(urth) Gene Wolfe Fans Talk Politics (Again)

[Adam Thornton]

On May 19, 2009, at 3:47 PM, James Wynn wrote:

> If you really believe that a "full-on social-services safety-net  
> state" is important you should be happy to fund it to the same  
> degree as your fellow citizens and laborers. I agree that such a  
> system could not be compared to "robbing from the rich to give to  
> the poor."

Of course, "fund it to the same degree," and "robbing from the rich to  
give to the poor," each themselves admit multiple interpretations.

One way of "funding it to the same degree" would be to demand a flat  
amount from each citizen.

This strikes most people as impractical, as, if each contribution were  
limited to that which could be squeezed from the poorest citizen,  
there would be effectively no revenue to pay for the service.

One way would be to impose the same percentage fee on each citizen,  
regardless of income.  This is usually what Libertarians claim to  
like.  However, such a plan ignores the (I think fairly important)  
observation that the marginal value of money decreases the more of it  
you have.

By that I simply mean--and I suspect that I am not alone on this list-- 
that I've lived on $15,000, $30,000, and $60,000 a year.  One would  
expect from the flat-percentage argument that the difference in  
lifestyle comfort between $30,000 and $60,000 would have been double  
the difference between $15,000 and $30,000.  This is, in my  
experience, manifestly not so--indeed, quite the opposite.  The  
difference between $30,000 and $60,000 was very minor compared to the  
difference between $15,000 and $30,000.  That implies that the  
marginal value to me of each dollar between $15,000 and $30,000 was  
more than double the marginal value of each dollar between $30,000 and  
$60,000.

( By way of example: at $15K, I shared a run-down house with several  
other people, ate ramen and similarly-priced but unexciting  
food--"eating out" meant fast food or very, very cheap restaurants,  
and even so, was done very sparingly--and very rarely bought books,  
and almost never new books.  At $30K, I and my partner had a rented  
house of our own, ate meat when we felt like it and occasionally ate  
out at restaurants with metal cutlery, and went to a new-book  
bookstore a couple times a month.  At $60K, we owned (for values of  
ownership meaning "had a mortgage on") a house similar to the one we  
had rented, ate meat when we felt like it and could go eat at nicer  
restaurants if and when we wanted, and went to the bookstore a little  
bit more often. )

Hence a third way would be to impose a tax that causes the same amount  
of inconvenience at all levels of income.  This is approximately what  
progressive income taxes attempt to do.  I would argue that current US  
taxation levels are somewhere between the second and third models.

"Robbing from the rich to give to the poor," is simply the same  
argument stood on its head, of course.  Does taxation go from  
"legitimate" to "robbery" at a value derived from the absolute dollar  
value of the tax, from a percentage of income across all income  
ranges, or to a degree of inconvenience across all income ranges?

Adam