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Wealth and Want | |||||||
... because democracy alone is not enough to produce widely shared prosperity. | |||||||
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Defense Nic Tideman: Global Economic Justice, followed by Creating Global Economic Justice WOULD THERE be enough revenue for the public sector? To address this question, one should consider different types of public activities separately. The type of public activity that can most readily be financed by charges for exclusive access to natural opportunities is local public services. When these are desired by voters and provided efficiently, they tend to raise the rental value of land by enough to pay for themselves, since a local public service provides a benefit in a limited region, and people will bid up the rental value of that land by the value of access to the service.2 Thus local services can be financed without even beginning to draw on the value of opportunities provided by nature. Another broad area of public spending is national defense. While defense increases the value of land in a dangerous world, one might reasonably hope that the need for defense spending would be greatly reduced in a world that had adopted a general norm of acknowledging the equal rights of all persons to natural opportunities. To the extent that defense costs are raised when a nation becomes a more attractive target-- because of increases in its stock of capital or in the productivity of its citizens--it would be efficient and not unreasonable to have an annual charge on capital and on talent (an asset protection fee) to defray these costs. Such a fee could be collected by a self-assessed tax. For capital, the tax could be enforced by an obligation to sell the capital at the self-assessed price. For talent, the tax could be enforced by a rule that if a person was injured in an accident and wished to sue for loss of earning power, the self-assessed value of the person's talent would be the upper limit on the damages that could be claimed. It is likely that a tax rate of two or three tenths of one percent per year would suffice to fund the current level of U.S. defense spending. But I would hope and expect that defense spending would fall substantially. Between the reduced need for defense spending and an efficient asset protection fee for the extra defense costs generated by increases in capital and talent, it should be possible to finance defense without exhausting the rental value of exclusive access to natural opportunities.
Nic Tideman: The Shape of a World Inspired by Henry George How would the world look if its political institutions were shaped by the conception of social justice advanced by Henry George?
Nic Tideman: Improving Efficiency and Preventing Exploitation in Taxing and Spending Decisions
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