An interesting discussion by AG here; Mankiw's crack at it here ; and a couple of good ideas by Daniel Lakeland here and here. The basic idea is a pimped-out version of the negative tax policy advocated by Milton Friedman in the 1960s & 1970s, which was in turn adopted by Barack Obama in 2008, only to earn him jeers for being a socialist. I guess Milton Friedman was a socialist, too.
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