Public Money,
Private Money, Work Income, Registrarial Income.
Avoiding the Trap
of Unlimited Income Concentration.
Daily the news alert us about costs
of malpractice involving public money (money here also meaning wealth and
value). A simple reflection leads us to see that so much public money as
private money originates or is generated by the summation of all work
realized to produce it, so before it is public or private money we call it “original”
money. Some of this money becomes public through taxes and other mechanisms.
The rest becomes of private nature; it can be by overtly illegal or by legal
means (not necessarily fair). Legal money becomes private property by two ways:
1)As a direct compensation for work done, a more or less reasonable relation
with work complexity, duration, risks, etc. is perhaps often present. 2) Through
mechanisms that we call registrarial (in the sense of registered in conformity
with the universe of the current legal rules referring to notarial registry,
vested rights, documents), which indicate the share to be allocated to each
one, from the “original” money/wealth. These legal rules or laws are often the
outcome of power relations also strongly rooted in the past and not based on logic
and merit. So it seems fair to say that there is at least a moral malpractice
involving lots of private money since very high values are appropriated
by relatively few people, often without counterpart of any work at
all; or the work or activity which is said to correspond to such huge incomes
seems largely under what could reasonable be expected. Dramatic magnification
of these shocking distortions of income by the financial system occur, since
having huge amounts of capital available to invest, this small fraction of the
population expands greatly the concentration of income by mechanisms where
money generates money and discard meritocracy. A healthy way to correct this
situation appears to be highly progressive income taxes, but without inhibiting
entrepreneurship. A taxation following
sigmoid curves or similar to the letter “S” something right tilted, has been
proposed. By the way, these are the kind of curves found in our blood’s oxygen
binding by hemoglobin graphs, in his function to deliver the vital oxygen to
organs and tissues according to their actual needs, related to the work
performed to serve the healthy functioning of our body. Money circulating
adequately could bring health to humankind’s social body? These "sigmoid" or “centripetal“taxes would be very low for modest incomes and
approaching 100% for the upper portions of extremely high incomes (here
necessarily all kinds of income should be considered, both wages, wage
supplements, commissions, dividends,profits, rents, inheritances, donations and financial income of any kind, no
exceptions). One should note that even someone with a very high income, will
have low and moderate taxation on the lower ranges of income, which will
allow net incomes still highly different. This taxation will free us from
the trap of unlimited and unjust income concentration, and thereby restoring a
comprehensive meritocracy. To ensure the continuity of strong entrepreneurship
access to abundant and cheap capital is necessary. Hence total tax exemption
would apply for all the values compulsorily scheduled for productive
investments of all kinds, including research and education. If not immediately
used for productive investments, taxable funds are immediately transferred to “Economic and Social Development Banks” with
yields less than the inflation rate or possibly even negative interest rates, but available
to the entitled, for their productive investments. Alternatively, if the
available values are for final integration to the private property by the
entitled, the payment of the “sigmoid” income tax will take place. Such a
mechanism seems also very appropriate for taxation of private inheritances as
well as those involving inheritances of companies of all kinds.
