Source of the information is sufficiently credible to be referred to as being rock solid.
I don't think we've ever heard that one before!
So you don't have a source for these numbers. That's cool, we'll just ignore them.
Property taxes in the US don't go to the federal government - they go to municipal government. The lion's share of this income is used by town halls to finance local public education. This means that the rich, living in wealthy neighbourhoods, can finance excellent educations for their children while those in poor areas get third rate educations... preventing social mobility.
In France, local taxes are used to finance infrastructure and services which aren't deemed essential for preserving a social model which (for the time being) still benchmarks itself on the "equality of chances" criteria. These services include libraries, swimming pools, local roads, etc. while education is financed from the state budget.
However, the French system is powerfully redistributive, through the system of perequation : the central government imposes redistribution of the property tax take, in order that levels of public services stay roughly equal everywhere.
Compare this to the USA, where equality of opportunity remains a nice idea. It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
If I recall my property tax in California correctly, it was about 0.6%/yr of the sale value as long as you own the property. The Scarsdale NY tax is about 2.5% of valuation, it would appear. That should finance a pretty splendid set of local services. As the Dutch said while fighting the Spanish: "It is not necessary to have hope in order to persevere."
But aren't there any attempts at tax increases, particularly on taxes that would fall more heavily on wealthier individuals? (Arguably, state salary cuts are such a tax,
State employees in Europe are usually under-remunerated relative to their qualifications (depending a bit on which proxies you use to estimate qualification). The implicit understanding is that they have greater job security and more secure salary progression than in the private sector.
If that understanding is broken on the employer side... well, that won't necessarily be cheap.
- Jake If you only spend 20 minutes of the rest of your life on economics, go spend them here.
But the real argument that cutting state employee wages is really a tax on the rich, broadly speaking, is that government employees tend to be higher skilled just due to the kinds of work that governments need done, compared to the private sector at large, which has a lot more use for lower skill employees. Taxing higher skill people, if there are a lot of them, is an effective way of redistributing income.
Does an average budget analyst, say, get paid lower in a government job compared to at a private employer?
Can not speak for all of Europe, but that would be the case in Sweden, yes. Job security - in particular in recessions - is considered worth a lower wage.
santiago:
But the real argument that cutting state employee wages is really a tax on the rich, broadly speaking, is that government employees tend to be higher skilled just due to the kinds of work that governments need done, compared to the private sector at large, which has a lot more use for lower skill employees.
The Swedish government employs anything from janitors to professors. Do we have some data to back up there being a difference? A vote for PES is a vote for EPP! A vote for EPP is a vote for PES! Support the coalition, vote EPP-PES in 2009!
Job security - in particular in recessions - is considered worth a lower wage.
Another point is that in the public sector you could usually expect to be protected from all the moronic MBA "management" fads that periodically sweep through the private sector when there's an excess of failed businessmen who form "consultancies." This is, at least in the high-end jobs, worth a considerable gap in remuneration.
That's changing with the infection of New Public Management, and the long-term consequences of this in terms of wage demands from mobile high-skill professionals is yet to be seen, but I suspect that it won't be pretty. (And of course, the New Public Management infection brings along the professional culture of private sector mid- and high-level managers, along with the graft, corruption and outrageous paychecks, bonuses and golden parachutes that we've come to know and love...)
Broadly speaking, yes, though it depends on what sort of metrics you use - the base salary is on the same level or slightly higher, but the bonuses are more generous, and private sector employees normally expect to be paid for overtime.
And this is based on the same sort of fallacious post-hoc analysis that says that industrial policy redistributes from poor to middle class.
If you have a society where the people in low-skill dead-end jobs outnumber the people in high-end, high-skill jobs, then protecting industries and civil service functions is a redistribution from poor to rich. If, on the other hand, you start out with a society in which everybody, or near enough as makes no matter, works in a protected sector, then removing those protections is a redistribution from poor to rich, since the wealthy can buy their own protection and the displaced workers cannot.
Clearly, of the two outcomes, the one in which everybody works in a protected job is superior in terms of income distribution, income security and general welfare (except for the wealthy, who have to foot the full bill for these protective measures). So eliminating protections, whether from an explicit industrial policy or from a superior public sector may look as though it transfers money from rich to poor, but when embraced as a structural policy it does precisely the opposite.
No, it's just a simple fact of life if people are renumerated in any way correlating to the level of their skills or education, regardless of how well everyone in society is protected. Taxing higher skill people is usually the best way to raise revenue equitably, unless income is already very equally distributed. Is that the really the case in Spain, though?
It's akin to claiming that allowing scabs to steal the work of strikers is distributionally progressive: The scabs are, ceteris paribus, worse off than the unionised workers, therefore converting a union shop into a scab shop redistributes from rich to poor. I should hope that it is unnecessary to elaborate on why this is utter horseshit.
Any policy that redistributes from the middle class to both the wealthy and the poor is regressive - if you generalize it to the whole of society, you achieve a society where the middle class has become poor, the poor have become slightly less poor, and the wealthy make out like bandits.
It matters really what the data says about the true distribution and upon whom the burden is really falling and the benefits accruing. (A Gini curve can still get flatter by taking from the upper part of the middle, depending on the original shape of the curve, for example.) Spain has notoriously high unemployment, which means that it is entirely possible that transferring wealth from employed upper-middle class government workers to unemployed people is still progressive, even if the rich (high skilled non-government workers and owners) aren't asked to help in that transfer. It all depends on the numbers and levels of rich, upper middle, lower middle, and unemployed are.
Put simply, you don't create a reasonable middle class income for the poor by impoverishing the middle classes - you do it by taxing and regulating the rich, because they own the bulk of the wealth.
While I'm sure some rich conservatives enjoy the divide-and-rule prospect of trying to set the poor, the unemployed and the middle classes fighting each other for scraps like crabs in a bucket, the point of progressive policy is to ensure that social investment is substantial and significant.
Scraps from the table aren't an acceptable substitute for that.
http://dialnet.unirioja.es/servlet/fichero_articulo?codigo=3136587&orden=0
suggests that Spain's top 1% have a similar order of the national wealth (20%) to those in Anglo countries.
Better general ways would be:
(a) location benefit levy - a tax on land rental values which is essentially a tax on the privileged use of the land commons;
(b) a levy on gross revenues from intellectual property rights - ie a tax on privileged use of the 'creative commons' of knowledge;
(c) a limited liability levy on gross corporate revenues - limited liability is another untaxed privilege;
(d) levies on use of non-renewables - another commons - and so on.
Then I would get rid of all other taxes except levies on earned income aimed at funding education and healthcare.
There is no chance of doing this via the State, since it the privileged turkeys who manage and own the country would not enact Christmas.
But I think in the emerging networked society and economy such an architecture could well evolve. "Any economic unit can emit money. The serious problem is to get it accepted" Hyman Minsky
Spain has notoriously high unemployment, which means that it is entirely possible that transferring wealth from employed upper-middle class government workers to unemployed people is still progressive, even if the rich (high skilled non-government workers and owners) aren't asked to help in that transfer.
You are postulating that it can help the poor and lower middle class for the poor and lower middle class to gang up with the wealthy and soak the upper middle class, as opposed to the poor and middle class ganging up to soak the rich (and yes, the two are mutually exclusive - coalitions don't form and disband overnight).
I'd like to see a historical example or two of the former ever actually working to improve income and income security for the poor.
So splitting hairs over income taxes is, indeed, regressive. Income is not where the real inequality in economic power lies. By laying out pros and cons we risk inducing people to join the debate, and losing control of a process that only we fully understand. - Alan Greenspan
Actually, most of European politics can be summarized as a political arrangement between the owner class and the working class and poor to tax the upper middle class bourgeoisie in order to fund large welfare states. (See Jonas Pontusson, Equality and Prosperity: Social Europe vs. Liberal America)
Duplicate comment deleted. By laying out pros and cons we risk inducing people to join the debate, and losing control of a process that only we fully understand. - Alan Greenspan
