Piketty: "Violent Shocks" Needed to Raise Tax Rates
War is the health of the state.
I think it would be a big mistake to oppose the objective of global progressive taxation of income and wealth with the objective of class struggle and political fight, for at least two reasons. First, making this tax reform possible would require a huge mobilization. This has always been the case in the past. All the big revolutions engendered a big tax reform. Take the French Revolution, the American Revolution, or World War One: although it was not a fiscal revolution initially, through the Bolshevik Revolution, it had a huge impact on the acceptance of a progressive tax regime and more generally social welfare institutions after World War One – and even more so after World War Two. These were fiercely opposed by the elite and by the right just before these shocks, so this shows that we need a big fight and sometimes violent shocks to make progressive tax accepted. It would be a big mistake to think of progressive taxation as a technocratic process that comes quietly from a minister and experts. This is not at all the history of taxation.
This is Thomas Piketty’s statement in a recent interview. The interview, by by Antoine Dolcerocca and Gokhan Terzioglu, is titled “Interview with Thomas Piketty: Piketty Responds to Criticisms from the Left.”
Reading it, I was reminded of Robert Higgs’ thesis in his classic book Crisis and Leviathan. The difference? Higgs decried the growth of taxation and government that came about because of war. Piketty welcomes it.
HT2 Tyler Cowen.