Thursday Morning Links

This and that for your Thursday reading.

- Nathaniel Lewis and Matt Bruenig discuss the relationship between massive inheritances and ongoing wealth inequality. Nick Hanauer makes the case for much higher taxes on the wealthy as part of a plan for improved economic development, while a new Ipsos poll finds that three-quarters of Americans are in favour of that possibility. And Larry Elliott reports on a new IMF study which concludes that a more progressive tax system will reduce inequality without affecting growth:

The Washington-based IMF used its influential half-yearly fiscal monitor to demolish the argument that economic growth would suffer if governments in advanced Western countries forced the top 1% of earners to pay more tax.

The IMF said tax theory suggested there should be “significantly higher” tax rates for those on higher incomes but the argument against doing so was that hitting the rich would be bad for growth.

But the influential global institution said: “Empirical results do not support this argument, at least for levels of progressivity that are not excessive.” The IMF added that different types of wealth taxes might also be considered.
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IMF research found that between 1985 and 1995, redistribution through the tax system had offset 60% of the increase in inequality caused by market forces. But between 1995 and 2010, income tax systems failed to respond to the continuing increase in inequality.

It also said inequality should be tackled by giving a more pro-poor slant to public spending.

“Despite progress, gaps in access to quality education and healthcare services between different income groups in the population remain in many countries,” Gaspar and Garcia-Escribano said, adding that in rich countries men with university education lived up to 14 years longer than those with secondary education or less.

“Better public spending can help, for instance, by reallocating education or health spending from the rich to the poor while keeping total public education or health spending unchanged,” they added.

- Michael Nienaber reports on a push by German trade unions to translate productivity gains into reduced hours of work. And Martin Regg Cohn argues that corporate fearmongering isn't a valid reason to avoid ensuring that workers make a living wage.

- Meanwhile, the Mowat Centre and Smart Prosperity Institute study (PDF) how decent work fits into a green economy. And George Monbiot theorizes that a combination of private sufficiency and public luxury could represent the economic model which allows us to reconcile higher standards of living with environmental sustainability.

- Finally, Geoff Leo reports that the Wall government has ordered public servants to use private e-mail accounts to deal with sensitive issues in order to avoid any public record of their actions. And Alex MacPherson notes that the Sask Party has refused (or neglected) to provide information to allow the Auditor General to even assess the effects of its destruction of the Saskatchewan Transportation Company.

Tuesday Afternoon Links

This and that for your Tuesday reading.

- Doug Saunders interviews Thomas Piketty about the need for checks on the undue accumulation of capital, and the readily available means of achieving that end:

To solve the problem of rising inequality, you propose small worldwide taxes on capital transfers and on wealth, and prohibitive taxes on extreme incomes and inheritance. But such taxes are not popular today, and there is little sign they will catch on. Does this make you pessimistic?

I believe in the power of ideas, I believe in the power of books, but you have to give them time. Books have a very long-term impact, and it’s never a deterministic impact – you can never say “this book has had this particular impact on policy.” It’s much more complex.

The kind of policy conclusions I derive in the book are already in the public debate. For instance, we have this talk about tax havens. Five years ago, people were saying that nothing would ever happen; Swiss banks would keep their accounts secret and would never accept having automatic transmission of information. And then suddenly there were U.S. sanctions against Swiss banks and things began to change. I think these general moves will continue.

- Kayle Hatt takes a look at the spin behind Tim Hudak's slash-and-burn plan for Ontario - as well as what the province stands to lose through the wanton destruction of public services. And Esther Epp-Tiessen explains why we should see a contribution to the social good in the form of taxes as part of our duty to each other.

- Which means Victor Adebowale and Henry Kippin are right to comment on the need for people to feel they have some say in how our public services are set up - rather than being stuck with a corporate model (italics removed):

[Citizens'] notions of public good appear increasingly out of step with reforms being made to our current public service model. The highest proportion of those surveyed see public services as ‘important to the whole community’ (33%), and ‘available for everyone to use’ (33%) – somewhat at odds with a dominant narrative that has focused on targeting, cuts and, at the extreme, ‘deserving’ and ‘undeserving’ welfare recipients. No major party talks any more in terms of universal entitlements or the ‘same services for everyone’ – partly because of public finances, but also because a batch of studies tell us postcode lottery is already a reality.
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 It is not enough for future actors in public service markets to prove delivery competence, financial integrity and an appetite for risk. Private profit and producer interest has clearly been pursued over public purpose in some cases, and this must change – again, a relationship with two sides.

- Meanwhile, the Mowat Centre offers a proposal for corporate tax reform - featuring a far greater focus on rents and windfall profits rather than normal rates of return on investments.

- Finally, Mike de Souza reports on how the public interest is being left out of the National Energy Board's considerations in enforcing the rules governing pipelines.

Worth retiring

Shorter Martin Hering and Thomas Klassen:

We just had the most radically original idea ever: Canada could form a catfood commission of its very own! Can you feel the innovation?