Wednesday, October 29, 2008

Taxing Times

Thomas Sowell, columnist and formerly a professor of economics, explains why Obama's tax plan would hurt everyone. It will not "spread the wealth around" but decapitalize Americans in general, especially as corporations put their money in other countries as a result of higher tax rates here. Moreover, higher taxes on corporations hurts those with pensions dependent on corporate profits.

Sadly, many Americans are emotionally manipulated ignoramuses when it comes to taxation and the philosophy of the state. They are sentimentally moved by inflated rhetoric about "taxing the rich to help the poor." Then those who do not support this confiscation are attacked as insensitive or even unChristian. The truth is this: "The power to tax is the power to destroy."

8 comments:

PrinceOfFools said...

This is one of the key reasons I can't bring myself to vote for Democrats. My experience with discussing economic issues with people in this country so often brings about the Deer in Headlights look. That the press is ignorant of implications of these Socialist tax policies is no surprise. Milton Friedman once said something to the effect of "Whenever members of the media use the term 'Economists Agree' only God knows who they are talking about." I highly recommend his book Free to Choose to get an appreciation for basic economic principles. You'll never be able to listen to a Politician again without shaking your head.

Sirfab said...

Dr. Groothuis:

No one likes to pay taxes, but to refer to taxation as "confiscation" is leading. Taxation is the price we pay to live in society (note that I did not say "civilized" society, because simply paying taxes has nothing to do with the degree of civilization of society. Feudal lords imposed taxes on their subjects and no one would dream of calling their society civilized.)

You say that the power to tax is the power to destroy: it may be true, but it cuts both ways. The power not to tax also carries the power to destroy, and the proportion of taxes different income groups are called to pay has destructive effects on some.

In terms of discretionary income, you and I pay an infinitely higher percent of taxes than the wealthiest among us, and we work no less, or less hard, I bet you.

One other thing: you calling many Americans "emotionally manipulated ignoramuses" because, in essence, they disagree with you or Sowell. Have you considered that perhaps many Americans understand quite well the concept of fair taxation (which has nothing to do with the "Fair Tax" that conservatives support and which is another example of the Orwellian distortion of our vocabulary, like the Clean Air Act, or No Child Left Behind, etc.), and that you have no right to or basis for the claim you make?

Too many Americans are crushed under the weight of unequal and unjust taxation. Yes, as we are constantly reminded by the right wing, the middle class pays a lower share of taxes than the wealthiest one percent. What is never said, though, is that the middle class carries an inordinate burden when measured as a percentage of discretionary income. The amount of tax that I pay is infinitely higher than the amount of tax Bill Gates pays in relation to my ability to pay.

After I have paid my mortgage, car payments, various insurance premiums, health insurance, sundry bills, food, clothing, and other necessities, I pay income tax on what's left. And what is left after taxes is not much. But you, Sowell and Reaganmaniacs cry foul when a Democrat proposes to raise the marginal tax rate by less than 5% on people who will have to sacrifice absolutely nothing other than a piece of their ego and a negligible sum of their gargantuan income.

By the way, the effectiveness of Reaganomics in lifting all boats and the dire effects of gung-ho deregulation are under everyone eyes. Discredit comes not from the opinions of ideologues, but by 30 years of evidence. Time to try something different.

Sirfab said...

And one more thing, about this chilling rationale from Sowell:

"The two months between the time of a presidential election and the time when the new president takes office is an eternity in terms of how much money can be transferred out of the country electronically before any new high-tax laws can be enacted."

Is Sowell saying that there are those among "Country First"-ers who will move money out of the U.S. economy because they put their greed before the country? How hypocritical!

I'd say this: if you want to be called patriotic, be a patriot, put country first, and accept a nominal increase in your taxes. And let the government tax any sum of money that you repatriate from foreign investments. Or move.

Doug Groothuis said...

Reagan is not to blame for the present problem. He left office in 1992. Dem policy is largely to blame.

Gates pays millions of more dollars in taxes than you do. If I had my way, there would be a flat tax.

Taxation does not create wealth. People create wealth when given the freedom to use their money accordingly. Or they fail to do so. Heavy taxation is not the engine to freedom. That is statism.

Doug Groothuis said...

I am an ignoramus on taxes compared to Dr. Sowell, who is an economist. All that disagree with us are not ignoramuses; I never said that. I said that most Americans are and that they would be better informed if they read Sowell.

So, how many books by Sowell have you read?

Doug Groothuis said...

I am an ignoramus on taxes compared to Dr. Sowell, who is an economist. All that disagree with us are not ignoramuses; I never said that. I said that most Americans are and that they would be better informed if they read Sowell.

So, how many books by Sowell have you read?

Bill said...

Doug:

Reagan left office in 88, not 92. Also, in so small part because of the tax policy, took the United States from being the world's largest international creditor to the world's largest debtor nation.

Doug Groothuis said...

Reagan left in 1988. Thanks, Bill.