patrick.net

It may be cruel, merciless, and "unfair" but calling it failed is a case of bad word choice IMO.

Information technology (not telecommunication) is one of the least regulated industries yet in the last 20 years we have been seeing a lot of

1. large, established companies being unseated
2. small, garage-type start-ups becoming giants (e.g. Google)

On the other hand, telecommunication is heavily regulated. See what LARGE corporations are still running the show!

Have faith in Nature. Things take care of themselves.

but communism generally results in corruption and dispair and a collapse in the economy

That is a myth. Corruption ensured in communism mostly because of the big government it required to manage and regulate.

Remember, corruption is a symptom of over-regulation. Or more accurately, it is a product of:

1. under-paid government officials
2. over-powerful public employees
3. lack of public oversight

You don’t consider the aristocracy having their heads cut off in guillotines to be a failure?

No. Human history is full of disturbances. The French Revolution or 1917 are just some examples. We always revert to our natural tendencies.

We could fix this country by turning the clock back to 1946 but unfortunately that’s not going to happen.

We could fix this country by turning the clock back to 1912 but unfortunately that’s not going to happen.

Free markets don’t respond to moral arguments. You are now arguing FOR regulation.

I was simply illustrating the moral paradox in case someone makes a moral argument. ;-)

I believe in 100% economic freedom for everybody and a strongly regressive system of taxation (e.g. poll tax) that encourages production.

America is now THE superpower after Ronald Reagan destroyed the Evil Empire. Enough said.

It was not a superpower in 1912 because there was no such thing.

Albert Einstein enabled the existence of superpowers.

Great Depression was an adjustment, not an end. The Panic of 1837 was arguably worse, but Andrew Jackson adhered to the laissez faire principles and the country emerged from the depression in a few short years.

Andrew Jackson allowed things to go their own ways and things improved by themselves.

FDR wanted his way forever if he could. But thank God.

I think the real point of debate here is taxation. Some tax is necessary, but any tax necessarily takes away some freedom.

Peter P says

I believe in 100% economic freedom for everybody and a strongly regressive system of taxation (e.g. poll tax) that encourages production.

A poll tax prevents the poorest from keeping the fruit of their own labor, discouraging them the most.

A land-value tax would allow everyone to keep what they make. No one created land. All productive labor would be tax-free.

A land-value tax would have prevented both the Russian and French revolutions, IMHO.

Land-value tax is an interesting concept. It is indeed much more fair than progressive taxation (which is progressive only for wage-earners anyway). I do not oppose this idea.

Patrick may want to have a new thread about land-tax again.

Poll tax discourages the poor only if it is unaffordable. So long as it is practical to earn disposable income above and beyond the fixed amount of taxation, everyone should be adequately incentivized.

It is noteworthy that under ANY system of taxation the poorest will not have disposable income (beyond necessities of living) at all. On the other hand, under any system the equilibrium labor _price_ will allow the even the poorest productive workers to live productively.

It is hard to fathom a fixed or regressive system of taxation with the current level of public spending. But that spending can be replaced with a user-fee system. I think many middle class families would not object to paying $10K per child per year for education if they pay 4% instead of 40% of their income in tax.

Example of a user-fee road system:

* Every vehicle contains a tracking device or GPS receiver/transmitter.
* If the vehicle stops, it gets charged for parking
* If the vehicle moves, it gets charged for using the roads

The fee schedule is determined based on supply and demand. Each segment of roadway can charge different prices based on weekly electronic auction results. Motorists can buy blocks of units for present and/or future use.

This system will be superior to gasoline tax because it also ensures that resource allocation is optimized. For example, more heavily utilized highways will become more expensive, incentivizing motorists to use less congested routes.

I am not making a value judgment here but this system will _naturally_ lead to better public transportation infrastructure (which can finally compete with automobiles). And it will be more "green". :-)

BTW, I heard that Hong Kong has a land-value tax, and because of this, they can have very low income taxes and high prosperity. But I also heard that it's a very political issue there, with the Hong Kong gov't preventing public land from development because that would increase the land supply and lower tax revenue in the short run.

Re highways, it already is more "expensive" to use the congested ones, if you count your time as a cost. Yet people often do not make the rational decision to use cheaper and more timely public transit (like Caltrain) because they prefer their iron bubble, where they do not have to interact with fellow citizens.

In many countries, most land cannot be owned. Rather, parcels of land are leased for 99 (or more) years. When the lease is up, the user may have to return the land or pay some fee.

So I guess it is a form of land tax in some ways.

I heard Hong Kong is having another housing bubble right now.

http://www.ft.com/cms/s/0/2f1ddc6a-b941-11de-98ee-00144feab49a.html

Close to $10K per square foot??? Come on, it is not Monte Carlo. ;-)

I believe Hong Kong is very conscious about having a small government in relation to the size of the market.

It has an interesting property tax system though:

http://en.wikipedia.org/wiki/Property_tax#Hong_Kong

I take Caltrain and I do not have to "interact" with fellow rage-filled road users. ;-)

We have to take our car to the train station though. Buses are so unreliable.

People should really pay the real price of driving.

I read the wikipedia entry on the Hong Kong property tax and don't get it exactly. Sounds like it's just a tax on rents, which I guess is similar, but not the same.

A tax on rents is limited by the rent people pay, and would not stop a bubble.

A tax on land values is not limited by rents, and would stop a bubble through high taxes.

Very interesting...

It seems prosperity follows when the majority of the population aspire to prosperity as opposed to economic equalization.

When prosperity does arrive, all "justifications" for economic equalization become null and void.

I guess Adam Smith was right:

“The real tragedy of the poor is the poverty of their aspirations”

Patrick, I don't know... but whatever it is, they cannot stop the housing bubble in Hong Kong.

But of course all "good" bubbles must come to an end.

Tell me the horrors of FDR’s world?

Very high tax rate. Social Security. Need I say more?

FDR bankrupted this country with his New Deal. We are going to see more and more of the effects.

The prosperity after WW2 was great. Let's review the facts again after all the Baby Boomers have retired.

(Was the prosperity a mirage? Or was it a natural result of the demographic hump? What will happen when there are not enough workers to support the system?)

Europe has even more social programs, and they are seeing more ill effects earlier.

I know I will not be productive if I get fed anyway and I cannot get rich by being productive.