Plato's Laws V, 6

The rest of Book V wrestles with the problems we identified in the last two discussions, especially the ways in which what we call capitalism will distort the equality of the initial division. 

The Athenian suggests that, now, the state must decide on a system for handling property ownership. The best of all system, he claims, is that all shall be held in common and in conditions of friendship. This means not just property but everything: wives, children, nothing shall be thought of as properly belonging to anyone, but all as the common property and business of all. There is no real argument given for this being the best possible system because Plato had already argued for it in the Republic, where he admits that only the Guardians and Auxiliaries will be rational enough to see its value. Here the Athenian simply asserts that it is the best system, but admits that absolutely no one anywhere abides by it, so it probably won't be acceptable to this colony either.

No, people are going to want private property, and private relationships like spousal ones, and to parent their own children. So the problem becomes one of how to ensure that some sort of equality is maintained among the populace.

The Athenian proposes a whole series of anti-capitalist regulations meant to ensure that no one accumulates great wealth. Most important is a regulation that you shouldn't buy or sell your assigned land. It isn't actually forbidden, but anyone who does comes under religious censure and public curse. The idea here is not to provide you with a basis for profit, but with a permanent source of support and standing within a community that is meant to approximate human equality. 

People should not be able to own gold or silver, or currencies issued by other nations abroad; only the local currency should be possessed, as necessary to further local transactions or pay wages (note that slaves are expected to be paid wages). People who have business abroad may draw currency, once the government has approved their going abroad; but when they return, they need to hand in their foreign currency for a like amount of the local currency.

So they can profit, then, on their foreign trips? Yes, profit is allowed, and not just on foreign trips but by regular economic activity at home. However, there are to be limits placed on wealth acquisition. The initial value of the equal lot that everyone received is to be taken as a lower bound: no one should be allowed to fall below it, the Athenian says. presumably meaning that the state should provide new funds as necessary to those who do. 

This lower-bound value is also to be used as the basis for calculating the upper bound. The state is to divide society into classes based on those who have twice, three times, or four times the original value of the lottery distribution. These classes will be assigned different political powers, although so far we have not heard yet exactly how they will be differentially empowered. But what we do hear, now, is that the Athenian wants to limit the absolute upper limit of wealth at four times the initial lottery value. Everything one earns after that is to be handed over to the state.

There is a proof along the way that good men can't grow exceedingly rich, which is mathematical and logical rather than pragmatic. As such, it is subject to Aristotle's dictum (frequently cited here, because I take it to be one of the most important Aristotelian insights and a kind of proto-pragmatism) that proofs from strict logic cannot apply to worldly affairs. I am therefore inclined to dismiss it, but it is worth noting because it allows the Athenian to assume that anyone who has grown very rich is also not morally good.

Note that the upper bound is on wealth, not income. Once you have grown in wealth to four times the original amount you received at lottery, there is a 100% tax on all future income, which carries on forever until you lose enough to fall below the upper bound.

The Athenian also describes the division of the city, physically, into legal departments; here he makes the claim I mentioned earlier, which is that the capital should be at the center of the territory in order to ensure the closest thing to equality of access to the center of law and power. Equality is not going to be perfect -- the most outlying farms will be more distant that the inlying ones -- but that is also true for the wealth system. Some are going to be as much as four times richer than others, and you can rise or fall within limits on how much you can rise or fall. 

It's hard to imagine what a modern society would look like if it attempted to enforce a rule that one could be only four times as rich, in total wealth, as the poorest member of one's society. There are of course also big problems in terms of incentives to work that come from setting a permanent 100% tax on the most successfully productive of the citizenry; but that part, at least, doesn't bother the Athenian. He does not want the society to grow rich, he wants it to be good, and he thinks that excessive wealth concentration is opposed to both personal moral goodness and social stability.

A practical problem: what about the problem of mental health, so that "the poorest" may be incapable of maintaining anything like a reasonable personal standard of wealth? There are two answers to that, one of which is explicit and the other implicit. The implicit answer is that the wealth is not personal, but per household: if a household contains an incompetent member, they are meant to sort that our internally. The householder should be a competent family member, with incompetents to be cared for within the household. The explicit answer is, of course, that households that fall below the lower wealth threshold are to be supported by state resources until they are back at that threshold. 

The book closes ironically, with the Athenian admitting about this system exactly the same thing he admitted about the "everything in common system" -- no one does this, and probably no one would agree to it anyway. The legislator ends up admitting it to the public, and suggesting, "Look, this is just a model, we'll just try to approximate it and leave off the parts that prove impossible." So why did we run through these two systems that are so opposed to human nature that no one does and no one would adopt them? These are two views of human equality, both of which run up against human nature (as well, returning to Aristotle's point, as practical reality). The first one is perfectly equal; the second is only approximately equal; neither is obtainable, because equality is not what we really want.

Social stability is going to require some sort of equality, though. What kind, since neither true equality nor even approximate equality are acceptable to us?