14 Pages Posted: 20 Jan 2008
The government can, and should, intervene in the free market to reduce inequality in the distribution of wealth. We simply do not have to settle for a society where the top 5 percent of households have dozens of times as much income as the bottom 20 percent and hundreds of times as much wealth. We should combine the individual income tax and the Social Security payroll tax into a single, comprehensive income tax system with a broad base and low tax rates on earned income. We should also keep the current estate tax or, alternatively, replace it with an annual wealth tax. Even a modest annual wealth tax could raise $50 billion a year.
Keywords: wealth, tax, inequality
JEL Classification: D31, H20, H23, H24, K34
Suggested Citation: Suggested Citation
Forman, Jonathan Barry, Managing the Beast: How Government Can Reduce Wealth Inequality. Georgetown Journal on Poverty Law & Policy, Forthcoming. Available at SSRN: https://ssrn.com/abstract=1033902