Normally, I and others like to refer to neoclassical economics (NCE) as a “steaming heap of crap — frustratingly filled with untested assumptions, magical leaps in logic and completely unfounded conclusions — that universities are still dumping all over their students to indoctrinate them and inoculate them against logic, science and critical thought.” However, one of the more coherent aspects of NCE macro theory strongly recommends progressive taxation: the theory of marginal propensity, or consumption function. Here’s why:
Any taxation regimen is a redistributive process. The important questions are
- Who gets the money? and
- What they tend to do with it once they have it?