"When you begin to think outside the box, you often become some other "leaders" lousy follower. That usually costs something" (Andy Rayner)

"Our guardian angels are bored." (Mike Foster)

It's where I feel I'm at these days. “In the second half of life, it is good just to be a part of the general dance. We do not have to stand out, make defining moves, or be better than anyone else on the dance floor. Life is more participatory than assertive, and there is no need for strong or further self-definition” (Falling Upward. Richard Rohr.120).

Tuesday, April 17, 2018

Even Socialists Have A Tax Threshold


The Author of Pipi Longstocking, Astrid Anna Emilia Lindgren, generates this interesting story.


In 1976, Lindgren learned that because of tax laws requiring her to pay both income tax and employer’s fees, she would effectively be taxed at a rate of 102 percent. Though she was generally a supporter of the principles of socialism, paying more than she actually earned appalled her. And so she published a satirical fairytale, “Pomperipossa in Monismania,” about a children’s book author forced to pay exorbitant taxes, in the Stockholm tabloid Expressen. The satire ignited a furious debate over both the tax laws and the reigning Social Democratic Party. Because of her popularity, people listened to Lindgren. Later that year, the Social Democratic party lost the election, giving up power for the first time in 44 years."
(Vintage News. When the Swedish author of “Pippi Longstocking” had to pay 102% in taxes, she fought the injustice with her best weapon: her writing  Jan 4, 2018 E.L. Hamilton)

This got me digging into the economic ideologies at work behind this story.

This is based on "Marginal Taxation" and the idea of tax brackets. The more you earn the higher the tax rate on each bracket of incremental increase in income.  Obviously Lindgren achieved a higher margin of income, and entered a bracket where every dollar was taken back to the state, and more, because of the fees.  Socialism can be the very equalization force it sets out to be. I'll  spare you more critique about the Socialist Economic ideology rabbit trail I followed.

"Marginal tax rates are applied to income in countries with progressive taxation schemes, with incremental increases in income taxed in progressively higher tax brackets.
In economics, one theory is that marginal tax rates will impact the incentive of increased income, meaning that higher marginal tax rates cause individuals to have less incentive to earn more. This is the basis of the Laffer curve theory, which theorizes that population-wide taxable income decreases as a function of the marginal tax rate, making net governmental tax revenues decrease beyond a certain taxation point."

-Wikipedia 

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