WASHINGTON ¨C The International Monetary Fund spent decades telling the world¡¯s governments how to run their economies on an American-inspired blueprint that became known as the Washington Consensus.
But there wasn¡¯t much consensus between the IMF and the White House on Wednesday when an unusually public disagreement erupted over President Donald Trump¡¯s tax plans.
The flash point was a new IMF paper arguing that developed nations can share prosperity more evenly, without sacrificing growth, by shifting the income-tax burden onto the rich. ¡°Excessive inequality can erode social cohesion, lead to political polarization, and ultimately lower economic growth,¡± it said. The study came out as Trump was hitting the road to promote the biggest overhaul of America¡¯s tax code in decades. The Tax Policy Center, echoing most independent analysts, says that overhaul will benefit high earners most.
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