Are Higher Taxes Better? Depends How You Spend Them. With Thomas Piketty

According to economist Thomas Piketty, the debate over whether it's better to raise or lower taxes is pointless if a government does not invest in growth and infrastructure.

Thomas Piketty: Will lower tax lead to higher growth for lower growth? You know, it really depends what's the level of tax you start from in what country and it really depends what you do with your tax revenue. In Europe, it's interesting because we have 28 different countries in the European Union with very different level of taxation. Now the countries with the lowest tax level, countries like Bulgaria or Romania, where the total tax revenue is 20 or 30 percent GDP, whereas the richest countries like Sweden or Denmark have 50 percent of GDP in tax revenue. So if it was enough to have low tax in order to be rich, then Bulgaria and Romania would be richer than Sweden and Denmark and apparently this is not working this way. Probably because what Sweden and Denmark do with their high tax revenue is to invest them in education, in public infrastructure. So if you do useful things with your tax revenue, in fact it can be very good for growth and you need public infrastructure; you need public investment in education in order to grow. Now of course, if you don't to do all these good things with your tax revenue, then higher taxes can certainly be bad for growth. So it all depends what you do with your tax.


Political debates about taxes often revolve around a simple question: Should they be higher or should they be lower? Economist Thomas Piketty argues that this conversation draws the spotlight away from a much more important topic: How do you spend taxes once you've collected them? Poorer European countries like Romania and Bulgaria, which have relatively low tax rates, do not necessarily struggle because their governments don't tax enough. Likewise, Sweden and Denmark are not successful states merely because the tax rate is 50 percent of GDP or higher. What sets these nations apart are the values which inform their tax spending. Sweden and Denmark thrive because they invest so much in education, public infrastructure, and other building blocks for growth and prosperity.

How to make a black hole

Here's the science of black holes, from supermassive monsters to ones the size of ping-pong balls.

  • There's more than one way to make a black hole, says NASA's Michelle Thaller. They're not always formed from dead stars. For example, there are teeny tiny black holes all around us, the result of high-energy cosmic rays slamming into our atmosphere with enough force to cram matter together so densely that no light can escape.
  • CERN is trying to create artificial black holes right now, but don't worry, it's not dangerous. Scientists there are attempting to smash two particles together with such intensity that it creates a black hole that would live for just a millionth of a second.
  • Thaller uses a brilliant analogy involving a rubber sheet, a marble, and an elephant to explain why different black holes have varying densities. Watch and learn!
  • Bonus fact: If the Earth became a black hole, it would be crushed to the size of a ping-pong ball.

Russian reporters discover 101 'tortured' whales jammed in offshore pens

Protected animals are feared to be headed for the black market.

Politics & Current Affairs
  • Russian news network discovers 101 black-market whales.
  • Orcas and belugas are seen crammed into tiny pens.
  • Marine parks continue to create a high-price demand for illegal captures.
Keep reading Show less

China’s artificial sun reaches fusion temperature: 100 million degrees

In a breakthrough for nuclear fusion research, scientists at China's Experimental Advanced Superconducting Tokamak (EAST) reactor have produced temperatures necessary for nuclear fusion on Earth.

Credit: EAST Team
Surprising Science
  • The EAST reactor was able to heat hydrogen to temperatures exceeding 100 million degrees Celsius.
  • Nuclear fusion could someday provide the planet with a virtually limitless supply of clean energy.
  • Still, scientists have many other obstacles to pass before fusion technology becomes a viable energy source.
Keep reading Show less