Risk on margin, and the taxing of the gross versus the net - is a key deliberation before we construct global incentive debits and credits. Before we resort to the tax lever - I contend that there are numerous immediate actions we can take which have real impact - even up to 100% of the COM (2018) 773 goals -
The principal flaw which resides in simpleton thinking around taxes and universal income, revolves around the flow and apportionment of value, not currency. People regularly associate currency with value - of course because in a given context of economics, the two are coincident. But they are not congruent. If you are buying groceries and paying the rent, the two appear congruent. But if you are developing a nation's school system or roads, and have to finance that from the IMF or by issuing a bond against a sovereign guarantee listed on a Swiss Exchange, the two are not congruent at all. The difference between currency and value becomes a poignant issue.
This is what a value chain strategist learns through application (schools try and teach this as 'engineering or value economics'), and use to administer designs of markets and technologies. It proceeds according to this thought exercise.
The Gigantic Dividend
As King of Elbonia, a man commissions a project which will retrieve and park in orbit above his homeland, an asteroid with $700 quintillion in materials to be exploited. The King is ruler of Elbonia, and as royalty, bears the job of administering the economy alone. The asteroid is successfully retrieved and parked in a geosynchronous orbit under special space treaty which allows Elbonia Exclusive Free Trade Zone access to the asteroid - as long as it maintains its geosynchronous orbit position above their land.
The Elbonian King, being no dummy, begins to exploit first the platinum (bear this in mind), and then the gold. He then sells this gold to gold-hungry Russia and China. Russia's gold is held in private vaults (former KGB and now mafia heads) and China's gold is held by the Triads (Manchu intelligence agency and Cantonese mafia). These entities are currency rich from exclusive programmed trade access, and pay full price gladly. Elbonia is making so much money that the King, rich beyond his wildest dreams, decides to offer a dividend to all his people. He pays for their healthcare first, then their pensioners, then their higher education, and because prices are beginning to rise for basics now, he says 'What the fuck, let's just give everyone in Elbonia, 250 kg of gold each year as a Dividend.' This equates to $11.75 million to each and every Elbonian, each year. It was called the AstroGold Dividend.
There were parties in the street. People drunk everywhere. Celebrations went on for days on end. The King was a hero. He goes on the lecture circuit to extol the virtues of 'socialized dividends'. He smacks 'capitalist' countries hard for their 'profit greed' and lack of attention to the poor. Pretty soon, no one in Elbonia had to work - they just hired Enkibonians to come into the country and do the hard work for them. Things went on like this, and eventually Elbonians quit going to college, or pursuing advanced literature or science, because - there was no real need to. Everyone had a yacht and a house and several cars. A sandwich cost $155. But no matter, there was plenty of money to go around. The rate of Diabetes grew to 70%, and the number one moving free prescription was Hydrocodone, equating to 8 tablets a day for every man woman and child in Elbonia (and btw, these last two bits are a real national strategy story....)
The rest of the world was plugging along as normal with a 56% suffering rate, and a 22% abject poverty rate. Elbonia was living the good life. Expensive, worthless, but good.
Soon, one of the hard working Enkibonians running the satellite control system had a thought. What if he just slipped a bit of leeway into the orbital controls system (AstroGold OCS) so that the asteroid would cycle back and forth over both Elbonia AND Enkibonia on an annual basis. Then, under the treaty, Enkibonia would get to exploit the gold ores for half the year, thereby becoming equally rich as the Elbonians. What a plan! They had plenty - it was time, the Enkibonians got their share too.
So the orbiting asteroid began to cycle back and forth over Elbonia and Enkibonia semi-annually and both nations become very rich. The Elbonians of course were coerced into allowing this, because of all their bragging about how wonderful sharing the wealth had been. Well, time to put up or shut up Elbo-heads. But this time... each nation could only give out half as much Gold in Dividend each year. Plus, oddly China and Russia each cut their orders for gold in half each year. They now wanted tantalum, technetium and vanadium - none of which were on the asteroid. But hey... at least they still paid 50% for the gold. Everyone is still rich!! Yay! Take me to the marina Jeeves...
This pattern repeated itself until every single nation, was allowed a period of time with the asteroid right above it in geosynchronous orbit. Enkibonia and Elbonia had to walk-the-walk and not simply talk-the-talk each year - they were coerced into sharing the asteroid as well. Each person on Earth was eventually granted $47,019.51 (at today's price) annually as an AstroGold Dividend! Everyone on Earth could now buy a car, home and food!! (in the past)... but they forgot that little qualifier 'in the past'. Because value and currency are not congruent.
The problem was, no one wanted gold any more. There were no aliens around to make bids on it. No one wanted a currency based upon gold. No one wanted a currency at all. Everyone was up to their ears in gold and currency. Everyone was 'rich'. Eventually however, the asteroid was depleted to nothing, and the Kings all had to simply print certificates in lieu of the AstroGold, which read '$47,019.51 annual AstroGold dividend'. The problem with this was, things of value still had to be done. The trash had to be disposed of, and the food had to be trucked around. Water had to be made clean and sewage had to be carted somewhere. Those who pretended that shitting, hydration, healing injuries, reproduction, eating and shelter were all manifestations of 'the Elbonization of other cultures' - these idiots all died. And in order to avoid slavery (under the guise of 'volunteering'), the value workers had to be incentivized to do those basic human quality of life activities. They had to be offered substantially more than the $47,019.51 each year. No, there were not enough 'volunteers' to do all this. This caused all pricing to rise substantially. This is called a dilution-of-value inflationary condition, and it is rampant in developing nations. The case studies are ample.
A cup of coffee $450
Getting trash disposed in a landfill $12,500
A bottle of clean water $14,000
Sewage service to clean your village of disease causing human waste $1,500,000
Shelter from weather $13 - 45 million
The poverty level became $90,000 in annual income. Those who hoarded away the platinum from the asteroid, they are still living on their yachts as they always did - and those holding gold, cannot afford even a meal each day - despite having $250,000 in the bank.
The rich got richer and held all the wealth in platiunum, the numbers of poor grew and stayed poor. Gold was worthless and the asteroid was now just a wonderful and inspiring image on a piece of paper (see above) - paper handed out by Kings fascinated with their own benevolence and compassion.*
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A TAX is nothing but this same process and principal, just on the debit side of the ledger. If you 'TAX to DIVIDEND' that is just doing it to yourself twice... twice as stupid. Doing the same thing - just pretending that you went and got an asteroid... yet in reality just stole the money from the population instead.
The key: A nation's wealth is in the VALUE created by its creative and working classes. Not in a currency, tax, material, dividend, nor amount. And unless you have an AstroGold asteroid parked above your nation exclusively (which Saudi Arabia, Sweden, Australia, Brazil, Qatar, Kuwait, Venezeula, etc do...) - your population
must provide value... or be poor. Deceiving your people into thinking that this law can be escaped through magic tricks and rhetoric, is not wise at all. And if you do have a gold/oil/mineral asteroid parked above your nation, moralizing about 'social dividends' to other nations who provide the value and creative work (used to be measured in a thing called 'real productivity')... is not wise. The world might ask your people to start paying their fair share.
This law is inescapable and knows every trick in the book...
For every flow of a unit of currency margin, an equal and opposite flow in provision of value or undertaking of risk must also be provided.
(* Note: since the source of compassion and virtue was so righteous and vital to humanity, this mandated that all Kings be the only entities who could hold platinum - in order to ensure that their virtue-flow was not compromised by economic fluctuations. The source of compassion must be protected at all costs - even to the point of ordering a nuclear strike, if necessary.)