Geolibertarian Tax Policy
Many advocates of tax reform support a 'Fair Tax' that would put into place a federal sales tax to replace the current combination of income, payroll, corporate, capital gains, and other taxes. Republican Congressman John Linder is pushing one with a rate of 23% but with a method of subsidy checks that would function similarly to a Citizen's Dividend, but with a major difference.
The major difference, as I see it, is that the subsidy check would be monthly and based on what the government says is the amount a typical family of your income and size would spend on necessities. So the new system would put into place a very regressive system of taxation with it being up to the government handing out subsidy checks to level the playing field. How much do you trust the government?
Why not look for something better? Tax reform is an issue that Democrats shouldn't be afraid of championing as their own. Right now the 'Fair Tax' camp has acted like it's the only possible tax reform out there. Shouldn't we tell them that they are wrong and offer our own proposals?
Via Kevin Carson I was pointed to a piece by Jeff Darcy concerning Geolibertarian tax policy at Canned Platypus. Geolibertarians as a welcome group within the Freedom Democrats big tent; I'd call myself one! Jeff offers up a true geolibertarian primer by starting with a discussion of the Lockean proviso:
Though the earth and all inferior creatures be common to all men, yet every man has a “property” in his own “person.” This nobody has any right to but himself. The “labour” of his body and the “work” of his hands, we may say, are properly his. Whatsoever, then, he removes out of the state that Nature hath provided and left it in, he hath mixed his labour with it, and joined to it something that is his own, and thereby makes it his property. It being by him removed from the common state Nature placed it in, it hath by this labour something annexed to it that excludes the common right of other men. For this “labour” being the unquestionable property of the labourer, no man but he can have a right to what that is once joined to, at least where there is enough, and as good left in common for others.
I obviously own my own life and my own body, my own labor. The fruits of my labor are also mine. This is the philosophical foundation for property rights. But by what claim do I have to the natural world? Locke says that by mixing it with my labor, I've made it my own property. But he realizes that this is a takings from the common and is justified only if there still 'is enough, and as good left in common for others.' There's a big difference between taking a slice of pizza at a party when there are remaining slices and taking the very last slice of pizza. Jeff states the situation today, with my emphasis added:
The problem, of course, is that there is not an infinite supply of land, and those who were left out of the royal land-grant process end up permanently screwed out of their just share of the wealth which derives from land ownership. Since nobody can live without some access to land, if all the land is already owned then any newcomers’ very survival is contingent on paying whatever rent the current owners choose to charge. This potential for extortion may be exercised to a greater or lesser degree, but is never absent and has played an important (some would say primary) role in creating most of the great historical fortunes. Even those who supposedly built their fortunes some other way are/were dependent and often beholden to previous owners of land-based wealth who invested in their enterprises. The Georgists and geolibertarians, recognizing this for a fact, say that the solution is to charge for the privilege of owning land. Furthermore, they claim, the revenue from such land rents or land value taxes would be sufficient to remove the need for other forms of taxation. Thus, taxes on income earned via labor can be replaced with much more justifiable tax on possession of a static asset to which the right of ownership (especially free and in perpetuity) is morally questionable.
There is also the idea of taxing bads, not goods. You may be familiar with cigarette taxes. Well simply extend that idea and you have another justification for a tax policy that focuses on the use of natural resources.
Thus, extraction of resources - ore, trees, water, oil - from the land should be taxed, as should profligate use of those things and their derivatives (e.g. energy). This theory has been around for a while, mostly (for obvious reasons) coming from ecologists, but a couple of things I’ve read recently have brought it back to my attention. One is Jared Diamond’s Collapse, which describes in excruciating detail how mismanagement of finite resources has often led to the complete collapse of societies and civilizations . . . The lesson that Diamond and the others draw from this is that forestalling a resource-triggered collapse requires some sort of control over the depletion and degradation of natural resources. That control can be authoritarian, market-based, or (most often) some sort of hybrid, but economies and societies that don’t have any kind of control are in an unsustainable state.
And there we have it. You don't have to be a geolibertarian or a georgist to agree with this, I think it can appeal to people of all political backgrounds. We can still be free to disagree about the level of government taxation, what we want the money spent on, and the like. I would like a limited government with low levels of taxation. There is also room for debate on how the tax burden is split among our levels of government. The federal government takes up around two thirds of the tax burden in the USA, with state and local governments making up the remaining third. In addition to lowering of taxes, I'd like to see this shift toward state and local governments making up the bulk of taxes.
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