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Taxation and Income Redistribution: Opposition Evaluation

Taxation refers to the methods of tax deduction in a country and the United States of America have a complex system of taxation with four different levels of tax collection. Income redistribution involves the transfer of wealth from one person to another. Uneven distribution of the amount of income earned by the individuals is corrected by implying income redistribution thus improving the effectiveness of the market economy of the country. The principle of income redistribution is done commonly through various taxation schemes as designed by the governments. By taxation, the individuals are required to pay the government an amount that is calculated depending upon their income. The policy behind the idea of income redistribution and taxation is to avoid formation of extremities like unjust accumulation of income on some group of individuals and unjust poverty on the other. In most industrial democracies income redistribution trend is directly related to the inequality in income; i.e. more the inequality, less the redistribution.

Most democracies employ income redistribution and taxation policies in their country for the economic equalization of their citizens. A widely used method for income redistribution in these countries is the employment of progressive income taxes. Different countries have different policies of income tax and income redistribution. “The United States has “the highest [income] inequality by far in our history and among advanced nations,” says Lawrence Mishel, president of the Economic Policy Institute in Washington.” (Francis, 2009, para.7).

The United States of America have a complex system of taxation with four different levels of tax collection. “The concept of redistribution can be characterized in terms of four parameters:

  • The subjects, such as individual persons or rigidly and non-rigidly defined groups whose holdings of goods are modified through the redistribution;
  • The baseline, the initial distribution of goods to which some other distribution is seen as a redistributive modification;
  • The social mechanism, such as a change in tax laws, monetary policies, or tort law, that engenders the redistribution of goods among these subjects;
  • The goods, such as income and property (or perhaps opportunities and liberties), that are redistributed through this mechanism.” (Redistribution: Distributive justice and redistribution, 2004, para.7).

In the United States, the main support and opposition for the income redistribution are the Democratic Party and the Republican Party respectively. The Democrats support income redistribution was as the Republicans are generally against the idea of income redistribution for attaining income equality among the citizens. The Democrats and the Republicans are the two most prominent divisions of the American political front. These two parties divide the American citizens to roughly equal divisions – citizens believing in either the liberal Democratic theories or the conservative Republican principles.

The Democratic Party with a history of 200 years in America preaches a liberalised way of democracy. “Democrats generally follow what is called a liberal philosophy, believing that the proper role of the government is to regulate and oversee the economy.” (Parla, n.d., p.2). They strongly believe in redistribution of the income for economical equality and justification. They underpin that the government should ensure that all citizens are receiving equal provisions for food, security, health care, educational opportunities and social security. The underlying principle in debating for income redistribution is that the poor, backward families of the country should also get all provisions as a rich family. They believe that the rich members have an obligation to help the poor and needy members of the society. An equal distribution of income decreases the unfair exploitation of the poor by the rich for their economic benefit.

A major argument is that the income redistribution provided equal opportunities for all class of people to attain better standard of living, thus economically benefiting the country by producing more consumers. The progressive tax structure is supported by the Democrats which lead to better economic equality. Social service is the main argument of the Democrats to support for their stand on high taxes and income redistribution. The Democrats argue spending more money for social services like improved health care and other welfare programs that spending it on increasing the military strength of the country. They believe that income equality can generate a highly cultured population with a more productive labor group. All these can increase the net benefits of the country than the ones produced by lower taxes or slashing social services. The latest move by the Democrats on income redistribution is taken by the present democrat President Barack Obama by proposing a new budget redistribution for avoiding income inequality. “That would cut the income for the top 1 percent an average of $64,000 per household, to a bit more than $2 million by 2012, the Tax Foundation study found. The Obama budget does make for “more even distribution of the economic pie,” the study concluded.” (Francis, 2009, para.9).

The Republicans on the other hand are a group of people who believe in a more conservative philosophy. “The Republican Party is based on the principles of personal responsibility, that individuals determine how they want to live their life, and should be allowed to succeed or fail based upon their own merits without government interference.” (Parla, n.d., p.2). The major opposition put up by the Republicans is that income redistribution is synonymous to theft. They argue that the income earned by an individual through legitimate methods are the sole property of the individual and is not to be shared by the government. The Republicans argue that high taxation benefits only the rich with more political influence and not the poor directly.

Another major argument in opposing income redistribution is that since the rich supply more capital to the country, they directly help in the economic growth of the country. The rich will spend more for the benefit of security and military of the country than the middle class section who do not have much to protect. “Based on data from 12 developed nations from 1905 to 2000, the study finds that a one percentage point rise in the income share of the top 1 percent is associated with a “statistically significant” 0.12 percent average rise in the growth rate of national output.” (Francis, 2009, para.14). The Republican Presidents have all advocated for tax cuts and it was President Ronald Reagan’s tax cut methods in the 1980’s that have helped America to overcome the huge economic recession of the early 1980s. “Republicans remain true to their core belief that the best conditions for job opportunity and economic growth come from individual freedom, limited government, low taxes and spending.” (Parla, n.d., p.4).

The opposition is taking a stand of low tax rates based on public opinions and general agreement. However, the Democrats also have their support of the public on their policies on income redistribution. In the case of income redistribution, both the groups conduct a healthy debate for the national interest, in order to improve the culture and living standards of its people. Elitism cannot be considered a major perspective for income redistribution as it affects all the classes of the society. However the Republican ideal of low taxes and opposing the income redistribution support the rich class of the society.

An ideal stand for this debate would be to allow tax schemes for betterment of the society by employing low taxes. The taxes collected should benefit all classes of the society. Also income redistribution is not the single method for attaining economic equality. The government should consider increasing the minimum wages and provision of better work conditions for income equality. The middle class should not be taxed heavily for the redistribution of wealth.


Francis, D R. (2009). Rebuilding the economy: Economic scene: Obama takes first step to redistribute wealth. The Christian Science Monitor. Web.

Parla, K.. (n.d.). Democratic versus republican perspectives: Key issues. 4. 2009. Web.

Parla, K.. (n.d.). Democratic versus republican perspectives: Principles. 2. 2009. Web.

Redistribution: Distributive justice and redistribution. (2004). Stanford Encyclopaedia of Philosophy. Web.


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