Club for Higher Taxes?

A New York Times blog called Economix discusses a tax club and advocacy group that desires higher rates of taxation to pay for "the kind of government Americans have made clear they want."

Club Wagner

By David Leonhardt

With this post, we announce the formation of Club Wagner. It’s a (fictional) organization of people willing to acknowledge a basic economic reality: Taxes in the United States must rise.

At their current levels, taxes are too low to cover the kind of government that Americans have made clear they want — a government that includes Medicare, Social Security, a strong military and numerous other programs.

Our club is named after Adolf Wagner, a 19th-century German economist who predicted that taxes would rise as societies became wealthier. “As people grew more affluent,” as the writer Matt Miller has explained Wagner’s Law, “they’d want more of what only government could provide — a strong military, public order, good schools and assorted welfare benefits, services that private citizens would have trouble arranging for on their own.”

Will spending also need to cut? Yes, especially health care spending. But spending cuts won’t be enough. Taxes will also need to account for a larger part of tomorrow’s gross domestic product — just as they account for a much larger share of G.D.P. now than they did a century ago. Done right, tax increases do not have to stifle economic growth.

The charter members of Club Wagner include:

* Roger Altman, who wrote an op-ed in The Wall Street Journal last week titled, “We’ll Need to Raise Taxes Soon.”
* Mr. Miller, whose book, “The Tyranny of Dead Ideas,” devotes a chapter to the subject.
* Bruce Bartlett, the former Reagan adviser.
* Peter Orszag, the Obama budget director (even if he doesn’t talk much about his membership these days).
* Judd Gregg, the ranking Republican on the Senate Budget Committee (even if he also talks publicly about cutting taxes).
* Kent Conrad, the chairman of the Senate Budget Committee (even if he won’t propose specific tax increases).
* Douglas Holtz-Eakin and Dan Crippen, former directors of the Congressional Budget Office who advised the 2008 McCain campaign.
* Fred Hiatt, the editorial page editor of The Washington Post, who laid out his case in a column on Monday.

Any other nominees?

Hat tip to Greg Mankiw, whose Pigou Club — “elite group of pundits and policy wonks with the good sense to advocate higher Pigovian taxes” — is the inspiration for Club Wagner.

Come to think of it, the Pigou Club and Club Wagner are natural allies.