The basic form of my question is: What is the best balance between redistributive taxation and allowing people to keep the results of mixing their labour?
I think that a steep slope of taxation, which eventually flatlines at a very high rate, would probably be the best system. This way, even the rich have some financial motivation to continue working, albeit far less than they do in the current American economy. Furthermore, this high rate of taxation for the rich, medium rate for the middle class, low rate for the lower class, and nonexistent rate for the very poor would allow the government to apportion a relatively large amount of money to welfare (or a similar system designed to provide all citizens with at least a decent standard of living). Such a society could also gradually improve the standards of living for those using the welfare-or-something-similar system, as with the advance of technology and society, more resources would become freely available.
I agree with Avery’s idea to have tax increases flatline after a certain point for the rich, after all, they do have the right in our current system to always make more. In addition I think that the nonexistent tax rates for the very poor makes even more sense. If the very poor weren’t taxed at all, then they would need less money for welfare. This smaller amount required could largely be covered by these rather high taxes for the very rich, resulting in an economic ladder for the lower class to perhaps advance half a class or so within a reasonable amount of effort, as well as the very poor. The aim of our currently capitalist economy should not be persistent wealth but rather a sense of stability for even the poorest.
ReplyDeleteI can’t help but feel though, that after certain billionaires surpass the flatline of taxes, that they should have to contribute some of their yearly income to something productive for humanity, at their choosing, agreed upon by a panel of philanthropologists. This extra contribution is not tax deductible, but could cover a variety of gifts, including improvements on a neighborhood they grew up in, mosquito nets for an African village, or even a contribution towards some controversial scientific interest. It should reflect the interest of said billionaire and contribute to their ethical standing in some way, since they have transgressed into the realm of the questionably (un)ethically rich.