Friday, February 10, 2012

Choose Your Taxes

Research where subjects reported greater feelings of happiness if they gave money away rather than spent it on themselves, combined with that about how we respond to the perceived fairness of transactions, got me thinking that the impersonal nature of our social systems squanders the good feelings that come from our evolved altruistic tendencies. One idea to try and take advantage of this would be to allow a taxpayer to choose which part of the government his money goes to support. He can't choose the amount, just to what areas the funds go. To support unpopular government functions, a multiplier can be set so that money counts for more towards the amount you must give when you donate to them. Obviously the overall tax rate would need to account for this, but the popularity of the various departments will be fairly well established quickly. This approach would also require government departments to do a better job justifying their existence, which would help with taxpayer education and encourage transparency. If it could be made to work, the resentment taxes cause might be considerably reduced, being much more similar to the experience of donating to charity. It makes me think of the old system of police patrolling where cops would have a beat and they'd get to know the people living along it, which seems like a good example of a more personal approach to government services.

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