Taxation and Tax Policies Are a Prime Example of a ‘divide and conquer’ Strategy :

updated March 19, 2018

by Jessica Lim – policy analyst, researcher and Head of 5woodrabbit.org – a public policy organization

TOPIC : Taxation and Tax Policies Are a Prime Example of a ‘divide and conquer’ Strategy

Is taxation really necessary? If we didn’t have taxation a very large chunk of government and private/corporate energy and time could be saved

If we further combined this systemic change witha basic income another big chunk of government activity, i.e. social services administration could be eliminated as well as society could better prepare for the wave of job automation that is coming

DRAFT POLICY PAPER ON REFORM OF TAX POLICY

comments? criticisms? you can leave your responses at the bottom of the page

IDEA: could we crowdfund government spending instead? this would most probably only provide a minor portion of funds necessary

IDEA: why doesn’t Canada and other resource-rich countries have soverign wealth funds, like Norway, ME countries, etc.?

crowdfunding is a donation-based model that is enabled by modern day technology. the old analogue would be passing the plate at church, or passing the hat (a street musician) * Scarlett O’hara donates her wedding ring in ‘Gone With the Wind’ to help support the troops

crowdfunding would increase citizen engagement as people would feel that they can target their tax spending only to things they feel are worthwhile.

govt would have to support spending from other sources if they can’t get crowdfunded. eg. if nobody tax supported a war in afghanistan govt would have to borrow instead.

another example: i personally would help crowdfund government pilot project of – Universal Basic Income – but only if it was for a sustained period of time, e.g. 10 years, because I don’t think it’s worthwhile to have a pilot project of say 3 years only which might get cancelled when the next government comes in.

And most of the test subjects of a pilot project would not feel the ‘security’ that the ‘floor’ of the basic income is supposed to provide if they know there is a high probability of it getting pulled out from under their feet with the next change of govt.

For example would someone really feel secure enough to quit a job and change careers if the basic income is not permanent?

Our current model of government finance is:

1. taxation. (which creates no end of dissension eg. self-employed vs. salaried, rich and poor, 1% vs. the rest, “eat the rich”, savers vs borrowers, immigrants vs settled, indigenous peoples vs. others in the case of Canada, Australia, etc).

PERSONAL ANECDOTE: I remember a lot of resentment growing up in Calgary (not me personally, but other people at school why Indian kids got free milk and lunch, etc. This in turn, created a lot of discrimination against the native kids…)

2. fees (which are a headache for everyone, and which probably (research shows) don’t net any revenue or very little after all the administrative costs are factored in. also this doesn’t take into account the loss of productive time every citizen incurs when faced with all the bureaucratic hurdles, red tape…eg. small business owners’ time spent changing over their accounting systems every time there is a GST/HST change)

or frustration people feel paying incrementally more fees for drivers license fees, etc. loss of productive time for everyone creates additional stress on the system as a whole, creates gridlock on our streets, psychological burden, etc.

3. borrowing (no constitutional limits on borrowing in Canada) which creates a lot of generational conflict. for eg., there’s been a lot of boomer generation backlash lately. which in turn leads to elder abuse, loss of respect for others in total. when one class of people are influenced to feel that another class of people are a drain on the ‘public purse'

4. selling bonds (i dont think there is any difference between borrowing and this but hey, i don’t have an advanced degree in finance) maybe read Niall Ferguson.

5. creating money out of thin air / quantitative easing, also called QE which is the same thing as debasing the currency but much less visible to the average person.. at least in the old days people could weigh coins to see whether the metals had been ‘diluted’ , or bite them. they would look at the clipped edges of the coins (hence the term ‘clipping coupons’)

anything else?

Case Study

Qatar

has a sovereign wealth fund, as do Norway etc. (begs the question of why don’t we, or USA?) Canada has timber, oil and gas, agricultural land, mineral wealth such as uranium, potash, nickel, etc. in Korea’s case, can we count people as capital, human capital? after all, we live in the age of intellectual property. Then, all countries have human capital.

alberta used to have a Heritage Fund, what happened?

Saskatchewan?

Newfoundland?

if we count the natural resources that each country possesses as part of Treasure/Treasury, does that then become

collateral or capital?

i suspect the reason why we, Canada has no sovereign wealth fund is that there is the added complication of First Nations treaties, as well as Crown Lands. We are still a commonwealth nation…our property law is ‘common law’ based…if you read contracts for oil and gas law you see all the different layers of property rights that can exist on any specific piece of property.