From: Ernesto Screpanti (screpanti@UNISI.IT)
Date: Wed May 19 2004 - 08:07:27 EDT
At 07.17 19/05/2004 -0400, you wrote: >Hi again Ernesto. > >Previously I asked: > > > But, so long as capitalist relations of production prevail, what > > is the impact of a heavily progressive income tax on the accumulation > > of capital? > >You replied: > > > I do not precisely know. But I do not think it would dramatically > > impair it. > >It might depend on just _how_ heavily progressive the income tax is. >E.g. (supposing also that tax holidays, subsidies, and loopholes >for corporations and investors are also closed) , a _very_ heavy >income tax (e.g. an effective tax rate of 95% for the top 10% >income earners) would mean that there would be dramatically >less funds available for investment in c and v and hence there >would be de-accumulation of capital -- even though demand by >working-class families for consumption goods might well be >increasing. Yes I agree. By the way, this theory recalls Laffer's curve. But a tax rate of 95% seems quite irrealistic. >*Of course*, this couldn't happen without workers' >struggles *and* capital has some options (since after all there are >nation-states with sovereignty which develop their own tax and public >finance policies) including a "capital strike" and re-locating where the >"investment climate" is better. And there are more ominous bourgeois >options as well, e.g. a coup d' etat and the re-emergence of fascism >as a means of overcoming a state-imposed policy that violates the >best interests of the bourgeoisie. To prevent this from happening, the >working-class might have to organize their own armed militias (recall >this week's news from Venezuela). This suggests that if the tax is >heavy enough then the class struggle would become (non-metaphorically) >an actual class _war_. Such a circumstance might coincide with what >Lenin and Trotsky called "dual power" and probably wouldn't last too long >since one side or the other would succeed in forcibly imposing its will. This is a possibility. A revolution triggered by Laffer's curve is an interesting Idea. But I think it is difficult to realize. At least in modern capitalist systems capital strikes an coups d'état are unnecessary. A Maastricht Treaty, a Stability Pact and mediocracy are much more efficient. > >In solidarity, Ernesto
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