Monday, June 30, 2008

Income Redistribution


In general, I think some income redistribution is a good thing, but I applaud the poll results where overall people are more worried about creating good conditions to earn income rather than fighting over some non-existent zero-sum pie.

That said, in age of superstar effects where the best in certain fields will earn much, much more than even closely skilled individuals, is this attitude going to continue?

UPDATE FOR A.J.

First of all there is a link to the poll in question. I should have included that in the original post.

You are right that its impossible to know what each person thinks when they respond to that poll question, but in general, I would read it as this:

Should we focus on making the economy grow, help it to create jobs, and so on and so forth, or should we focus on taxing higher income people more to spend more on transfer payments, social programs etc? (Basically do you want to grow the pie or just change how we cut up the original pie.)

Now it could get tricky with some policies that cut across that line. For example, maybe some form of universal health care would require more re-distributive taxes, but would also help create jobs and growth by de-linking employment with healthcare insurance, allowing greater mobility of labor and more entrepreneurship.

But I am not sure most people are thinking that deeply when answering this question.

Say, I could personally look at the question like this.

Financially, I am having a very, very bad year this year. Should I hope that the government tries to improve the overall economic situation so next year will be better or should I ask the government to take some money from my better off friends with stable salaries to give to me?

3 comments:

Anonymous said...

Sorry Aaron - me again- what the hell does that poll actually mean? Are we talking flat tax/ fair tax? Improve the economy by establishing low universal health care? I could go on but that would just take away from my original question - what does it mean - to you anyway - since you did blog it... Aj

Red A said...

Might also point out that some percentage of people think the government is doing too much as it is (see the poll itself for those numbers) which means you have three options:

a. leave us alone.
b. help out in general
c. tax you to pay me

b & c of course can be blurry.

Red A said...

And I could come up with a list of stuff that would maybe help the US economy in general, but that would be a separate post.