12/03/2012 01:38 pm ET Updated Dec 06, 2017

Chrystia Freeland: On the Self Tax and Democratic Government

Thomson Reuters Digital Editor Chrystia Freeland recently spoke with us about her new book, Plutocrats: The Rise of the New Global Super-Rich and the Fall of Everyone Else. In the first part of our three topic conversation, Freeland explains an idea she came across while doing interviews for her book called the "self tax."

This tax, according to millionaire Foster Friess, is a self imposed tax wealthy people undertake as a result of all of the philanthropic activity they participate in. Freeland spoke with many wealthy people who felt this self tax was "superior to regular taxes that are levied by the state" because individuals are always better at spending money than the government is. Freeland thinks this idea of the self tax can threaten the credibility and idea of the state that has power to impose taxation on its citizens. She also points to the idea of democratic government, which is "not about the self-tax," but about "us coming together and collectively filling up the kitty and collectively deciding what we as a society want to spend that money on."

Do you think individuals can spend money better than the government? Leave a comment below.