Reducing inequality

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Doug
Reducing inequality

Here's the start of a nice little series of blog posts on economic inequality and what to do about it. Certainly none of the possible solutions is anything you won't have thought of before, but the data presented are interesting and help show which things work better than others.

 

http://lanekenworthy.net/2009/04/13/reducing-inequality-whats-the-problem/

josh

High marginal income tax rates.  That will do two things:  redistribute wealth and help prevent the boom and bust economy by reducing the amount of money that can be used for speculation.  And, in Canada's case, the implementation of an inheritance tax. 

Daedalus Daedalus's picture

It's not all just about income either. The inequality of low-income Canadians is a vast issue - funding spent on different types of transportation (eg highways etc vs public transit, pedestrian and bicycle transit), discrimination and prejudice, distribution of municipal services, all sorts of things. I'm a low-income Canadian and I often feel completely invisible when I watch the news, even the CBC, so often it seems we are invisible in many discussions, and when we are talked about it's like we are some remote, far-away population and rarely are we ever invited to speak even when the discussion is about issues related to us. Income is definately hugely important too but I think it's a much bigger issue.

Jacob Richter

These solutions have to be a global and not national take on the first six measures of the Communist Manifesto (in order), which go beyond shallow social-democratism:

1) Abolish private ownership of rural and especially urban land, but make sure that ground rent is still collected for the public purse (which the Soviets didn't do to the detriment of their land planning).  For more on this Ricardian economic measure, read Henry George's Progress and Poverty.

2) "Direct voting of taxes" (1891 SPD program) which allows conscious folks themselves to establish "wartime" upper tax rates (such as on multi-million-dollar incomes), higher alternative minimum tax rates, and even transfer pricing rates (for corporations earning more profits from low-tax jurisdictions by means of transfer pricing).

3) Measures against inheritance "rights" - although, as implied above, some form of direct voting should be applied here, as well.  I read a blog about heavily taxing the wealthy dead like Elvis and even, to my surprise, Einstein (wasn't rich in life, but his estate is quite wealthy now).

4) Something has to be done about capital flight, and "Tobin taxes" aren't enough.

5) The post-Keynesian Hyman Minsky, like Keynes and his "somewhat comprehensive socialization of investment," suggested a fully state-owned financial system (on the international level, the IMF and World Bank are collective efforts by state governments).  Professor Willem Buiter, himself no means a Marxist, agreed recently.

6) Daedalus above already mentioned that "the inequality of low-income Canadians is a vast issue - funding spent on different types of transportation (eg highways etc vs public transit, pedestrian and bicycle transit) [...]"