Saturday, September 5, 2020
Daniel Halliday (Melbourne) & Miranda Stewart (Melbourne), On 'Dynastic' Inequality, in The Oxford Handbook of Intergenerational Ethics (Stephen Gardiner (Washington) ed., Oxford University Press 2020):
This chapter investigates whether the replication of inequality is, other things being equal, morally objectionable in ways not applicable to inequality that remains confined to a single generation or ‘birth cohort’. The focus is both theoretical and practical. The chapter considers the philosophical foundations that might lie behind an objection to dynastic inequality, negotiating the diversity of egalitarian views supporting this position, and the complexity around the causal mechanisms at work in cases where inequality has a dynastic tendency. It then discusses the policy reforms that might target inequalities that replicate old distributive trends while leaving newly produced trends more intact, with a focus on tax policy. Current tax rules in most developed economies do not make a distinction between new and old influences on the material distribution. Accordingly, it is likely that the tax reforms implied could be quite extensive. ...
The merit of taxation as a response to dynastic inequality is its uniform application on a metric of income or wealth. The provision of universal, quality public goods to all in a society would also substantially improve the opportunity and mobility of low income and wealth individuals and households. However, as middle and upper income households also benefit from such public goods, it would be important to finance public goods with progressive taxation and to combine this with wealth taxation, if dynastic wealth inequality is to be specifically targeted. This, indeed, has been the main approach to distributive justice of developed country governments over the last 100 years, financed largely by progressive income taxation, land and inheritance taxes. Towards the end of the 20P thP century, this approach faltered, as inheritance taxes and other capital taxes have been abolished or reduced, leading to a renewed challenge of countering dynastic inequality in the 21P stP century