TrickleUpEconomicLoungeVille
A link that Greg Fingas provided in his latest progressive round-up over at Accidental Deliberations led me to the actual 2022 World Inequality Report authored by some folks you might have heard of including Thomas Piketty and Emmanuel Saez,
Here is one of the charts demonstrating how big a deal wealth inequality has become, worldwide:
Here is one of the charts demonstrating how big a deal wealth inequality has become, worldwide:
And it turns out that, in addition to the gross unfairness, all this private wealth accumulation, much of it untaxed or, at the very least, under-taxed, is happening as public wealth nosedives:
Of course, when public wealth nosedives we can't affford to pay for stuff that we actually need that has absolutely nothing whatsoever to do with private jets and/or fourth houses in Tuscany.
It also enhances the ability of the usual suspects to get traction when they start screaming austerity which, of course, only makes things worse.
So.
What to do?
Well, what if we were to tax all that accumulated private wealth fairly?
Wouldn't that help everyone out?
Well, it would appear that a growing number of very smart people, including the troublemaking economists cited above, think that would be a good idea.
But it's not just the egg heads, because...
Heckfire!
The great majority of all Canadians of every single political stripe according to a recent Abacus poll (see image at the top of the post) also think it is a very good idea, indeed.
Which begs the question...
Why isn't a wealth tax that everyone wants, and that will make things better for (just about) everyone, a slam dunk?
I would argue that the answer is staring us right in the face in the form of those two graphs from Pinketty and Saez, et al., above.
OK?
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7 comments:
It's hard to disagree with the wealth tax or the need for it as demonstrated in the graphs. But equally important (as I had just read in the latest CCPA Monotone) is an established plan for spending it, and that does not yet exist.
As Roisin West, the newly-named editor of the Monitor wrote in the recent issue, support for additional taxes is not necessarily assured from members of the BIPOC communities and other disadvantaged communities for the simple reason that the additional taxes usually get spent on priorities that matter to those from whom the taxes were taken - militarism, policing and prisons etc. - priorities that place those communities in greater jeopardy than they were before.
Piketty and Saez also have answers for that too, and it's equally important that those be given equal airtime in any discussion of taxation of wealth.
Wow! That’s a heavy read. I also checked out your link to the “troublesome economists”. An even deeper dive into the numbers and who has what and how to share a small bit of it. I have to make it as simple as I can for my little brain but I certainly get the gist of it, and have for some time. When you see the numbers though it does form a sharper picture and shows that, what many of us may call a gut feeling, something is wrong with wealth distribution at national and global levels.
It all isn’t explained, as some like to say, by the fact that some people work harder and therefore have more. If that were the case then women in parts of Africa that raise a family and work and walk miles for water and food and also tend to the many daily chores of existence would be millionaires and the chumps running some corporations or banks with the wave of a hand or a phone call would be struggling to make rent.
I think the reluctance to act on polls by government, such as the one you’ve sited , is because those rich folks have the governments ear. They have contacts, they have influence and they have outsized sway over what may be considered for action by the government of the day.
This contact is both at a personal level and through their companies. The companies and corporations magnify the affect of the owners or management by bringing into the equation the employees, “we’ll be able to hire more or we’ll have to lay off”. They also dangle what they can do for government and for individuals after they leave government.
I find it odd that there are many people, regular, average income people who do not support a wealth tax as I think they see themselves as maybe being one of these very rich people one day.
As one of the best commenters, Ed Deak (died a few years back), on the Tyee used to say, “wealth cannot be created or destroyed only transferred. Transferred from the present to the future or vice versa, transferred from the worker to the company or owner in the form of labour, transferred from the environment to the material world and by having the environment absorb abuse.
The true cost of something cannot be changed. To make it cheaper means to transfer that part of the cost elsewhere. To the workers through less pay, the environment through lax standards, to the future through debt or lax standards.
Ed said it better than I did here but I hope you kinda get his point.
I think that at some point, if things don’t change, the wealth will be redistributed by force. A ways down the road perhaps but an inevitability if we proceed on the present course. When folks have not much to lose they are more likely to risk what little they have.
I hope we are smarter than that as a species and get this whole world on a more equal footing.
zalm--
Excellent points - thanks.
It's great to hear from someone who has really thought hard about this topic already - it's only something I've just started considering seriously.
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Thanks Graham--
I think we are smarter than that and I take real solace from the fact that it appears everyone, perhaps for different reasons, political and/or ideological, sees this as a good idea. In this country, I'm not sure there is anything, except, perhaps, for hockey that we all agree on.
And, like you, I sure do miss having Ed Deak weigh in on things!
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Wealth taxes always sound good in principle. But more challenging in practice. Older readers may recall my attempt to institute a 'mansion tax' (a special property tax on homes over $1 million- which WAS a only a few hundred homes at the time)Sparked a big and intense demonstration and I was promptly shuffled out as Minister of Finance and the tax killed (the tax on expensive cars did, however, survive) Wealth taxes have, more or less, disappeared around the world. The basic criticism seems to be the "valuable assets but cash poor" argument. I am scarred by the sheer number of "progressive" folks who verbally attacked me (and some near violent encounters) because they were retired teachers (or whatever) who had the good fortune of buying in The Western part of the City when it was affordable.
upon reflection, I have come to believe that this type of tax goes against some type of cultural worldview that seems to see these taxes as theft of property by the state. Tax income if you must. Tax consumption for sure. But taxing my assets, some of which I might have to sell to pay the tax, is unfair and amounts to confiscation.
Thought we might hear from you on this one Glen....And, if I remember correctly, one of that government's own caucus members from out on the edge of the pointiest part of town went berserk on that one as well.
If not assets do you think we could broaden the definition of income?
Regardless, if there is anything real (and lasting) to those Abacus poll numbers I would think they might make a lot of pols salivate at the electoral hay that could be made by seriously considering a movement in that direction.
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Yes, I think there is lots of room to tax a broader definition of income. I also like the idea of taxing stock market transactions. A so-called Financial Transactions tax. Given something like 90% of stocks are owned by 5% of people it is highly progressive and even a tiny transaction tax would raise billions. Clearly, any rational person can see that extreme wealth inequality is toxic for a healthy society.
Now that sounds interesting...And such a financial transaction tax might also cut down on AI-driven insta-quant trading that is based on meaningless minute fluctuations in the market.
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