“The scarcity mindset reinforces that there’s never enough time, never enough money. And since we can never be sure about the future, we have to ration every last possible resource and grab every bit for ourselves. This ‘scarcity’ mindset pretty much sums up tax policy in most ‘rich’ Western nations.” S Black

Paul Krugman’s Worst Nightmare

Tallinn, Estonia ~  In the absurdly best-selling book The 7 Habits of Highly Effective People, author Stephen Covey wrote about abundance vs. scarcity.

With the abundance mindset, people confidently view the world as full of resources and opportunities… that there’s more than enough to share… and that more success is coming soon.

The opposite is the scarcity mindset, where people view everything as scarce and finite. If you’re winning it’s because I’m losing.

The scarcity mindset reinforces that there’s never enough time, never enough money. And since we can never be sure about the future, we have to ration every last possible resource and grab every bit for ourselves.

This ‘scarcity’ mindset pretty much sums up tax policy in most ‘rich’ Western nations.

In the US, tax revenue as a percentage of GDP has been almost exactly 17.7% of GDP since the end of World War II.

It hasn’t mattered how much they’ve raised tax rates; when tax rates go up, overall tax revenue, i.e. the government’s slice of the GDP pie, stays about the same.

For years they’ve been bleeding cash.

Yet rather than say “How can we support abundance? How can we help set the right conditions to make the PIE bigger,” they punish and intimidate everyone. Continue reading →