flâneur

Could we permanently fund the government via a one-time wealth tax?

matthewbarnett.substack.com · 2,241 words · saved by 1 readers

Here’s a proposal: write a constitutional amendment abolishing taxation after we do it just one more time. Once, and only once, the government will be allowed to take some fraction of the wealth stock, and then never again. Importantly, the government retains all of its other powers — the power to enforce laws, provide for the national defense, pay welfare, and adjudicate disputes between people — but it must fund those activities using the capital income from the wealth it now owns. Why would we want to adopt such a proposal? There are two main reasons. The first reason is that it will effectively permanently eliminate the lost economic efficiency from taxation. The second reason is that, by giving the government a relatively fixed share of wealth, it will now be encouraged to be fiscally responsible, rather than shortsightedly take out debt that it will not be able to pay back without constantly raising taxes. I’ll elaborate on my two justifications in turn, and then address a few ob

Here’s a proposal: write a constitutional amendment abolishing taxation after we do it just one more time. Once, and only once, the government will be allowed to take some fraction of the wealth stock, and then never again. Importantly, the government retains all of its other powers — the power to enforce laws, provide for the national defense, pay welfare, and adjudicate disputes between people — but it must fund those activities using the capital income from the wealth it now owns. Why would we want to adopt such a proposal? There are two main reasons. The first reason is that it will…

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