It is somewhat heartening that our European friends, they of the socialistic health care systems and reasonably contented populaces, have begun moving toward something I’ve been advocating for years: taxing the income of certain non-productive elements of our society, i.e., the bonuses of the bankers who have been systematically destroying our society. Britain is imposing a 50% tax on bonuses given out this year, and raising the marginal rate on high incomes to 50% next year. France is set to follow suit, and Goldman Sachs, always ahead of the curve, has already announced that it will try to mask obscene bonuses as stock awards. It would therefore behoove those countries to impose similar taxes on those types of bonuses as well.
There is so far not a whisper in this country about following suit. What is truly amazing is that every attempt at reining these folks in is met with the claim that we will discourage risk taking and “creativity”, both of which got us where we are today. It takes a lot of nerve for the folks who wrecked our economy to claim that they have a right to outsize compensation for the opportunity to do it again. It probably takes a lot of money (but a drop by comparison) to induce our “representatives” to buy into such an outrageous fiction.
The NY Times Op-ed piece to which I’ve linked above contains a description of the British economy that applies here as well:
If banking moves from London to Switzerland, that will really hit tax revenues. For I am not at all sure what Britain does anymore. We don’t really make much. The last piano manufacturer moved production offshore a few months ago. Even Savile Row suits are made in Italy. No, the nation seems to exist solely to shuffle money around, and it’s got that gig only because of the universality of the English language and its convenient time-zone location.
To put it more succinctly, as those hippies sang in Hair, it’s a moving paper fantasy. Our economy is more and more faith based, requiring above all that we (and increasingly, the rest of the world) all believe that it actually does something. Someday, that belief will collapse, and we’ll all be in real trouble. Except, of course, for the people who have created and sustained the illusion, who will be sitting pretty while the rest of us cope with the collapse.