Why is the Left so keen to tax the rich of today, which reduces investment, but through this concerns about sustainable development, not tax the rich of the next generation by leaving them a smaller capital stock?
Rawls proposes a principle of just savings. Rawls suggests that each generation puts itself in the place of the next, and asks what it could reasonably expect to receive.
Currently living people have a justice-based reason to save for future people only if such saving is necessary for allowing future people to reach the sufficientarian threshold as specified. This is known as the accumulation stage.
Once just institutions are securely established — this is known as the steady-state stage — justice does not require people to save for future people. Rawls also holds that, in that second stage, people ought to leave their descendants at least the equivalent of what they received from the previous generation.
Edmund Phelps developed a Golden Rule in the 1960s that suggests that it is possible to save and invest too much. Phelps also generated the result that the savings rate can be too high:
The basic significance of the golden rule is as a warning against national policies of over-saving or counterproductive austerity.
Utopia, you are standing in it! 
Recent Comments