freedomdwarf1 -> RE: General Ideas for a Tax System (5/22/2013 8:09:47 AM)
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You are making some really HUGE assumptions that, for me (and probably many others), don't seem to be as you might like them to be. quote:
ORIGINAL: SpanishMatMaster First we have the fact that those companies are winning more money from other sources - taxes they are no longer paying. According to your logic, that would mean that they would drop their bills to the customers too. Or the companies always just raise the bills and never again drop them when the costs decrease? Really? In Germany they do, it is a result of free market and competence. I don't hear that opinion and it wouldn't fit most ecenomics in most countries. Quite simply, people and companies are in business to make money and profit. They want to make as much profit as possible with minimal effort - that's modern economics. If the price of some expense in production is reduced, they WOULD NOT reduce the price of the final product to the consumer in general. The extra money/profit gained by saving on the cost of production would go into the investment/expansion of the company or pay the CEO's and managers a higher wage/dividend. The cost of the product would remain the same (or very nearly) for the consumer unless a competitor's pricing strategy is such that they are losing revenue to the rival company. It is foolhardy to assume or think that a reduction in production costs would automatically lead to reduction in the cost of the final product to the consumer. No business in the world thinks along the lines of a charity. quote:
ORIGINAL: SpanishMatMaster Second, we have these companies in competence with themselves. They have means of production which emmit more, and less, CO2. Now they have a powerful incentive to invest in the ones which emmit less. You really think so?? How naive of you. All of these carbon and emmissions taxes are able to be offset by buying and selling them to other companies. Apart from which, the more you tax the company the more they will offset that cost by adding it to the final price of the product to the consumer in order to maintain their profit margins. To think any different means that you have no idea on how commerce and industry works in the real world. quote:
ORIGINAL: SpanishMatMaster Third, even if they all decide to raise the prices in coordination... by the way, this is forbidden in Germany... they would just create a huge incentive for any newcomer who can live with less profit: they come in, prices sink again. Raising prices in Germany is not forbidden at all. Germany is no different to most other first-world economies. If companies cannot make enough profits for their owners and shareholders they simply stop trading. You will have noticed that in recent years. That is why Germany's trade figures are not too bright in recent years - the government cannot raise enough income to pay for its national debt. The most recent growth figures (March 2013) show that it was barely 0.1%. quote:
ORIGINAL: SpanishMatMaster Fourth, the consumer is being motivated on consuming less. Usually he can, but even when he can't, this is only a motivation for the technological development to make it possible. Again, a very naive view of things. Consumers will consume as much as they are able to afford. quote:
ORIGINAL: SpanishMatMaster Fifth, there may be companies offering the same product without emmitting CO2 at all. I find that assumption highly unlikely. quote:
ORIGINAL: SpanishMatMaster So... you are supposing, as DesideriScuri, an inlelastic monopoly (he... now it is me with the economic gibberish) where the demand can never drop so much that the company looses by rising the prices. And this is simply not real. At least not in nothing we produce emitting CO2, AFAIK, and not in a free market. And particularly not in the energy production in Germany. And not only are you supposing an inelastic monopoly... you are also ignoring the other side of the medal! You are only considering the rise of taxes, not the drop. Taxes very rarely drop. If they do, it is either by such a small amount as to be negligable or would only benefit those that can already afford to pay the taxes in the first place. It is rarely of benefit to most of the community. Your response here clearly shows that you have a very naive and utopian view of business. quote:
ORIGINAL: SpanishMatMaster Not surprising that in "this the worst of all possible worlds" seeing "only the void half of the glass" my idea sounds horrible. Every idea would sound horrible in this situation. For all these reasons, and I think that they are many many good reasons, I do not believe in your scenario. Perhaps you should get your head out of cloud 9 and get to grips with reality. Your scenario is completely unworkable and unsustainable. Centuries ago, they tried something similar with a window tax. The bigger or more windows you had, you paid more tax. What did people do? They boarded up the windows so no tax was payable. That revenue stream just died a death and was never reinstated.
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