The room at the National Press Club in Washington, D.C., was packed as Boston University economics professor Laurence Kotlikoff prepared to address them last week. In attendance were economists from the Treasury, the Congressional Budget Office, Washington-D.C. think tanks and the staff of the tax writing committees on Capitol Hill. They came to witness something economists had never seen before.
What Kotlikoff unveiled were the results produced by he, U.C. Berkeley economist Alan Auerbach and two of their colleagues: a calculation of the lifetime consequences of earning extra income, in light of 30 different federal and state tax and entitlement programs.
The results were stunning.