For nearly every Friday since June 2014, I have taken part in the second half hour of Radio Roundtable with Cliff Dezell at 1:30 p.m. at CFIS 93.1FM.
During one of these informative discussions, my boss and fellow panelist, Neil Godbout, nearly ejected his lower jaw in astonishment. The reason? Apparently, he could barely contain his shock at hearing me advise Alberta to "grow up and get a sales tax." Given his shock, an explanation might be in order.
A Conservative endorsing a tax? Isn't that a contradiction? Well actually no, not really. While I don't care for those who make micro-differentiations within political camps, I will bow to it momentarily to say that certain "conservatives" would have you believe that all levies are evil, and I will have you know with absolute certainty that such thinking is moronic beyond scale.
Taxes are a reality, as Benjamin Franklin so morbidly reminds us, and so the only question left is how best to tax, and, in effect, regulate the economy, while doing the least harm. This question is more important than it seems, as economic policy, like legislation, can encourage responsibility for both governments and individuals or the exact opposite.
To tax unjustly and mismanage the economy, simply follow these steps: penalize those who work harder by taxing higher incomes more; dissuade intelligent investment by lowering the central bank's interest rate to less than inflation while simultaneously eating into gains from stocks, property, and savings. While people are speculating and taking out unsustainable loans on the low interest rate, be sure to keep consumption taxes low so that even people who remember the Depression are tempted to throw all cares to the wind. Once you've gathered these misappropriated revenues, put them all in a single pile so that public departments are not encouraged to be fiscal but rather to spend one another's money. Act surprised when things go wrong, wring your hands, spend a deficit on inflationary stimulus, and rinse, wash, repeat.
To tax morally and properly manage the economy, follow these steps: flatten and harmonize income tax to a maximum of 15 per cent combined on all levels of income, while allocating at least 1/5th of this revenue to the most local jurisdiction. Sales tax should also be harmonized and possibly even raised to a max of 20 per cent, replacing all other consumptive taxes including luxury, sin, and carbon levies, while again allocating one-fifth to the most local jurisdiction. Destroy all tax exemptions, writeoffs, or credits of any kind and nullify business taxes, as exemptions are redundant in a flat tax economy and only consumers are hurt by eating into corporate profits. To make money off of corporate enterprises, do not let central bank interest rates ever dip below five per cent, thus reducing inflation, helping savers, and encouraging smarter investment planning.
Finally, take these justly acquired revenues and allocate them to government departments based on a preconceived rubric, while assuring departments that money saved will be kept for them next year. Ink balanced budget legislation into the constitution or charter of the relevant governing body immediately, then sit back and watch the economy hum like never before. Also, if you feel like it, you can nominate me for a Nobel Prize or Governor General.
Typically, I would admit all this sounds idealistic, but that would require me to say that Canadians are immature citizens incapable of seeing the light and I will concede no such thing. The truth is that the policies which I've just described have been a reality throughout the world at one time or another, and the reasoning behind it is sound. In the end, people don't want the government to bribe them or their employers with the money it took last year, but rather an economic system that guarantees hard work and smart investment actually pay off.
