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Don’t Tax Me, Bro (2)

September 30, 2016

Bill Gates, still World’s Richest Man (and fellow Seattleite), favorably reviewed Thomas Piketty’s Capital in the Twenty-first Century (2014). It’s a clear and helpful review, with a link to a good summary of the book.

Gates wrote that he agreed with Piketty to a large extent, but not P’s proposal to raise taxes on the wealthy (i.e. via “a progressive annual tax on capital, not just on income” * ).   I take it that this is a way of saying that the tax rate for Gates should not be increased; and I’m going to infer, although I might be “reading in,” from this and his emphasis on a consumption tax plus philanthropy to help solve the problems of runaway wealth of an American aristocracy, that his reason is that Gates, himself, knows how to spend his money best. I take this to be a common (wrong-minded and loathsome—to make my bias clear) argument made by libertarians such as the Koch Bros (NLC).

Granting for the sake of my argument that that is an important part of the Gates position on taxation, I can think out loud about a couple of problems that I see with that position (even if it is unfair to pin it on Gates).

In the context of page 1 of this episode, why should I think—why should he think—that, as a blanket proposition, any individual knows better about how to spend his (or, very rarely, her) big money, than does a democratically elected government? Especially his surplus dollars. Especially when he has an enormous share of the available dollars and a lot of people, within that tax jurisdiction do not have enough dollars to finance a basic, healthy way of living.

Furthermore, to be living in a democracy and suggest that because of your wealth and your intelligent consumption, including your philanthropy, you should not be equally subject to the wisdom and the errors of the representatives of the people is to place yourself outside of that democracy, even if you are enjoying its benefits.

In a robber society, a monarchy, a totalitarian dictatorship, we are taxed by the boss to pay for his life style. In a democracy, we tax ourselves, as a community, in order to pay for necessities and improvements of our life style; in a progressive democracy we tax for two reasons: to meet our needs, and to hold the power of the few in check.

In order to tell me that it is morally acceptable to be the top one 1% of life styles in a world with such a wealth gap, you have to tell me that you have stepped outside the thought of every best thinker on morality in world history, and that you have delineated a new moral system in which that’s okay. And why would you do that? Why justify the triumph of an individual, measured by accumulation of wealth, at the expense of misery on the part of billions of other humans?

I’m still worried about this Gates/libertarian position, so there’s likely to be a page 3, as something crystallizes.

* But Gates is progressive (to the best of my understanding of these things) when he recommends a shift away from taxation of labor, in favor of “a progressive tax on consumption”—which, I think, could take a form like the VAT tax (?). Gates also favors the estate tax, plus philanthropy, to help counter the wealth gap and the problem of a hereditary aristocracy.

[Earlier page, “Don’t Tax Me, Bro!”  “Page 3”  became “Taxation (1):  Gates Upon Picketty”]

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  1. Don’t Tax Me, Bro! | tomkoontz

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