The Concise Encyclopedia of Economics

Walter Wolfgang Heller

Walter Heller's claim to fame stems from his years as chairman of the Council of Economic Advisers (CEA) from 1961 to 1964, under presidents John F. Kennedy and Lyndon B. Johnson. Before that, and after, he was an economics professor at the University of Minnesota.

As chairman of the CEA, Heller persuaded President Kennedy to cut marginal tax rates. This cut in tax rates, which was passed after Kennedy's death, helped cause a boom in the U.S. economy. Heller's CEA also developed the first "voluntary" (that is, enforced by veiled threats rather than by explicit laws) wage-price guidelines.

Heller's early academic work was on state and local taxation. In 1947 and 1948 he was tax adviser to the U.S. Military Government in Germany. He was involved in the currency and tax reforms that helped spur the German economic boom (see German Economic "Miracle"). In a 1950 article, Heller noted that the reduction in marginal tax rates helped "remove the repressive effect of extremely high rates."

According to tax economist Joseph Pechman, Heller was also one of the first economists to recognize that tax deductions and tax preferences narrowed the income tax base, thus requiring, for a given amount of revenue, higher marginal tax rates.

Selected Works

Monetary vs. Fiscal Policy (a dialogue with Milton Friedman). 1969.

New Dimensions of Political Economy. 1966.

"Tax and Monetary Reform in Occupied Germany." National Tax Journal 2, no. 3 (1949): 215-31.

"What's Right with Economics?" American Economic Review 65, no. 1 March (1975): 1-26.

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