Regressive taxes

I doubt banks rank highly on companies that consumers love to death, but one reason I really dislike banks is their use of all sorts of insidious hidden charges to turn a profit on consumers. What's worse is that most of these penalties are regressive taxes.

As this article notes, overdraft fees for checking accounts can quickly add up. Banks don't work hard to keep you from the mistakes that trigger these fees, but often banks will waive these fees if you keep a lot of money with them. Thus these taxes tend to be regressive in nature, hitting lower income people the most.

I dislike state lotteries for the same reason: the people who tend to play are poorer and uneducated. Say what you will about paternalism, but I don't respect companies that build their business on regressive taxes.

Say what you will about Twitter's recent moves, but if the tax they're going to impose on their users is advertising, at least it's one that seems to cost the users who can afford it the most. Look at the composition of those who ponied up $50 for an account or $20 for a license for Tweetbot for Mac. They're largely early adopter tech geeks with enough disposable income to choose to opt out of Twitter's taxes on their user experience. Most other people are happy to pay with their attention and subject themselves to a more constrained set of options to use Twitter rather than pay with cash.

Personally, I hate ads, and much of advertising can cynically prey on human weaknesses in ways that are purposefully detrimental to their well-being. But tech geeks can be overly hard on ad-supported businesses in a way that shows a callous disregard for the consumer surplus that so many of them bring massive user bases. By the very nature of ad-supported businesses, they generally help much larger groups of users than paid businesses.

Some of the Zynga games, like Farmville, seem to skirt dangerously close to being regressive taxes. Free to play, they attract many users who wouldn't pay for a game up front. After the players are trapped, the game starts offering up enticements that cost money. And even if you don't pay up for those, you have to pay with hours of your attention. Enjoyable hours, perhaps, but when I hear about people waking up in the middle of the night to milk virtual cows, or whatever it is people do in those games, alarm bells go off over who is paying what price.

[Somewhat related: in sports, many have made very reasonable arguments for legalizing the use of the safest performance enhancing substances. After all, the cost of hunting down retired athletes like Bonds, Clemens, and Armstrong cost over a hundred million dollars of taxpayer money, and the social benefit of them was arguable. But one argument for continuing to keep those substances out of sports is their super high cost. If they are essential to winning in sports, and with the lottery-like payouts inherent to many of them, allowing them just shuts lower income folk out of competing at the highest levels. Being a professional athlete is expensive enough as it is.]

One very simple way we tech geeks can do some social good is by assessing the social impact of the products and services we use. You generally don't see that dimension considered in any of the traditional review of tech products from the Mossbergs and Pogues and everyone else (myself included) because we're so accustomed to measuring them on dimensions like speed, resolution, usability, and things like that.

The desire to do good and the profit imperative are uneasy bedfellows.