societies that collect taxes in order to purchase public goods.”
Read more on Sixpence to the Good (of Government)…

Writing on The American Spectator website, Acton Research Director Samuel Gregg looks at the strange notion of European fiscal “austerity” even as more old continent economies veer toward the abyss. Is America far behind?

Read more on Samuel Gregg: Why Austerity Isn’t Enough…

Why do democracies struggle with debt? One reason, as John Coleman notes, is that one of the problems is that debt is essentially an intergenerational wealth transfer:
Read more on Our National Debt is a Loan from Future Generations…

Would dissolving the European common currency, as proposed by the French free-market economist and entrepreneur Charles Gave in his book Libéral mais non coupable (“Liberal But Not Guilty”) free the Old Continent to stand upright on its financial feet again? Or would dissolving the currency drastically end the European project altogether, as some pro-Euro technocrats in Brussels fear?

Read more on Europe: A Turtle on its Back?…

Kishore Jayabalan, the Acton Institute’s Rome office director, was interviewed by the Zenit news agency in an article titled, “Is Taxing the Church a Real Solution for Italy?” In the article, Jayabalan discusses the history of the Italian state and its imposition of property taxes on the Roman Catholic Church’s land holdings, residences and non-profit businesses.

Read more on Italy’s Tax Man Takes Aim at the Vatican…

Much has been made already about President Obama’s comments yesterday at the National Prayer Breakfast concerning the Christian faith’s teachings about social responsibility. During his time at the breakfast, the president opined that getting rid of tax breaks for wealthy Americans amounted to a Christian obligation:

Read more on The Perils of Presidential Prooftexting…

Last week the Acton Institute hosted its third annual Chicago Open Mic Night downtown at the University Club. Three panelists answered questions about — you guessed it — economics and a virtuous society from the audience.

Read more on Chicago Open Mic Night…