The "Buy Some Local Crap" Tax - Scott Adam's Blog

The “Buy Some Local Crap” Tax

The only way to pay the government’s ballooning bills and reduce the budget deficit during an economic downturn is to tax the bejeezus out of the rich. The alternative is to borrow more money, thus making things worse. Realistically, cutting government spending is a worthy goal, but it won’t get us where we need to be. So I have a suggestion. It’s impractical, of course, but you wouldn’t be reading this blog if you didn’t enjoy noodling about impractical ideas.

Suppose the government passes a law requiring all relatively wealthy people, defined in some practical way, to buy extra crap they don’t need from local providers. The relatively wealthy could dine out more often, buy some extra shirts, get a flat screen TV for the garage, whatever.

The result would be a stimulus to the economy that would lift all boats and fill the government coffers. The relatively wealthy wouldn’t feel so bad about this form of tax because at least they end up with more shirts and flat screen TVs. This is the same principle as the $600 tax rebates, in terms of fiscal stimulus. But it wouldn’t increase the deficit.

I know, I know, you will point out that our shirts and TVs are made overseas. But the local merchants get their markups, and that helps.

The best part of this clearly impractical plan is that the rich would have lots of options on how to spend their money. There is a lot of science supporting the idea that having freedom of choice is essential to happiness. I would be happier spending $100 on two shirts I don’t need versus paying $50 in taxes and having no control over how it is spent. Everyone wins.

The hard part is figuring out how to measure this “extra” spending compared to the baseline, so you can be sure the relatively wealthy are complying. So perhaps it needs to be voluntary, like recycling.

I can imagine a new sort of credit card that is used only for the “extra” purchases, provided by the usual banks and credit card firms, but with one important feature: Everything you use the card for is public record, on the Internet.

I am convinced that the main reason people comply with recycling is that their neighbors can see who is being a good citizen on trash day. Peer pressure is important.

Obviously you wouldn’t use the special credit card for beer and condoms, because the neighbors would be watching, or could be. I think this would induce people to buy harmless additional consumer items, or take extra domestic vacations, or buy extra birthday presents for friends.

Yes, this idea isn’t practical. But how are the other plans looking?