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upper two-thirds. Today, fewer than one-eighth of consumer units have an income, adjusted for the change in the level of prices, as low as that of the lowest third in the middle 1930's. |
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Clearly, these are all far more extravagant programs than can be justified to "alleviate poverty" even by a rather generous interpretation of that term. A program which supplemented the incomes of the 20 per cent of the consumer units with the lowest incomes so as to raise them to the lowest income of the rest would cost less than half of what we are now spending. |
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The major disadvantage of the proposed negative income tax is its political implications. It establishes a system under which taxes are imposed on some to pay subsidies to others. And presumably, these others have a vote. There is always the danger that instead of being an arrangement under which the great majority tax themselves willingly to help an unfortunate minority, it will be converted into one under which a majority imposes taxes for its own benefit on an unwilling minority. Because this proposal makes the process so explicit, the danger is perhaps greater than with other measures. I see no solution to this problem except to rely on the self-restraint and good will of the electorate. |
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Writing about a corresponding problemBritish old-age pensionsin 1914, Dicey said, "Surely a sensible and a benevolent man may well ask himself whether England as a whole will gain by enacting that the receipt of poor relief, in the shape of a pension, shall be consistent with the pensioner's retaining the right to join in the election of a Member of Parliament."2 |
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The verdict of experience in Britain on Dicey's question must as yet be regarded as mixed. England did move to universal suffrage without the disfranchisement of either pensioners or other recipients of state aid. And there has been an enormous expansion of taxation of some for the benefit of others, which must surely be regarded as having retarded Britain's growth, and so may not even have benefited most of those who regard themselves as on the receiving end. But these measures have not destroyed, at least as yet, Britain's liberties or its predominantly capitalistic system. And, more important, there have been some |
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2 A. V. Dicey, Law and Public Opinion in England, (2d ed., London: Macmillan, 1914), p. xxxv. |
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