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Friday, April 8, 2011

Conflict to compromise to synthesis: Tax Policy

In the coming days I want to make some proposals about bridging the gap between the two ideologies of progressivism and libertarianism. Of course we already have much in common and i don't want to go over those agreements here. Instead what I would like to focus on are the issues where we don't seem to find common ground. Mostly this will be about economic policy but from time to time we might explore some cultural, defense and foreign policy issues.
Today, I want to offer up an idea on tax policy and solicit your responses. I do this not to be argumentative but to develop ideas which will strengthen an emerging coalition which Ron Paul has already begun.
Ls think we Ps love taxes, as if we derive some kind of masochistic pleasure from filing our taxes. The truth is we long for simpification as much as you do. And believe it or not we would rather our taxes be lower. Of course, we do differ in other respects. Ls tend to prefer flat consumption taxes while Ps tend to prefer progressive income taxes. What if Ps could let go of their desire to tax income and Ls their desire not to tax bigger somes of money at higher rates. The result is a progressive consumption tax, a tax advocated by liberal economist, Robert Frank and approved by conservative economists:  http://www.economist.com/blogs/democracyinamerica/2010/11/inequality_and_executive_pay


  1. This could actually be a good idea, but if it simply replaces the personal income tax, then I don't see this as providing much value. Libertarians, on principle, oppose all forms of taxation, but we do not argue that taxation is unconstitutional. That being said, if this progressive VAT is lower than the current income tax brackets, then I'm sure we'd support it over the current system.

  2. I'm liberty leaning but agrees some form of taxation is to be implemented to fund a citizen controlled government.

    I'm left libertarian as I would to see Basic income guarantee given to all citizens like they have in Alaska.

    But scrap most of government and bring troops home.

    Scheme can be funded with some creativity VAT/Income

  3. Found the link to your blog via my fellow RP Forumites. *waves to freshjiva*

    As a Free Market Anarchist, my default position is to completely and totally scrap taxation since I want to completely and totally scrap The State. However, having said that, there has to be a staging down from the nightmare we find ourselves in now (before systemic collapse sets in). I think having a modest tariff policy isn't bad and certain consumption taxes which we pay now anyway, whether directly via Sales Tax or indirectly through the built-in taxation of an item (income tax of the worker who produced it, income tax of the company that designed it etc).

  4. This bit will lose any libertarian support: "report not only their income but also their annual savings"

  5. freshjiva, I realize what I am advocating here is not the libertarian ideal but it is a deal that, if completed, would simultaneously move us closer to both the libertarian and the progressive agendas. Economic policy is the main barrier in forming a coalition. If we can come up with some creative compromises, we stand a chance of getting more progressives on board. I think we can agree that Ron Paul is the best hope right now for both the Ls and the Ps. I want him elected because the corporate duopoly has proven time and time again to be against both perspectives.
    Mordan, Sounds great to me.
    Brooklyn, I like your realism. My thought is a progressive consumption tax done the right way will generate more revenue and decrease the tax burden on most Americans. And if the rich decide to invest more and spend less, the same goes for them as well.
    Jonathon, Are we not having to do this already? Maybe reporting income and savings is against a purist libertarian agenda but all or nothing usually gets one nothing. I would argue a progressive consumption tax gives more liberty than the current income tax because you get to fire your accountant and use the savings as you please.