Over taxation, oppressive regulation and currency manipulation, these are the foes as we battle to put the economy back on track. The truth is all these issues form a tangled web of economic impediments and any legitimate jobs plan will need to address them all.
This is where our noble field is strongest. As the old military cliché says, let us first know our enemy. I remember as a kid sitting in school (the thought of which still gives me nightmares) hearing one teacher or the other say, “The American revolution was more about taxes and economics than it was freedom.” I thought “bummer” that just sounds so much less noble. Like wise I used to despise the thought that people voted with their wallets instead of consciences. What the founding fathers knew and teacher did not, and I have learned in the last 10-15 years, is that the power to tax is the power to control, and that freedom and taxation are now and have always been inseparable. One of the most fundamental questions in beginning a discussion of taxation is: “what is the purpose of taxes?” is it A) to raise revenue to fund the necessary functions of government or B) to encourage and discourage certain behaviors and equalize income disparity. Conservatives tend to be in the A category, though you will still find that many do support the progressive tax scale and the use of income levels to determine tax reward and “punishment” i.e. Mitt Romney’s eliminating capital gains on people who’s income is under $200,000, so if you’re living in Mitt’s America and you have made 175,000 in November, you remove your goods and services from the market place between Thanksgiving and New Year. I actually think this whole thing is populism (a political strategy based on a calculated appeal to the interests or prejudices of ordinary people) and I do not support the merits of progressive taxation on either practical or ethical grounds. Contrast this to President Obama and his diatribe against the millionaires and billionaires, whom he defines as an income level of 250k, nigh unto 40% of total taxes, are paid by 1% of taxpayers. These evil SOB’s aren’t paying their fair share you see. The top 10% pay well over half of the tax bill and those whose income is above 62K which is half the country pay a whopping 96.93% of taxes. The rest of the country the other 66 million people pay 3% of the taxes. http://www.taxfoundation.org/news/show/22652.html
To clear up one more thing Obama’s argument that Warren Buffet’s secretary pays a higher rate than he does, Buffet’s success is in investments which are taxed as capital gains not income. Capital gains are taxed at 15% so the secretary has to make in excess of 34,500 which is the 25% bracket. Of course no liberal will ever say “Dang that poor woman’s taxes are too high” they say capital gains are suddenly too low, It matters not that investment drives business and thus jobs. To be populist for one moment, its you that will be screwed if capital gains goes up when you sell your home or property, i.e. when you retire and want to move into a smaller place after the kids have grown. Any value added to your home from the time you purchase it until the time you sell is what is taxed by capital gains. We the mob cry out for the government to take the sword of taxation and smite the rich but in the end it is our throat that is cut, for once the rich are smitten where must that sword go next?
The dirty little secret for those who believe in the plan a view of taxation is that raising rates seldom increases revenue to government. While that may sound counterintuitive it is nonetheless true. Pres. Obama knows it too, in one of the few real question asked in the 2008 campaign then Sen. Obama said even though lowering capital gains increases revenue its about fairness. He said so in the Democratic debate in April of 2008. Also remember the famous exchange with Joe the Plumber, “We have to spread the wealth around”. Of course the purpose of lowering taxes, especially business and capital gains is to spur investment and economic growth, the huge bump in revenue associated is an unintended consequence of a broader tax base.
Perhaps the most fundamental issue about taxation is shown in one phrase the President has used from time to time, when he refers to tax breaks as “expenses”. Why this is so disturbing is that the underlying idea has to be that the income of each American belongs to government and that it is up to government to decide what you get to keep. I say we the people decide what we allow the government to have and they must budget accordingly. As a farmer I see the estate tax as the most alarming example of this government arrogance.
So as we battle the dragon in our effort to rescue the fair maiden (a.k.a. the free enterprise system) which of our gallant princes (or princess) has the battle plan and the raw nerve to stand courageous in this fierce battle? Let’s examine each in the harsh light of scrutiny and see who shall be Free Enterprise’s champion.
We shall do so next time.
Keep on the firing line
No comments:
Post a Comment