WTF?

John, this is an important and timely article.

I am a huge supporter of a Debit Tax.

Oh dear “We live in a society divided into classes.”

Actually we live in a society of individuals, each unique. It seems to me those who twitter on about “class” are the first to forget that

“The exploitative capital accumulation system means that our bosses expropriate the value we workers create and return a small amount to us in the form of wages.”

Ah, this reads like the whining of a malcontent maggot.

“This surplus value is divided up between the capitalist class and the state in the form of profit, rent, interest, dividends, royalties and government revenue.”

Yawn.. I feel a Coma coming on

“Like Dennis Healy, former British Labour Chancellor in the 1970s, I would “squeeze the rich until the pips squeak”.

And like Margaret Thatcher said (that’s the one who cleaned up the Mess left by Healey and the other socialist incompetents) and something our $200 billion dollar debt incurring KRudd & Co government should heed:

“If one generation is expected to carry an excessive burden on behalf of another, it will seek by every means to avoid it. It will either demand that past promises are broken, or it will not work, or it will not pay taxes, or the most talented people will leave. Socialist governments which have tried to tax 'till the pips squeak' have ample experience of that."

Ah enough of the swill…. “Socialist Alternative” Eh?... alternative to what?

The article is just a fetid pile of third rate drivel,

It deserves to be consigned, along with all the other attempts by class-crippled, small minded, envy based mediocrity, who disgorge "socialist philosopthy", which is the hallmark of and emanates from all the feeble minds of the left (by any name “Alternative” or not)

into the cesspool of history (sealed lid style, never to be remembered or considered ever again)

The author has not established how tax is or could be just in the first place.

“If taxation itself is unjust, then it is clear that no allocation of its burdens, however ingenious, can be declared just.”: http://www.lewrockwell.com/rothbard/rothbard149.html

Our society is indeed divided into two classes: the exploited productive class of taxpayers, and the greedy exploiting class of tax-consumers.

The idea that the workers are ripped off by not getting the entire proceeds of production is based on the labour theory of value, which was disproved in the 1890s. If the theory were correct, the value of each Van Gogh would be frozen in time as at the moment the painter stopped his labour by removing his brush from the canvas. No business would ever make a loss, because the value of its product would be the value of all the work that went into it. If you spent $100 million on labour to dig a mine, and found one ounce of gold and then stopped, the value of the gold would be $100 million. But if while walking the dog, you leisurely kicked up an ounce of gold, the value of the gold would be nothing. This clearly incorrect theory underlies all Marxism.

No-one is arguing that you can produce stuff without labour, but to argue that the workers are just as entitled to the full product, as if they had worked without factories, machines and tools, is absurd. Besides, even if they had done so, since socialist theory rejects the existence of property rights, a worker still wouldn’t be entitled to any private property in the product. The theory also regards the direction of labour as entirely unproblematic, as if economic activity consists of endlessly and mindlessly repeating what was done before.

It is always hard to know with socialists whether one is dealing with invincible ignorance or deliberate dishonesty. However anyone attempting to re-run the arguments for socialism must first refute the classic and definitive explosion of them in "Socialism" by Ludwig von Mises: http://mises.org/books/socialism/contents.aspx
; and now the only excuse is intellectual dishonesty.

I had genuinely believed, up until this very moment, that doctrinaire creeds such as this had disappeared, forever, by the end of the seventies.

It seems to have learned absolutely nothing about either the successes, or indeed the failures, of capitalism over the past fifty years.

There is much here that is old, and discredited. And nothing new, or useful.

Right off the bat, we have a pointless, and contentious observation.

"We live in a society divided into classes"

Seriously. Where has this troglodyte been since 1950?

Then we find out that he doesn't mean classes at all, simply the old "capital vs labour" canard.

"...taxation should fall lightly on the labour of workers (if at all) and heavily on capital and the income of capital and their managers."

If you tax capital too heavily, passy, you will gradually eliminate the jobs available for your "workers" to enjoy.

Capital. Creates. Jobs.

Put it another way - how do you believe jobs are created? By some prodigal fairy?

Which part of the history of business in this country since the war years passed you by?

"by imposing taxes on capital we can help begin the revolutionary process that leads to a society free of classes where individual liberty and freedom can at last begin to flourish"

No you can't.

You will help begin the revolutionary process that leads to a society free of jobs.

But it does occur to me, that this is actually a cleverly compiled piece of humour, designed to hit all the buttons that we capitalists react to.

You are just having a clever lend of us, passy, and you sucked me in. Congratulations.

Because, seriously, no-one can possibly believe all this claptrap in 2009.

Can they?

<<No-one is arguing that you can produce stuff without labour, but to argue that the workers are just as entitled to the full product, as if they had worked without factories, machines and tools, is absurd.>>

But who made those tools, machines and factories Peter?
Other workers thats who!
The machines are nothing but useless bits of metal without WORKERS to operate them. The capital you speak of came directly from the exploitation of previous workers and is used by the capitalist overlords to continue the exploitation and enrich themselves and their parasitic mates in the government and management classes.

<<socialist theory rejects the existence of property rights>>
Anarchism (libertarian socialism) doesn't. Personal property is yours and yours alone. It is productive capacity and resources that we believe are owned in common.
An anarchist quote illustrates this nicely. "The watch on your arm belongs to you...The watch factory belongs to the people."

Private ownership of factories, machinery etc is to make one individual a despot, a dictator, king, god even, lording it over his serfs on the factory floor and having power over progression or destitution of all those unable to submit or to find a better master. The relationship of master-servant is alive and well, I daresay thriving(at least from the masters viewpoint), in the capitalist corporate world.

Taxation should be progressive up to 90%+ for incomes over a million or so a year. A million dollars a year is $19,230 a week. Who can justify anyone receiving such largess, let alone trying to convince us it is all "earned". If the average wage is $500 per week then this is 38 times more than the average. How could mr millions possibly work 38 times harder than the guy who cleans dunnies 40 hours a week? Does he have some timewarp machine that allows him to work 1500 hours a week? (what mr dunny cleaner would need to do to earn 1 million a year) Does he work 38 times faster, harder, longer than mr min wage? Is he 38 times smarter, 38 times more educated, 38 times more experienced than dunny cleaner man? Is his job 38 times harder, dirtier, scarier than mr min wages? Or is it just that he makes the rules and decides who gets what so naturally pays himself as much as he can get away with? Then builds any and every excuse why its just.

It is just utter delusion and fraud that this (and much worse) is the current situation.
Not to mention what does someone spend $19,230 a week on? How can they possibly "need" so much money and what do they do with it all? Im sure i could drop 20k for a few weeks in a row but every week for years?? The obscenity of this profligacy and greed while people starve and suffer is what I would like the mad col rouge and you Peter to address and justify for us?

mikk. Good point.
The "Pay peanuts get monkeys" brigade have conveniently ignored the fact hat the highest paid industries tend to boom and then collapse.
"Pay millions, get greedy pigs" should be the lesson learned. Encouraging short term profit grabs at the expense of long term viability has killed most industry in the West and transferred the future wealth generation to Asia.
So yes, we desperately need some wealth re-distribution away from corporations and dead capital towards people, who can work to build up a capability again.
Economics states that for utility to be maximised, profits must be minimal. Competition is the assumed way to minimise profits, however in the real world many industries just don't have any real competition. This is evidenced by record profits in last decade.
To those who say Socialism is dead: Surely the massive bailout of US, European, and Australian capitalist institutions by public money shows that the ultra-capitalist model is also fatally flawed?
Letting the rich get richer has been the age old human economics that has been going on for thousands of years. A progressive society is pretty recent and for a while it put Australia near the top of the world in quality of life. I'd like to return to that.

It is good to read nostalgic stuff like this.
It takes us right back, at least to the 60s and almost to the 50s in Australian political discussion.
At that time it did seem that perhaps socialism and government control of the economy (necessary to achieve what the writer wants) were the inevitable consequence of the more or less free markets failings. And the evidence of the War when government control over even even small parts of society seemed to have contributed to victory. If the government can defeat our enemies, surely sorting out the economy should not be too difficult?
Since then we have seen attempts to manage societies with various grades of socialism: from highly coercive down to moderately coercive, and in many different cultures around the world.
Nowhere has it produced wealth and a happy society.
So how can one still argue rationally for socialist solutions?

mkk
Ho hum, labour theory of value, perhaps if you keep repeating fallacies they will become true eventually? You have not got to square one yet.

Ozandy
"To those who say Socialism is dead: Surely the massive bailout of US, European, and Australian capitalist institutions by public money shows that the ultra-capitalist model is also fatally flawed?"

The fact that governments took money from the people to give to political pet favourites as part of a government scheme for economic management proves that it wasn't 'ultra-capitalist'. It was just another flawed socialist scheme for trying to manage the economy by central planning.

If it was ultra-capitalist there would be no:
government control of the money supply
government credit creation
government creation of banking cartel
artificial boom
consequential depression
bailouts
'too big to fail' doctrine
stimulus packages
... and so on.

You are simply confused as to the meanings of the words you are using.

mikk, you ignore the "risk vs return" basis behind why those that own capital, and those on high incomes get such high returns. Many run the risk of having periods of time when no money is made (or indeed large losses). Higher income in other times is the systems way of rewarding this risk, and also helping to buffer against it. Then you have some earners who are at high risk of litigation and losing all their wealth - your dunny cleaner is much less likely to be sued for a botched job than is a doctor who has a botched job - hence reward is higher for the risk taken (not to mention said doctor can work anything up to 100 hr a week instead of the 40, thereby infringing significantly on their private and family time, so there is a compensation factor for this too).

Lets not forget while we are on the topic of loss, that small business owners (you know, those that provide the most jobs in Aust), rarely make more than their workers. Sure the profits might be higher, but by the time ou take out taxs then reinvest a significant part of income back into capital, there is often not that much left over. Those that make good profits and are arrogant enough not to reinvest in thei business often find themselves without a business pretty quick smart!

And then your said dunny cleaner can also buy shares in the corporates that are ripping him off - way to go to share in the profits, he can be as capitalist as the next person.

Aaaaah, the nostalgia, mikk

>>Taxation should be progressive up to 90%+<<

"Let me tell you how it will be;
There's one for you, nineteen for me.
'Cause I'm the taxman,
Yeah, I'm the taxman.

Should five per cent appear too small,
Be thankful I don't take it all.
'Cause I'm the taxman,
Yeah, I'm the taxman.

if you drive a car, I'll tax the street;
if you try to sit, I'll tax your seat;
if you get too cold, I'll tax the heat;
if you take a walk, I'll tax your feet.

Taxman!

'Cause I'm the taxman,
Yeah, I'm the taxman.

Don't ask me what I want it for,
If you don't want to pay some more.
'Cause I'm the taxman,
Yeah, I'm the taxman.

Now my advice for those who die,
Declare the pennies on your eyes.
'Cause I'm the taxman,
Yeah, I'm the taxman.

And you're working for no one but me."

(Taxman: Lennon/McCartney)

The only problem, as they discovered back in the sixties, is that you will drive your taxpayers overseas.

Not just the individuals, but companies too.

Nor is it a really great idea to remove aspiration from the mix of motivations that get us to work every day.

It's tough enough as it is.