In the Wall Street Journal‘s Notable & Quotable:
Friedrich A. Hayek in “The Constitution of Liberty” (1960), on the myth that progressive tax rates are necessary to fund large increases in government spending, lest an intolerable burden be placed on the poor:
Not only is the revenue derived from the high rates levied on large incomes, particularly in the highest brackets, so small compared with the total revenue as to make hardly any difference to the burden borne by the rest; but for a long time . . . it was not the poorest who benefited from it but entirely the better-off working class and the lower strata of the middle class who provided the largest number of voters.
It would probably be true, on the other hand, to say that the illusion that by means of progressive taxation the burden can be shifted substantially onto the shoulders of the wealthy has been the chief reason why taxation has increased as fast as it has done and that, under the influence of this illusion, the masses have come to accept a much heavier load than they would have done otherwise. The only major result of the policy has been the severe limitation of the incomes that could be earned by the most successful and thereby gratification of the envy of the less-well-off.
{ 5 comments }
why not reverse progressive taxation of all stripes? little if any tax on the highest incomes, tax to almost confiscatory proportions the lowest and middle incomes. anyone with any ambition would cloud the market with production of mythical proportions. this is a lot like my “quick as hell employment theory”, get em off welfare and the’ll get to work quick as hell.
e.g. A liberal professional intellectual making 50,000 who derives tremendous satisfaction for the looting of his corporate compatriot making 200,000.
Next year will be the 50th anniversary of the publication of The Constitution of Liberty.
Anyone have any events planned?
Another thing to note, since there is always inflation, today’s tax on the rich is tomorrows tax on the poor and the middle class.
David C has got it.
At the rate the presses are running how long before the average wage is over the 250k boundary?
Hardly takes adding one zero…
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