There was a seminal set of studies in this very topic conducted in the
eighties, led by Anwar Shaikh and Ertugrul A. Tonak. Tonak's PhD is a
definitive analysis of the question for the USA. It is entitled "Tonak, E.
Ahmet, 1984, A Conceptualization of State Revenues and Expenditures: U.S.
1952-1980, Unpublished Phd Dissertation, New School far Social Research." I
have a scanned version of Tonak's paper on unproductive labour but I haven't
scanned the thesis. Perhaps he has an electronic version of it. If there's a
lot of interest with Ertugrul's permission I'd like to scan it for
distribution.
Anu informs me he has written up the material on his website
http://homepage.newschool.edu/~AShaikh
A group of collaborators followed up on Shaikh and Tonak's work by
conducting studies in a number of countries and the results were to be
produced in an edited volume which unfortunately never saw the light of day.
In Europe we ran for a few years a study group part financed by the Hamburg
institute for Social research, and as a result a very detailed study of
Germany was done, the German researchers being Peter Barthelsheimer and
Harald Wolf (who now leads the PDS fraction in the Berlin parliament). Again
I have this but have never scanned it.
Other names I can remember are Paolo Giussani and I think Rafat Fazeli who I
think is somewhere in the Mid-West. Isa Bakker was going to produce the
edited volume.
I am sure that Shaikh and Tonak have published their findings but I don't
know where. I am copying this correspondence to them hoping they can provide
information. Some of the methodology is strongly behind my chapter in
'Quantitative marxism' (ed Paul Dunne, Polity 1991). But basically most of
the work is subject to the 'gnawing criticism of the mice'.
In a way it is one of those studies like the enquiry into the meaning of
life in the Hitchhikers guide to the Galaxy: an enormous amount of work, and
the answer is 42.
What we found, almost across the board, is that at least if you analyse the
matter in class terms (i.e. what is your primary source of income), what you
put in is what you get out. That is, to within an extraordinarily small
margin of error, and almost across the board (perhaps some variation in
terms of historical periods; not many third world countries, no
non-capitalist economies), there is *no* transfer of income as a result of
the tax and benefit system between those whose primary source of income is
the property they own, and those whose primary source of income is the sale
of their labour. In the case of Germany it is quite extraordinary, because
we had access to microstudies in fields such as education where each
individual household was categorised, basically, by whether it was a
bourgeois household or a workers' household. the micro studies utterly
confirmed the macro data; it's a rare thing to see micro economic and macro
economic data tie up so simply but this time they did.
Thus it seems that, first, empirical evidence does not support the
'socialist Keynesians' who hoped that macroeconomic demand management could
distribute from one class to another. However, second, it is hard to use the
tax system to 'rob' the working class by anything other than a marginal
amount. Bog-standard 'capitalist exploitation' is thus *the* primary
mechanism for the extraction of surplus under capitalism. (I did find
however that usurious interest-payments were an important secondary
mechanism at least in the UK). But this remains a 'market' mechanism rather
than a political, state or bureaucratic mechanism.
It is as if classes have an instinct for what is capitalistically fair;
attempts to use the state system to override the automatic distributive
mechanisms of the market itself seem by and large to be temporary and
somewhat futile.
Having said that, there is an absolutely vital function of tax-and-spend
redistribution not covered by the above, namely redistribution *within*
classes. This seems to be its main function. Tax and benefit systems surely
can (but do not necessarily) provide for those that the market places at the
bottom of the pile, give them (in Bevan's words) 'Freedom from Fear' etc.
Thus in the original form of Ted's question the answer is 'no: in a
redistributive system the rich are not so rich and the poor are not so
poor'. Therefore the above is not a case 'against Keynesianism'. It simply
finds that Keynesianism is not socialism.
Alan
-----Original Message-----
From: email list for Radical Statistics
[mailto:[log in to unmask]]On Behalf Of Ted Harding
Sent: 06 February 2004 10:46
To: [log in to unmask]
Subject: QDQ: Wealth, Tax, Benefit?
Hi Folks,
A quick and dirty query occurred to me this morning, to which
I basically want a quick and dirty answer ... however, proper
analysis of the question would undoubtedly be very complex and
hedged with some very dark imponderables ... nevertheless, some
of you may have informed views!
We all pay taxes, roughly in proportion to our incomes.
These taxes are supposed to pay for benefits which we may all
receive in various degrees.
But my QDQ is: Do the wealthy receive more benefit per tax paid
than the unwealthy?
Otherwise put: When I pay tax, do people richer than me get more
out of my tax than I do?
It is supposed to be the other way round: in theory, taxation
could be a mechanism of (partial) redistribution of wealth, to
reduce inequalities (e.g. the ideals of the NHS). The poor should
see more benefit in proportion to the taxes they pay than the
rich do.
However, sometimes I have my doubts. Recent news stories have
re-awoken these. In particular there are some very expensive
people in Government and Civil Service whose recent activities
seem of doubtful benefit to me. I suspect that wealthy people
and rich organisations/institutions see benefit (if any) from
this; I don't think I do!
Comments welcome.
Best wishes to all,
Ted.
--------------------------------------------------------------------
E-Mail: (Ted Harding) <[log in to unmask]>
Fax-to-email: +44 (0)870 167 1972
Date: 06-Feb-04 Time: 10:45:49
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