No: epistemologically, that is the indicator justifying a growing suspect.
Ineffectiveness should be determined by a logical and technical argument over the method, proposed as a possible solution, itself. You should identify what has it go wrong in practice. And you have in part already done it: that taxes are not earmarked (on compensation) and that the discouragement factor is insufficient. That is not necessary, it is not intrinsic to the method.
Nearby I commented on the infernal noise from electric cars. That is not necessary, not intrinsic: it just happens that people think it acceptable that some drive around with loudspeakers transmitting the screams of torture chambers. A potential solution becomes a problem because of external (non intrinsic) factors. It would be much, much easier to fix the external factors of the taxation problem than those of the "broken cybernetics" problem.
This smacks of a combination of "Real socialism has never been tried" in combination with the axiom of "Insanity is doing the same thing over and over again expecting different results"
The factor you are not considering is the omnipresence of corruption. Power Corrupts, and the more power you give government the more corrupt it becomes, this is born out time and time again, yet humanity refuses to learn this lesson.
The second you give government the powers you are advocating for, the people in government start thinking of all the different ways they can "help society", this amount of power is incredibly corrupting and can not be resisted, thus it always ends badly. ALWAYS
Insanity is doing the same thing over and over again /under the same conditions/ expecting different results.
The «lesson» you talk about is again not a deduction but an induction. Engineer your system properly, and it will have to work.
If at first you don't succeed, call a hacker. They must be somewhere.
Incidentally, going to the context: the issue is, as you indicate, that "said people cannot resist corruption", well, stop giving power to "«people»" then - to those embarrassing liabilities I hear about. (They probably terrorize me more than you.) Which by the way, is one of the actual codified ways to tackle the problem (since at least 3800 years).
Ineffectiveness should be determined by a logical and technical argument over the method, proposed as a possible solution, itself. You should identify what has it go wrong in practice. And you have in part already done it: that taxes are not earmarked (on compensation) and that the discouragement factor is insufficient. That is not necessary, it is not intrinsic to the method.
Nearby I commented on the infernal noise from electric cars. That is not necessary, not intrinsic: it just happens that people think it acceptable that some drive around with loudspeakers transmitting the screams of torture chambers. A potential solution becomes a problem because of external (non intrinsic) factors. It would be much, much easier to fix the external factors of the taxation problem than those of the "broken cybernetics" problem.