Substantial changes bring the third edition of this casebook up to date and pick up new strands of scholarly discussion. Many chapters include new excerpts that emphasize political considerations and explore topics such as: The causes and consequences of 30 years of increasing inequality The constraints on policy choices resulting from our unprecedented deficits The psychological and economic factors that have led to our present version of the realization rule The theoretical possibility of adjusting tax burdens to reflect different amenities in different areas of the country Intergenerational (in)equity as reflected in the Social Security tax-and-transfer program How our tax system would function in a world of deflation