Decem: Financial Alternatives for Development Aid (7)

Written on September 6, 2007 by Max Oliva in Development

J.Pozuelo-Monfort, MPA candidate at Columbia University
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Luxury has existed for ages. Luxury allows for differentiation, grants status, and deserves the pride of its owner, in expense of what others think, in expense of others’ admiration or scorn, others who will see luxury as an object of desire or an innecesary complement in a society where there are alternatives valued at their fair price.
An economically unequal society that spans a variety of purchasing powers allowing for the existence of a makret economy in which product specialization, added value, and customer service overlap to offer the consumer a product tailored to his needs and income.
The welfare state requires taxation to cope with public spending that confers universal access to education and healthcare, that homogenizes a society with different levels of skills and therefore compensation, and enables to hedge against an individual’s risk of disgrace, an individual that feels reassured in a solidary system based upon redistribution. A redistribution once upon a time bound to the borders of the nation-state, that has matured towads an intercontinental model in the postwar Marshall plan, or intracontinental in the European Union of today. A redistribution which dynamics must face the challenges of globalisation and convert into a global model.
The basis of the concept of redistribution is, as a result, taxation, taxation on wealth and income, taxation on purchased products and services through a tax widely known as value added tax.
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