General Discussion
In reply to the discussion: What does "abolish profit" mean? [View all]JackintheGreen
(2,036 posts)I cannot speak to the specific details of DSA's platform, but profit is what's left *after* you capitalize any income: pay yourself, pay your workers, pay your power/water/rent bills, resupply materials, invest in infrastructure improvements to increase or economize production, etc. Everything left is profit. This is the dividend that is divided among investors and, I assume, this is the leftover that DSA wants to eliminate.
As most DUers are aware, the top marginal tax rate for individuals after WWII was between 70-90%. The marginal rate is net taxable income after any deductions are removed from gross income. I am not a business tax guy and don't pretend to understand the ins and outs of corporate taxes, but an analogy I found useful to wrap my head around this was to think of the individual (or household) as the company/factory/etc. In REALLY simplistic terms, you have a sum of income coming in annually from your labor. Out of that you need to pay rent or mortgage, feed and clothe yourself and your family, pay somebody to carry your trash way, somebody else to bring you water and electricity (the power company), and all the other bits and bobs that make life livable. All of this would have not been taxed so that regular people can lead regular lives (or corporations, which like Soylent Green is people now). After all that is paid for, anything left would be the family profit subject to the marginal tax rate, and it often isn't a very big number.
Obviously, this is not how it works in the US anymore, and it hasn't since the 70s, certainly not since the 80s and St. Ronnie's Most Holy Grift. Socialist positions in general, but not necessarily the DSA specifically, don't want to deny income to live, or even a life with numerous creature comforts, but they want to minimize the gross profiteering enabled by the US tax code.
Put it another way: think Star Trek, especially Next Generation. Everybody has every comfort they could possibly want, to the point they can pursue their heart's desire without fear of not eating, or paying the bills, or affording medicine, etc. The mechanism is never defined, but "excess" money - that which is leftover after creature comforts are paid for, is folded back into the state treasury in order to enable to universal provision of those comforts.
That's the theory, anyway. Can any policy wonks chime in with corrections?