The case for a wealth tax in Canada

Enclosed is an excerpt from The Canadian Manifesto, my blueprint for a bolder, brighter Canadian future. You can purchase your copy through Amazon, by following this link: https://www.amazon.ca/Canadian-Manifesto-Conrad-Black/dp/1999439554

Canada has little chance and, for that matter, no ambition to distinguish itself in the traditional manner of great nations — by exercise of economic or military supremacy. That need not doom us to irrelevance. Rather, we can forge a unique and eminent role for ourselves in the world by building on our historic strengths in the arts of government.

Western liberal democracy has stalled. It is stuck in a sterile left-right tug-of-war, a fetid echo chamber resonating with shibboleths and platitudes. It is desperate for a way forward and Canada — peaceful, orderly, and affluent — is uniquely positioned to help. We can transform ourselves into a controlled and sensible public policy laboratory, solve the developed world's most intractable problems, and lead it to its next stage of development.

Poverty would be a fine place to start. A strong and original line of attack on poverty would be for the federal government to institute a small and self-shrinking wealth tax. People of net worth exceeding $10 million (and some leeway would have to be allowed to value nonliquid assets fairly conservatively), would pay two per cent of that total, or $200,000 in this case. The rate of tax would gradually escalate to a maximum of five per cent on an individual net worth of $250 million or more, or $12.5 million.

The funds raised in this manner would not go into Ottawa's coffers. They would be credited against the regular income tax of the wealthy to fund their own projects of authentic poverty reduction, preferably through employment or a program to assist the poor to become gainfully employable. The legitimacy of these projects would be supervised in the same manner in which charities and foundations are governed now.

As poverty, by preestablished definition, is reduced, the wealth tax in all brackets would decline correspondingly. Obviously, this would give society's wealthiest people an incentive to produce an effective poverty-reduction program. There would be an additional incentive for the taxpayers in that philanthropic munificence is always attended by recognition and prestige.

In this manner, the process of taking money from those who have earned it and transferring it to those who have not in exchange for their votes would be replaced by a variously incentivized system of joint self-help: the wealthy assist the poor to cease to be poor, and the poor respond to the opportunities afforded them, which automatically reduces the surcharge on the rich, who would be benefitting already from reduced income tax rates and increased consumption taxes, which can be avoided by the frugal with no danger of being accused of evasion.

Such a scheme would give the most commercially and financially astute people in society a vested interest in the elimination of poverty. It would exactly align the interests of the wealthiest and the poorest people in Canada, and have the additional benefit of reducing the friction between economic echelons of society.

This is a much more effective way of uniting society behind the goal of poverty reduction than an expanded and unconditional, impersonal, and statistically based dole to the poor, while riveting heavy income taxes on the wealthy, who have the resources to make excessively confiscatory taxes increasingly difficult and expensive to collect (as well as the ability to source part of their income abroad).

It would also be a much more efficient, productive, and self-strengthening tax system than the long-standing tug-of-war between the redistributors and the supply-side advocates of prosperity through economic growth, derided by its critics as "trickle-down economics." And this really would be original to Canada, not another copycat acceptance of what the Western liberal death-wish processes in other countries through the sausage factory of dumb, stale, and unworkable ideas.

Once we show the world how to manage properly poverty and wealth inequality, we can move on to produce a better balance of health care costs and outcomes, to build the world's best educational system, and otherwise elaborate policies and structures of government and society that the rest of the world will admire and emulate. Perhaps alone in the world, we have the opportunity and the ingenuity to do it.