Monday, August 20, 2012

Creating New Wealth by Taxing Net Wealth


The great Harvard Psychologist, B. F. Skinner taught us that incentives (“contingencies of reinforcement”) may take the form of positive reinforcement, negative reinforcement or punishment. In taxes we often equate all tax expenditures (loopholes, deductions, credits, exemptions, special rates, etc.) with positive reinforcement because they reduce the tax burden. The Supreme Court has taught us that the Affordable Care Act health insurance penalty is really a tax. It is perhaps better understood as negative reinforcement which shapes behavior by reducing the threat or application of punishment. more

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