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If you're from a disadvantaged background, but put as much effort as a person from an advantaged background, then you would make the same after-tax income.

I think this misrepresents the notion behind progressive taxation. I'm no expert, but I understand it like this: because of declining marginal utility, the same % of income may mean much more to the poor than to the rich. If my yearly income is 10k, then 10% of it might mean the difference between making rent or not. If I make 100k, 10% of it may mean forgoing some luxury, but needn't substantively impact my overall quality of life.

In that sense, the subjective impact of money is not fixed by its objective value; it's more important to those that have less of it. This is borne out by research. Money significantly impacts happiness until you make enough to basically get into the (lower) middle class, and then it has little impact.

So, if you buy the above intuition and want to use taxation to help maximize happiness (utilitarianism), then you would want some form of progressive taxation in order to alleviate the negative impact of poverty. This doesn't mean "making everyone equal."

To test our intuitions about this subject, I like philosopher John Rawls' conception of a "Veil of Ignorance." Rawls would ask: would you rather live in a society with, say, 1% billionaires and everyone else in poverty, or one more evenly distributed around a middle class -- without knowing in advance where you would end up in this society? The answer may well depend on one's level of risk tolerance, but I'd wager that most people wold opt for the latter.




> I like philosopher John Rawls' conception of a "Veil of Ignorance." Rawls would ask: would you rather live in a society with, say, 1% billionaires and everyone else in poverty, or one more evenly distributed around a middle class -- without knowing in advance where you would end up in this society? The answer may well depend on one's level of risk tolerance, but I'd wager that most people wold opt for the latter.

Except that that's not the choice that we're faced with.

Instead, we're faced with "lots of billionaires, a huge middle class, and poor people with 2 cars and 4 TVs" vs "nasty, brutish, and short". Oh, and the former gets better over time much faster than the latter. If you're really going to be serious about the ignorance thing, you should be ignorant of when you live.


If my yearly income is 10k, then 10% of it might mean the difference between making rent or not. If I make 100k, 10% of it may mean forgoing some luxury, but needn't substantively impact my overall quality of life.

If I make $100K it's entirely possible that my rent or mortgage is ten times that of a person making $10K, as well as my other costs of living.

If you doubt the veracity of that comparison, take a look back at property prices in the few years prior to 2008 and do the mortgage calculation yourself. It is not at all uncommon to find $5,000 p/month mortgages, and I know you can find rooms to rent for no more than $500 p/month.

So, if you buy the above intuition and want to use taxation to help maximize happiness...

What does happiness have to do with it? No-one in this country is guaranteed happiness. It's not the government's responsibility or right to make people happy, or even to try. Their charter ends at making sure people have the right to pursue happiness, that is all.


> I think this misrepresents the notion behind progressive taxation.

The article isn't about progressive taxation. It's about utilitarian taxation.


it is impossible to come up with a model that isn't arbitrary at some step. the lower middle class of today literally live like kings compared to a few hundred years ago, and in a another hundred years the "lower middle class" might very well live like multi-millionaires today.

central planners can not be objective under any circumstances unless it is literally a god AI with perfect knowledge of determinism.


That's why we have a democracy, where these "arbitrary" lines are ultimately drawn by votes, not central planning committees. Nobody is arguing for Soviet style totalitarianism.


Assuming you mean in the USA, we don't have a democracy it's a republic, which means we definitely do have central planning committees, but they are appointed by politicians who are voted into office by the people. It's not quite "Soviet totalitarianism", but it's several steps removed from voters.


democracy is schizophrenic. if you're saying that voting reflects the preferences of the people we already have a system for that, it's called the market. so under democratic central planning you have people signaling one preference with their dollars and a different preference with their vote. except the majority of people aren't deciding what to do with their own money when they vote, they're deciding what to do with other people's money. producers are a minority.




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