Markus Ettinger · 1918
Markus Ettinger’s wartime pamphlet argues that the fiscal crisis of the coming peace cannot be solved by a crude, one-time capital levy. Such a policy would mistake inflationary paper valuations for real wealth, drain productive funds from firms, and intensify capitalist concentration. Against this, Ettinger proposes a more discriminating program: tax the “virtual” increase of wealth created by war conditions and finance the transition through a general compulsory loan.
The argument begins with a critique of monetary appearances. Ettinger insists that wartime prices and balance-sheet values do not transparently reveal real enrichment or sacrifice. Inflation, scarcity, public borrowing, and abnormal demand have produced nominal gains that may not correspond to greater command over goods.
Die Begriffsverwirrung entsteht nur aus dem Grunde, weil der Schleier der Geldwirtschaft den Blick für die wahren Verschiebungen im Besitze und die wirklichen Opfer des Krieges trübt.
English translation: The conceptual confusion arises solely because the veil of the monetary economy clouds one's view of the true shifts in property and the real sacrifices of the war.
This distinction between real and apparent wealth governs the whole pamphlet. Ettinger does not deny the need for extraordinary public revenue; he denies that the state can justly or efficiently seize “wealth” measured at a distorted wartime price level. A levy assessed under such conditions would distribute burdens arbitrarily, because assets differ in liquidity, valuation, and dependence on credit.
His criticism is also production-centered. A sudden wealth levy would not fall equally on all owners: firms with access to credit could replace withdrawn working capital, while weaker producers would be forced to sell, contract, or close. Thus a measure advertised as social justice might actually accelerate monopoly and reduce output during the fragile transition from war to peace.
Die eigentliche Vermögensabgabe würde eine enorme Beschleunigung des Konzentrationsprozesses bewirken.
English translation: A capital levy proper would bring about an enormous acceleration of the process of concentration.
Ettinger’s alternative is therefore not fiscal passivity but a more exact theory of taxable enrichment. The state must reclaim gains produced by wartime conjuncture, monetary depreciation, and exceptional scarcity, rather than attacking productive capital indiscriminately. In this sense, the tax on wealth increase becomes both a distributive and a macroeconomic necessity.
Die Vermögenszuwachssteuer ist nicht bloß ein Postulat der Gerechtigkeit, sondern der absoluten Notwendigkeit zur Verhütung einer weiteren Verschuldung des Staates nach Friedensschluß.
English translation: The tax on increases in wealth is not merely a postulate of justice, but of absolute necessity in order to prevent a further indebtedness of the state after the conclusion of peace.
The pamphlet’s monetary reasoning supports this conclusion. War loans may mobilize resources when unused labor and materials exist, but under scarcity they create purchasing claims without corresponding goods, raising prices and complicating postwar settlement. Ettinger is especially concerned that the state’s interest burden will dominate the future economy unless it is reorganized in a way that preserves production while absorbing excess claims.
The closing program combines fiscal realism with social reform. Ettinger rejects the “actual” wealth levy because it would punish illiquid and productive property while favoring stronger concentrations of capital. He instead calls for taxing virtual wealth growth and imposing a general forced loan at a fixed interest rate to carry the transition economy.
Ich resumiere daher hier nochmals: Es kommt nur eine Wegsteuerung des virtuellen Vermögenszuwachses und eine allgemeine Zwangsanleihe mit 4 prozentigem Zinsfuß für die Abbindung der Zinsenlast und das Durchhalten der Uebergangswirtschaft in Betracht.
English translation: I therefore summarize once more: only a skimming-off of the virtual increase in wealth, together with a general compulsory loan at a 4 percent interest rate, can be considered for containing the burden of interest and seeing the transitional economy through.
The work’s significance lies in its insistence that postwar fiscal justice must be tied to monetary analysis and the structure of production. Ettinger’s “social future state” requires revenue, but not by confusing nominal valuation with real wealth or by weakening the producers needed for reconstruction.
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