Governments Should Try To Reduce The Gap Between Their Richest And Poorest Citizens

When society is left to function on its own without any means of moderation, it often reaches a point of extremity. The status quo we see now reflects this concept. The richest of our country fly to another country to have a grand luncheon while the poorest go starving for days. In such a situation, the government as the moderator of society must step in to account for the gap between the two boundaries.

Before moving onto substantive points, the Proposition defines “government” as a formal entity belonging to a state that enforces the state’s policies. Its task lies in acting on the behalf of its citizens’ welfare and happiness. For the scope of this debate, we will discuss only democratic governments, in which all eligible people enjoy the right to make their own decisions under the principles of freedom and equality. The phrase “reducing the gap” points to our policy. Our policy may be described as a combination of government-initiated actions—which includes increasing progressive income taxes and providing education for the unemployed and the underemployed—directed at reducing the wealth gap to a reasonable degree.

Such policies are the most effective in bridging the wealth gap. The private income tax in Sweden borders on 15.8% as contrasted with 3.4% in Korea. The effect of South Korea’s Gini coefficient prior to redistribution is 0.374 and, after, 0.358; thus the redistributive effect of its tax policies only calculates to 4.5%. Contrast this with the 101.4% effect of Sweden’s, which achieves a stellar Gini coefficient of 0.218, and one immediately sees the immense contribution redistributive policies have on inequality levels.[[Direction for Social Welfare Based on International Comparison of Income Distribution, Kyungjun Yu(2003), KDI]] As for providing worker education programs, investments on education, job training, and employment services must increase in order to better the human capital of the poor.[[http://www.marketwatch.com]]

What often escapes our notice is the fact that bridging the wealth gap actually heightens economic efficiency. A wide wealth gap, if left unresolved, creates mortal economic problems which are twofold: one, it establishes an unhealthy imbalance between production and consumption; two, relying on social security alone creates its own problems in the long run. A country should alleviate the unevenness in wealth distribution by going beyond just social security and enacting policies such as direct income tax increase and professions education.

One chronic problem the wealth gap causes is an imbalance between production and consumption. As the market cycles it creates added values. A direct corollary to wealth gap is that such added values become concentrated in the hands of the minority, or the rich. The rich, however, does not consume quite as much as the gap in wealth. The amount of goods bought for livelihood does not differ significantly among income groups and, even when luxury goods are accounted for, the money consumed does not match the gap in income.[[http://www.successguide.co.kr/170]]Because the degree to which members of the private sector consume is rather limited, when added values collects excessively under the rich individuals, consumption fails to follow up with production. Because production becomes less profitable than it could be under evener income distribution, producers do not invest surplus values in production but more and more capital become subject to speculation. Thus, for producers, emphasis shifts from using capital for production to making unearned income through speculation. This leaves an unhealthy precedent for the economy.

The current social security system is already showing its limits. It causes well-fare sickness, because it fails to provide incentives to work. Second it incurs significant deficits, as social security costs are irrecoverable. $2.5 trillion us debt is attributed to social security alone.[[federalbudget.com]]

The societal system is hugely responsible for the uneven distribution of wealth. By definition, democracy requires equal representation of all eligible individuals. Despite our claim that the capitalistic ideal of “fair” opportunity achieves equality, we often find such equality questionable if not downright non-existent. Under the status quo where the wealth gap is wide and poor or rich statuses become inherited, a child’s life is primarily determined by the socioeconomic status of his family. The private property cherished as the well-deserved merit of competition grants an incredible advantage to the next generation. A prince in the United Kingdom enjoys a luxurious life from the very birth with maids and magnificent palaces, receives the accolade, and spends dozens of million dollars on a public wedding–and the best part is that he can and does appropriate much of that cost from taxpayers’ pocket. In contrast, an African American has a higher chance of going to prison than that of going to college.[[http://www.radford.edu/~junnever/bw.htm]]The fair opportunity and competition mean democracy should be based on meritocracy. Then how can someone, for just being born with a title or being related with a millionaire, have more chance of success in the society; and how can a society that allows such vicious cycle call itself democratic?

The question of fairness should prompt the government to take an active stance in redistributive measures through income taxes and provision of education, including job training and employment serivces, to the poor. This takes society closer to equality of opportunity, which accords to the ideal of fairness. The ideal gives the government justification to actively make up for the societal system that causes inheritance of rich and poor statuses, of capital that creates more capital and furthers the wealth gap.[[http://www.msnbc.msn.com/id/16115342/ns/business-answer_desk/t/why-wealth-gap-bad-thing/]]

The Opposition fails to rebut our reasoning but only nitpicks at our policy by suggesting an alternative, the flat tax. In doing so it makes no response to the prime virtue of redistributive tax–sustainability–which we argued earlier. Moreover it merely insists on flat tax because it supposedly 1) provides incentives and 2) collects more tax revenue. We will prove that flat tax fails on both grounds.

Let us first reinforce our unrebutted point that taxation aimed at redistribution is sustainable. One common way is to rely on social security alone to bridge the gap, but such is already showing its limits. Not only does it incur significant deficits, social security cost is irrecoverable. Moreover, whereas the Opposition conceded that pooling the tax revenues toward education is a positive investment, such is only long-term and must be coupled with direct redistributive measures.

The Opposition claims that redistribution through tax “discourages earning more money … since [people] have to pay more taxes.” This statement makes no sense even in the intuitive context of human nature, the insatiable desire to have. Because entrepreneurs or high-income groups in question perceive higher tax rates, in order to secure a certain level of disposable income, they will exert themselves harder than in otherwise conditions.[[http://www.cis.org.au/…pm-66.pdf]] Profit motive and incentive for entrepreneurship remain intact.

There was also mention of clearing loopholes inherent in progressiv taxing. One, as the focus is on value, devising a legally fool-proof policy is out of the scope of this debate. Two, the presence of loopholes should not be an excuse to abandon a necessary policy. It is at most a factor to consider. Three, unless the gov is totally incapable, progressive tax generates more revenue than flat tax.[[http://www.lolife.com/…prog-tax]]

The Opposition said, our way doesn’t “stimulate the accumulation of wealth but consumption.” Thanks–exactly!

What does equality mean? Does giving open access to the capitalistic system and one vote ensure that people are equal?

We have three levels of response. First of all, the opposition fails to engage with our point. The proposition showed how private property generates inequity in opportunity for the next generation—how the system contradicts itself. The opposition naively reiterates progressive tax is against equality, when we proved things were not equal. Thus we go back to the inherent contradiction; while the opposition agrees that gap must be reduced, it opposes to principles that show why.

Besides, what does Opposition mean by equality? There comes the second subpoint; the Opposition does not have proper reasoning. It believes there are “natural rules” and that it is natural that income should be proportional to income. However, who draws the line on what is natural and equal? Why should “extra” governmental regulation be considered “artificial” when a legal system already requires governmental involvement in society—not to mention the “extra” rules are already partially incorporated into the “natural” system by 16th Amendment of the US constitution, for example. Who decides whether equal percentage from income is the right interpretation of equality—why not equal amount or different amount that invokes equal sense of loss? Simply saying progressive tax takes away more percentage is not a logical reasoning of equality.

Since the Opposition does not have proper reasoning, the argument based on principle becomes quite similar to simple preference. The opposition reintroduces the corruption, which, as we showed in the first point, only has minimal influence as drawbacks. Only one thing new and quite convincing is corporate social responsibility, the alleged solution by the market. However, CSR is not altruistic, but a reluctant response to growing social demand.

and note that our policy aims to do so in the long-term.

The Proposition is confused about the Opposition’s standpoint. The Opposition lacks two elements in their case: core values and substantives supporting them. Due to such absence, we do not get why—and even whether—the Opposition opposes the motion. Its introduction claims that its strategy is not to disagree on closing the gap but to suggest a better alternative. It does not truly oppose the motion but drags the arguments to a policy debate which this isn’t. But even if this were to be a policy debate, the Opposition has shown no link as to how its policy can better achieve equality. It claims “Make the pie bigger, and there will be bigger crumbs left for the poor.” However the Opposition only argues how flat tax will promote economic growth, not how “growing the pie” will benefit the poor more—which is essential especially seeing how that slogan of neo-liberalism has only increased the gap for past decades. [1]

As the opposition never proved the link between gap reduction and economic growth, virtually all of their rebuttals and one constructive point, except those about equality, have no place in this debate.

The Opposition’s misunderstanding continues with straw man fallacies. Not responding directly, the Opposition rebuts superficially similar yet false representations of our points. We pointed out that the system does not guarantee fair opportunity, but the opposition argues that some of the poor did succeed. The focus is not the possibility, but extremely low probability; behind a few successes lies millions of the poor who won’t appreciate the opposition’s “liberty to choose destiny.” We pointed out the Opposition presumes—or purposefully pretends—existence of equality, or artificiality of governmental actions. The opposition responds that the latter being in the Constitution does not prove anything, while it was simply an example to show no line can be drawn for artificiality without sound reasoning. We pointed out progressive tax will better achieve redistribution. The opposition dangles on incentive and corruption, both of which are too minor to undermine our policy. The Opposition’s obsession on progressive tax is also a fallacy; the tax and our comprehensive education of the poor aim to amend the system itself with fair opportunity that leads to economic independence—a merit to which the opposition never responded. The Opposition’s ultimate regression to the straw man fallacy manifests itself in the example of the US progressive tax. Not only is our policy much bigger than a simple tax collection, but also the increasing gap in the US originates from various factors that altogether form the very system we try to reform.

While we both have better understanding of the spirit of this debate and present arguments accurately reflecting our socioeconomic reality, the Opposition stumbles over lack of values, misunderstanding, misrepresentation, and ultimately, lack of a standpoint.

1) http://www.soci

Despite the superficial image of the flat-tax maintaining equity across all economic sectors, the reality is that the system rather impacts various sectors differently. On the surface the concrete rates look universal and simple. However the end result is that the lack of flexibility puts the same rates on strictly different things. The flat tax places the same rates of taxation on all products and services as well. Under the seductively simple veil of so-called equity, products of luxury are wrongfully given the same rates as cheaper alternatives, for example, schoolbooks would be given the same rates as pornographic novels. The flat tax is also a problem as it simply shifts administrative costs to onto businesses. The flat tax, as seen in Australia, will target smaller businesses harder than larger corporations.[[http://neweconomist.blogs.com/new]] As for general economic growth, such a system also does not allow for the incentives and flexibility that attracts foreign investors. The progressive tax however establishes a buffer for the lower class in which allows them to be protected from the customs and sales tax that tends to hit lower-income groups more so than the rich. Regarding economic growth, a proportionately lower tax for the poorer allow them for more room to invest in both entrepreneurship opportunities and for important home investments like home improvement, child nutrition and health, and child education. Moreover, more jobs do not necessary mean a narrower wealth gap; the Opposition makes a naive mistake of equating more jobs with higher wages. As economic growth continues, the higher income groups, a great majority corporations, will profit more than the lower income groups do, furthering the wealth gap.[[http://www.socialistworld.net/doc/2562]]

The Proposition stresses once again: economic growth does not automatically narrow the wealth gap. In fact, research shows that throughout history it has worsened it. Flat tax is not the solution.