Don’t squeeze the rich too much

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Don’t squeeze the rich too much

I had an epiphany while reading the Annals of King Jeongjo. The history of humanity does not progress. It is just repeating itself.

Joseon spent an enormous amount of money to offer hospitality to the ministers of Qing China. The reception included performances, known as narye, which required considerable money and manpower. But the government made the wealthy pay for the expense. Of course, the high-ranking officials and aristocrats did not open their wallets. They collected money from wealthy merchants under various pretexts.

On Oct. 9, 1784, King Jeongjo issued a royal order: “When the royal court receives guests from China and gives a banquet, the government agency in charge of the festivity asks for contributions from rich households. Moreover, when preparing the timber to build a makeshift stage, the staff has troubled the people. This must be prohibited. Forcibly taking away the property of the wealthy should also be banned.”

This reminded me of the taxes demanded of businesses and the controversial “wealth tax.” It is justifiable that companies give back to society through donations and that those who make more money pay more tax. Furthermore, as income polarization has become a global trend and the middle class has become squeezed, charitable giving has become a requirement, not an option, for the rich to maintain their wealth.

But a tax hike should be the last resort for raising revenue. It should not be an emotional punishment taken against the rich. Excessive tax increases undermine the motivation of the rich, and when the total size of the economy shrinks, it is the poor who suffer the most. That’s why we are wary of the populism behind the voices shouting to raise taxes on the rich. The priority is to prevent tax money from being wasted and pursue a comprehensive program of tax reform.

The rich merchants of the Joseon Dynasty put up with the tax collection scheme because they enjoyed kickbacks in the end. But if there had been a fair tax scheme to begin with, the court of Joseon would have had enough without the rich merchants’ contributions.

In his controversial book, “The Fable of the Bees,” Bernard Mandeville wrote, “a whole nation ought never to trust to any honesty, but what is built upon necessity; for unhappy is the people, and their constitution will be ever precarious, whose welfare must depend upon the virtues and consciences of ministers and politicians.”

The writer is a culture and sports news editor of the JoongAng Ilbo.

by Lee Hoon-beom

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