A.G.,
Are suggesting that the AP test has a question like this?
Americans are: a) over-taxed; b) under-taxed; c) taxed just right; d) taxed lower than other industrialized countries; e) none of the above
If so, I fear for our kids.
There is a book whose title escapes me that goes into the history of the federal income tax. It is nothing short of incredible how we have changed our collective minds about taxation through the years. Shivas is absolutely right about picking your timeframe.
BTW, do you teach your kids about the evil of the huge budget deficit and how it spells doom by crowding out private investment? Do you point out to your students that as a % of GDP it is well in the historical range? Or is a comparison to GDP and a particular timeframe not appropriate in this instance?
Lou,
There is no such question; it would be a normative rather than positive question, and the AP exam is purely positive. For the record, though, I never said that we were undertaxed. I said that the idea that we are overtaxed is crap, and cannot be factually demonstrated. I'll stand by that, either in an historical context, or a comparison with other industrialized nations.
It is a matter of fact that federal govt. spending right now (as a % of real GDP) is below the average of the past 20 yrs., and that tax revenues as a % of GDP have declined even more. That is, in fact, where the current deficits come from. I don't care what you do with that information as far as what a proposed remedy might be.
I do in fact teach "crowding out" as the real problem with deficits (as opposed to the "future generations paying our bills" stuff you normally hear), which has been part of the long free-response question on the AP Macro exam 12 of the past 14 years. I also teach that as a % of GDP our deficit is not extremely high by current world standards; that is an appropriate reference.
BTW, I am still in favor of munis!
