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Val comments on Is Pragmatarianism (Tax Choice) Less Wrong? - Less Wrong Discussion

-16 Post author: Xerographica 12 February 2015 04:47AM

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Tags: evolution progress hand invisible finance public economics pragmatarianism

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Comment author: Val 14 February 2015 01:26:05AM *  1 point [-]

Do us all a favor and come up with a decent explanation for why we should trust your words (votes) rather than your actions (spending).

It's simple. The representatives don't micromanage our daily life, they only work on laws within the confines of a constitution. Have you heard about the separation of powers? They can also make only minor, gradual changes to the existing system without risking a revolution.

On the other hand, a completely free-choice taxation system would bring a lot of instability into the system. How could your economy follow drastic changes in the tax allocation, which will inevitably happen as people's moods are changing. For example, the school system would get one year 150 billion $, the next year 17 billion $, the third year 200 billion $. How could you plan ahead in such a chaos?

Another question is, how would you introduce such a system, assuming it worked? Just come up one year with it, and when people get to fill their tax forms, they will be surprised by a long form where they will need to specify where they are allocating they taxes to? Do you really expect that it will be at least a little similar to how the allocation was last year? Because otherwise the system couldn't handle the large differences. Do you expect that everyone would know by heart how much the upkeep of certain institutions costs? Do you expect every citizen to become a financial expert and know what to allocate where to stop some essential services form completely collapsing because they received only a tiny percentage compared to what they got last year?

You came up with a lot of theory without any proof how it would work in practice, so please, show us a plausible scenario with concrete examples how you thing your ideas would be implemented.

You also didn't answer my original question: to what extent would the choice extend? Completely free? So if no one allocated to the police (because they hate receiving speeding tickets) then would the whole police just disband? The more I think about your proposal, the closer it looks to anarchy.

If not completely free, then what would be the limits?

Comment author: Xerographica 14 February 2015 10:14:53AM -2 points [-]

The entire point of pragmatarianism is that the supply of public goods should be determined by the demand for public goods. If the demand for public education is $150 million then that's how much public education should be supplied. If, the next year, the demand for public education dropped to $17 million then why in the world would you think it's ok to continue supplying $150 million dollars worth of public education?

In a pragmatarian system... that difference of $133 million dollars wouldn't just vanish or go back into the taxpayers pockets. If they didn't spend it on education then it's because they spent that $133 million dollars on other public goods. Why did they spend it on these other public goods? Evidently because they valued greater quantities of these other public goods more than they valued greater quantities of public education.

If you want to argue that taxpayers consistently make terrible value judgements... then why wouldn't you want to consistently apply your argument? Why wouldn't you also argue that farmers are going to make equally bad value judgements in the private sector? Why would you worry about public education being incorrectly supplied but not worry about food being incorrectly supplied?

In the private sector nothing prevents a farmer from gambling all his income away in Vegas. They have this option but most don't choose it. Instead, they spend most of their income on the inputs that they need to keep their farms operating.

In the public sector, however, these farmers wouldn't even have the option to gamble all their taxes away in Vegas. Yet, you're more worried about their value judgements in the public sector than you are about their value judgements in the private sector. Again, why are you inconsistently critiquing the value judgements of taxpayers?

Maybe it's because you're under the impression that farmers don't depend on any public inputs? Perhaps Elizabeth Warren can help clear this up for you...

There is nobody in this country who got rich on his own. Nobody. You built a factory out there—good for you! But I want to be clear. You moved your goods to market on the roads the rest of us paid for. You hired workers the rest of us paid to educate. You were safe in your factory because of police forces and fire forces that the rest of us paid for. You didn’t have to worry that maurauding bands would come and seize everything at your factory, and hire someone to protect against this, because of the work the rest of us did.

According to Elizabeth Warren, farmers and everybody else got rich because of public goods. And I absolutely agree with her. Here's where I fundamentally disagree with her...

  1. That Warren knows better than farmers do which inputs, public or private, they need more of to keep their business thriving.
  2. That Warren has more incentive than they do to get the most bang for their buck.

Warren lacks the knowledge and incentive of millions and millions of taxpayers yet you want her value judgements to replace the value judgements of taxpayers. If your motivation is the perception that you benefit more as a result of this replacement... then wouldn't you benefit even more if this replacement was extended to the private sector?

If you truly want more benefit... then allow taxpayers to have the influence that they've earned. Extending their knowledge and incentive to the public sector will benefit us all immensely.

This isn't to say that the value judgements of taxpayers are always going to be correct... but how could it not be important to know when they are incorrect? When disparities in valuations are readily apparent, this facilitates the exchange of information. "Hey buddy, why you running?" "There's zombies chasing me". If you notice that the DoD suddenly has a huge influx of funding... then you might want to figure out what other people know.

To learn how it would work check out the FAQ.

Yeah, if nobody allocated their taxes to the police then the police would disband. Again, maybe taxpayers know something that you don't. Is that so hard to imagine? It's really easy for me to imagine which is why I love the idea of incorporating all this info and incentive into the public sector.

I haven't heard a plausible argument for why it should be 1% allocation rather than 100%. Until I do then I'm going to argue for 100%. But this certainly doesn't mean that I won't celebrate a 1% step in the right direction. But if farmers truly needed training wheels then we would have all starved to death by now.

Comment author: Val 14 February 2015 01:22:38PM *  1 point [-]

People need time to learn a profession. At least a few years to learn it, and at least a decade to be good in it. You cannot expect tens of thousands of teachers to lose their jobs and retrain to become medics, just for them to have to retrain as policemen next year, because the allocation changed.

If the allocation in a certain sector dropped significantly, you argue that it just shows that demand dropped. But what to do with the thousands or maybe millions of people suddenly without a job?

If the allocation in a certain sector increased significantly, because demand suddenly soared, how would you get so many trained professionals for those jobs? You couldn't train them overnight.

Demand will fluctuate significantly, because people are emotional beings. For example, I've seen in a European country, that a party's votes dropped from over 50% to below 20% in a year because their leader was found out of doing something stupid. A completely new government was elected, but life went on with little changes, because they didn't drastically changed the tax allocation, the new government made just small changes. Had they completely eliminated the funds of a sector, people would have gone on strike or maybe started a revolution.

Now imagine what would happen if an image of a dying child circulated through the media, with a message that there isn't enough money for health-care. Next you know, that sector receives more then double the founding. How quickly you think you could train new staff for it? The same time a scandal breaks out because of a single teacher being found out that the abused a child. Tax allocation for education would drop significantly because of that single event, and now tens of thousands of teachers are without a job, and hundreds of thousands of pupils don't have a classroom to study in. Even if next year the situation is stabilized, hundreds of thousands of students missed a school year, and there would be a job opening for tens thousands of teachers: how could you fill these instantly before the beginning of the school year?

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