NOTE. THE AUTOMATIC ADJUSTMENT OF INCOMES.

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This—the great financial measure of the future—can hardly be expected to commend itself to the philosophic economists of the present day. It is the penalty which every man who is before his time must expect to pay for his excessive sagacity, that his contemporaries neglect or deride him. Accordingly the very name of the French thinker who suggested this beautiful scheme for ensuring Liberty, Equality, and Fraternity has been forgotten and—will it be believed?—the number of those who have ever taken the trouble to work out his formula is quite disgracefully small.

The Formula of the great unknown stands thus:—

·0001 (x - m)² = The amount which the state deals with in all incomes above £100 a year.8

Here x = the income. m = £1,000.

In working out this Formula, the Rule may be stated as follows:—

1. From the number of pounds of income (x) deduct 1,000.

2. Multiply the remainder into itself, i.e., square it.

3. Divide the product by 10,000.

The result will give—

(i) The amount paid by the State to the owners of income under £1,000 a year.

(ii) The amount paid to the State by owners of income above £1,000 a year.

Examples:—

(a) Income of £200 a year; i.e., x = 200.

200 - 1,000 = -800.
-800 squared; [i.e.,-800 multiplied by -800] = 640,000.

Result of 640,000/10,000 = 64.

Consolation income to all possessors of £200 a year ... £64.

(b) Income of £500 a year; i.e., x = 500.

500 - 1,000 = -500.
-500 squared; [i.e.,-500 multiplied by -500] = 250,000.

Result of 250,000/10,000 = 25.

Consolation income to all possessors of £500 a year ... £25.

(c) Income of £900 a year; i.e., x = 900.

900 - 1,000 = -100.
-100 squared; [i.e., -100 multiplied by -100] = 10,000.

Result of 10,000/10,000 = 1.

Consolation income to all possessors of £900 a year ... £1.

(d) Income of £1,000 a year; i.e., x = 1,000.

1,000 - 1,000 = 0.
0 multiplied by 0 = 0.

Consolation income to all possessors of £1,000 a year ... 0.

(e) Income of £2,000 a year; i.e., x = 2,000.

2,000 - 1,000 = 1,000.
1,000 squared [i.e., 1,000 multiplied by 1,000] = 1,000,000.

Result of 1,000,000/10,000 = 100.

Income tax paid by all possessors of £2,000 a year ... £100.

Reduced to a tabulated form it becomes evident that the consolation paid by the State to all owners of income below £1,000 will decrease as the incomes increase; until, when a prosperous gentleman attains to £1,000 a year, the consolation will disappear, and instead of receiving anything he will begin to pay tax upon his income, such tax becoming greater and greater as his income grows—until, if he be so rash as to attain an income of £11,000 a year, he will pay £10,000 a year income tax, and if he does not take this warning and rises to £12,000 a year the State will not only claim all his £12,000 but demand £100 a year more.

That is to say,

A.

Incomes of
£200 will receive from the State the Consolation of £64
300 49
400 36
500 25
600 16
700 9
800 4
900 1
1,000 Nil

B.

Incomes of
£2,000 will pay to the State a Tax of £100
3,000 400
4,000 900
5,000 1,600
6,000 2,500
7,000 3,600
8,000 4,900
9,000 6,400
10,000 8,100
11,000 10,000
12,000 12,100
* * * * *

The richest man in the community will thus be he who has an income of £6,000 a year; on this he will have to pay £2,500 income tax, leaving him with an available balance of £3,500 a year to spend! Now was not this anonymous Frenchman a man of real genius? And is he not a signal example of the truth that

“The world knows nothing of its greatest men”?
* * * * *

The assumptions on which this lofty attempt to reconstruct the social fabric are based are obvious. They are these:—

I.That the earners of daily or weekly wages are not owners of property, nor can they be classed among the possessors of a secure annual income. De minimis non curat lex. II.That it is to the advantage of the community to increase the number of small capitalists, and to assist them with State aid—though in a diminishing ratio as their property or incomes increase, and they need less and less encouragement.

III.That it is equally for the advantage of the community to decrease the number of large capitalists and to discourage the accumulation of wealth in few hands; and therefore it is necessary to fix a limit of wealth which men shall not be permitted to exceed.

Oh! ye Astors and Vanderbilts! Ye Rothschilds and Barings! Ye kings of railroads and bacon and nitre! Aye! and such as thou citizen Labouchere—thou of the morbidly sensitive conscience. Tremble, for your day is coming! The age of hap-hazard and empirical finance is passing—the age of scientific and philosophic readjustment is about to dawn. There are those whose mission it will be to set all things straight, and to bring peace on earth and goodwill to men by the exquisitely simple machinery of Fiscal Reform. When that time comes Mammon’s Kingdom will sink to be a mere tributary to the great pantisocracy of the future. Hoarding and accumulating will pass away and die—brought to an end by the phlebotomy of the scientists. Money-grubbing will be an incident in the historic romances of that happy time, and the tutored youth, young men and maidens, will smile at the darkness and fumbling stupidity of those untaught generations who only chattered of a golden age, with never a dream that a better age than that would come with the revolving years—to wit, the age of—

·0001 (x-m)².


                                                                                                                                                                                                                                                                                                           

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