Goal-Oriented Taxation: A Brief Discussion of the Living-Space Tax

Abstract

Many Job Guarantee programs argue that the financing of the program is not a fundamental problem. The program’s funding depends upon a recognition that the government is able to spend the financial resources required to implement a job guarantee because there are no fundamental constraints to government spending, as in a gold-standard world. The value of the currency is not strictly determined by the scarcity of money and there is not an operational constraint on the amount of money that can be issued. Rather, the value is driven by the fact that the issuer of the currency will accept the currency in payments to itself. One can always use the money of a sovereign nation to pay taxes, so the money will have value. Since establishing a strong taxation system is one of the ways that a government may “drive” the value of its currency, the scheme of taxation becomes of interest to this line of research. Various taxation schemes may be explored to determine a more “effective” tax base. Common taxes are income and sales taxes, where the production and consumption of goods is taxed. As the concern over both environmental waste and resource use become policy concerns, a carbon tax might be a useful tax to consider. These taxes are not necessary to “finance” government spending, but rather are a necessary means by which a significant portion of the population will demand the currency so that they may pay their taxes, driving the value of the currency. This chapter will consider these issues and offer an alternative tax that will both drive the value of the currency while pursuing alternative environmental pollution and resource use goals.

The author is an Assistant Professor of Economics at Eastern Oregon University and Research Scholar at the Binzagr Institute for Sustainable Prosperity.