Meanwhile, In Zagreb

Far and away the best feature on the Cato @ Liberty blog is Daniel Mitchell's relentlessly dishonest propagandizing on behalf of the flat tax, conducted primarily through random cherry-picking of Eastern European economic statistics. Today, though, things hit a snag as Mitchell uncovers this tale of an Austrian economist telling Croatians that their current tax status quo resembles Austria's and that they should stick with it. Mitchell is naturally outraged that anyone would ignore the lessons of, say, the Bulgarian miracle:

Too bad nobody asked Professor Widhal why Croatia should seek to have a tax system similar to Austria’s. Unless, of course, Croatia wants to stumble along with growth of 1 percent yearly while its flat-tax neighbors grow by 5 percent annually.



But look here -- Croatia's not growing at 1 percent. It's been growing at . . . a bit less than five percent for years, just like loads of other Eastern European countries. It's almost as if the cause of high growth levels in these states is that the Communist legacy left them poor (small base allows for fast growth) but relatively well-endowed in terms of human capital and thus poised for fairly rapid growth after making the transition away from Communism. The flat tax has pretty much nothing to do with it.