If Taxpayers Can't Be Fooled, Maybe Congress Can: A Public Choice Perspective on the Tax Transition Debate
In When Rules Change: An Economic and Political Analysis of Transition Relief and Retroactivity , Shaviro takes the various strands of the existing literature on retroactivity and weaves them together, applying his unique combination of legal expertise, political pragmatism, and theoretical sophistication in public finance economics as well as political science. The result is a subtle, balanced, and scholarly treatise on transition relief and retroactivity that should serve as the starting point for all future research in the field. In its stated objectives, the book is admirably ambitious.
This Review will, in a broad sense, follow Shaviro's characterization of the book's objectives. Part I will summarize the existing economic framework for analyzing legal transitions and retroactivity issues (with major emphasis on tax transitions). Although Shaviro makes numerous interesting contributions to this framework, this Review will examine only the two most significant of these. That will be done in Part II. Then, Part III will focus on Shaviro's principal innovation: his introduction of a thoroughgoing public choice perspective and CTB ideology to the tax transitions debate.