Quote:
Originally Posted by whell
Woah! We're way of course now! However, since you injected the social contract arguement, here goes:
- the social contract concept is not an absolute. It's a theory at best, and is philosophy rather than science. I'd point to Locke as a basis for my responses about a social contract, and I imagine you'd point to someone like Rousseau. Under the law, two sides need to agree to be bound by a contract, and since you and I can't agree on the content of a social contract, I suggest we move on.
- there is an agreement that you and I are party to: the US Constitution. It does give the government the power to levy taxes. The constitution gives the gov't the authority to tax revenue and income. It leaves the determination of rates and wage bases of that tax to congress. So regardless of any social contract, corps and individuals are subject to tax, and regardless of the social contract individuals and groups can petition gov't to modify that tax.
Now to you question, capital and labor are of equal import in an economic discussion. Labor is required to convert capital, but without capital labor can have no product. Taxing capital does nothing but devalue it, reducing its value versus labor.
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OK, thanks for answering my question. My follow up it this: do taxes not also devalue labor? If that is the case, what absolute value is there that should place capital in an advantage over labor with respect to taxation? A different consideration is this: what value do labor and capital receive in return for their taxes? There, we can talk about the infrastructure, the ordered society, the education for the individual and the educated workforce for capital, security, safe shipping, and so on.
And frankly, I did not think I was getting off topic. One of your premises was that we could discuss tax policy without any political discussion as well. I have challenged that premise, and pointed out that the underlying economic analysis here makes certain assumptions with respect to the relative value of capital and labor. I have tried to not frame my responses in partisan political terms, but I am unwilling to concede that the approach to the question can be free of any ideological bent, or that the question was framed without ideological assumptions.
Regards,
D-Ray