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the breakfast table: An e-mail conversation about the news of the day.

Paul Berman and Sarah Kerr

from: Paul Berman

Taxing the Poor for a More Egalitarian Society

Posted Wednesday, July 25, 2001, at 1:14 PM ET

Dear Sarah,

The old Bracero Program from 1942, the guest worker program for Mexicans, ended up with a lot people being robbed en masse by their own employers, by banks, and by all kinds of villains. But now Fox has launched an effort to get the robbery victims reimbursed. Funny that none of his predecessors in Mexico tried to do anything similar in the past.



This effort of his offers a model, I would think, for how to prevent or undo some new gigantic swindle or exploitation in the present. The Mexican workers in the United States do need an agent toiling on their behalf. Trade unions, to begin with. The AFL-CIO's new sympathy for immigrant labor is a wonderful development, I think, and ought to help American workers and guest workers at the same time, even if in some ways the two sets of workers are in competition.

And the Mexican guest workers need a government back home that will look out for them--a democratic government, in short. Is Mexico leaning in that direction? Different indications: The jury is out.

I know that Fox's thinking about taxes is influenced by a Harvard professor named Roberto Mangabeira Unger, who has some novel ideas. Mangabeira Unger makes the case that countries relying on a progressive income tax, such as our own citadel of democracy, tend to exhibit a ghastly degree of social inequality. It is because rich people can always wriggle out of paying their taxes, and the government ends up without money to spend.

A value-added tax (which is like a sales tax) sounds bad because poor people spend more of their income than do the rich. But countries that rely on value-added taxes, such as France and Sweden, end up socially more egalitarian. It is because value-added taxes are easy to enforce, and the government has money on its hands, which can be used for social programs. (Of course, the government has to WANT to spend the money on social programs, and not, say, on building a Maginot Line in outer space.)

In Latin America rich people pay hardly any taxes at all, and governments, with a couple of exceptions, tend to do very little for the poor. So taxes have to be raised, as a start. But since you won't get anywhere trying to squeeze the money out of the rich, you need to squeeze the money out of the poor, though it sounds illogical.

Well, that's the theory. Is Fox thinking of his proposed new tax on food and medicine along those lines? I couldn't say. And will Mangabeira Unger's ideas work in Mexico? Or are we beginning to watch one more social earthquake? So far, Fox seems to have done more for the Mexicans living in America (because he has a pal in Bush, I suppose) than he has done for Mexicans in Mexico. But he has another five and a half years to go.

As for being smiley and reassuring, I followed Fox's campaign last year, and on a couple of occasions I saw the man lose it completely. I came away thinking there is a virtue in being smiley and reassuring. I know--not ENOUGH virtue. That's your point, and I agree.

Yours,
Paul

from: Paul Berman

Taxing the Poor for a More Egalitarian Society

Posted Wednesday, July 25, 2001, at 1:14 PM ET
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Paul Berman is the author of A Tale of Two Utopias: The Political Journey of the Generation of 1968. Sarah Kerr is the film critic for Vogue.
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Reader Comments From The Fray:


[Friday Fray Notes: Thank you Roger for an incisive discussion on Central American history, and a great line on cabs in Mexico City. A.G.Android doesn't get to the "Breakfast Table" nearly enough these days, but he kicked off a splendid thread on Stalin here. And Tartwater O'Connor got things going here by asking where Fray posters live. Hazel Motes wants to add Ayn Rand to the moratorium mentioned below. Tom R explained why that would cause consternation at Fray HQ.]


Actually, in the less than safe confines of Mexico City were several prominent independent leftists, like Victor Serge, who were bodily threatened by Stalinist thugs. There's a rumor, in fact, that Tina Modotti was murdered in the back of a taxi cab (the taxi union was Communist dominated) after she started distancing herself from her boyfriend, who had helped to arrange Trotski's murder. As for Arbenz--of course, the CIA intervention was inexcusable, but even back as far as August Sandino, the PC line was not to support nationalist leftists, but to defame them, loudly. So painting Stalin's portrait was not the wholly innocent act Kerr implies--especially as Kahlo and Rivera knew, if anybody did, who the killers of Trotsky were, and what the threat to people like Serge was about. (Serge, by coincidence, also died of a heart attack in the back of a cab in Mexico City--it wasn't a safe mode of transport for a leftist dissenter); whereas I would have to defend those champagne guzzling Manhattan stalinists, who were probably, in the fifties, not guzzling champagne at all. They were probably desperately trying to find money for bail, as they were under attack by the forces of "democracy" in this country--the forces that decided to make being a communist illegal. A little ban on opinion that would have made John Adams, the current fashionable president, very happy, since it reproduced the reasoning of the Alien and Sedition acts.

--Roger

(To reply, click here.)


Sweden and France as so egalitarian because they charge VAT at rates greater than 18% plus they have higher tax rates than the U.S. A tax heaven they are not, but the services that everyone can benefit from are superb from health care to transportation so it could very well be a good trade-off.

I also find the horror at Vincente Fox not doing anything about the two environmentalists convicted based on confessions elicited by torture to be quite so typically American. America might protect US citizens from such actions, but who do you think trained so many of the torturers in Latin America. The CIA plus its allies like Argentina have trained the worst thugs in places such as Guatemala, Honduras, El Salvador and Mexico. I am sure that we are now in the process of training all of the right-wing thugs in Columbia to torture and kill all of their left-wing "narco"-terrorists. Mexico is certainly a very nasty and unfair palce, but America is also nasty and unfair outside of the US

----Martin Kannengieser

(To reply, click here.)


[Wednesday Fray Notes: We haven't had this one for a while: A-Z suggests a moratorium on some words (including Orwellian--see also Slate's "Idea of the Day" on Monday) in the "Breakfast Table." Arthur Stock wants to add "declare a moratorium" onto the list, and, yes, big surprise, lots of Fraysters have ideas for the list.]


It's not the type of tax, but the enforcement that determines tax compliance. During the first years of the Clinton administration, the IRS stepped up its enforcement of income tax laws, and the government's return on this investment was massive. When the Republicans got hold of the Congress, they held hearings where wealthy tax cheats complained about IRS mistreatment and cut the IRS's budget. The results were what you'd expect: more wealthy Americans avoiding the law

--Andrew W. Cohen

(To reply, click here.)



I could hardly agree more with Mr. Berman's sage advice, that readers ought to learn to distinguish between reporting in the New York Times and reporting in the New York Post. When the New York Post has an axe to grind, you know it immediately; it doesn't dress up its political agenda in the guise of "objective journalism" as does the New York Times in virtually every story within its covers. With that in mind, I wonder which Mr. Berman thinks is the more dangerous: the "unserious" propaganda you can spot and immediately discount as faux-news/entertainment, or the "serious" propaganda you can't.

--Adam

(To reply, click here.)






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