So we sit down with the kids to play Monopoly. The idea is to win by owning the most property and driving everyone else into bankruptcy. Everyone starts out equal and each time around the board we earn $200. The dice add randomness while landing on Chance or Community Chest may boost your chances or land you in jail. That’s the basic idea and it's fun so far.
As the game progresses players buy more properties, then add homes, then hotels, and rent goes up. In other words the cost of living goes up. And up. But wages (that $200, remember) do not go up. Therein lies the rub, with stagnant wages and higher costs the least skillful or least lucky players can't keep up and they go broke and eventually one player is left with all the goodies.
In Monopoly the last man standing is called the winner and the game is over. Put the pieces back in the box. But real life isn't so easy and the only way to start over is called revolution, a nasty road indeed. Short of revolution the real life players may be out of money but life goes on, round and round the board, earning a little and paying a lot. When they land on a property they sleep in the street. They are “losers” and we've been taught disdain for losers. But what about that other guy, the rich guy with gobs of homes and hotels? With no money in circulation the properties sit empty meanwhile upkeep on those dwellings drain the rich guy. He is not a winner, he's just a player stuck with property he cannot sell. And given enough time he lands on the bread lines too.
We've been taught that rich people are winners and the rest of us are losers but in the end we're all on the losing end of the stick. If you were more skillful and quicker and luckier you could be the one left with all those empty properties but you'd still be a loser – just slightly delayed.
The first missing ingredient in Monopoly is taxation. There are no taxes, money only flows one way out of the bank (government) and one way into the pockets of the rich. With nothing flowing in, the bank will eventually run out of money and those $200 paydays will end. And with all the money held by the top 1% the scheme collapses with a whimper not a bang. The alternative to taxation is printing more and more money but experience teaches that it never ends well.
So, the obvious question is how much taxation and what sort of taxation will keep society going? The board game isn't supposed to keep going but hopefully real life is and keeping the money moving must be part of the answer. It is easy to say that the rich should pay more, or everyone should pay the same, or some other scheme, but my quest here is an attempt to determine what taxation would keep the most people from sleeping in the street.
Get off your butt and work harder some will say and it makes a lot of sense, a society of moochers wouldn't make a good board game either. But in Monopoly the “work” is throwing the dice when it's your turn. Anyone who doesn't work is automatically dropped from the game. In the real world every able person should work too, but again the wages must be equitable. Everyone can't survive by mowing each other's lawn.
Taxation in real life is so complex any discussion quickly gets tangled in the weeds and that's why I think Monopoly is a good vehicle to consider alternatives.
First, it seems obvious to me that income must somehow keep up with the cost of living, not because I'm a bleeding heart liberal but because otherwise the system collapses. Collapses on the rich as well as the poor. Keeping income and cost of living equal might come from controlling prices, or from transferring money from the rich back to the poor, or some combination of the two.
Price control seems to be a loser in my view. I'd welcome comments to the contrary.
If prices cannot be controlled the other side of the equation is income. Income from labor (in Monopoly throwing the dice is labor), or from investments (those railroads and houses and hotels), or from cash transfers i.e. welfare. If the $200 could be increased as the game progresses to keep up with cost of living then players could continue to move around the board. The problem with increasing the minimum wage is the simple fact that those with the most hotels continue to accumulate reserves of cash and eventually either the bank runs out of money or it has to print more. Thus the obvious alternative, taxation.
Raising taxes from the poor to pay the poor just can't work, can it? I don't think so, the taxes must come from those who have above average wealth. Income tax might work if it were progressive, or perhaps an easier way is to tax on the basis of wealth. Each time around the board tax is paid on net worth at a progressive rate of x percent on the first tier of worth, a higher y percent on the next tier, and so on. Then the money would be available for an increased minimum wage equal to the cost of traveling around the board. Of course such a scheme would not work for a board game that takes a limited time and needs a winner. But a successful real world society must allow everyone to live long and prosper or at least live well enough to sleep in a bed and keep the kids fed.
There will be those with wealth and those with less, it will always be thus, but an America with the top one-tenth of one percent holding 40% of the wealth cannot be called a successful economy, can it? Let's fix it!