Loading ...THE TAXMAN COMETH
I’m heading back to Indianapolis today after spending the last few days getting caught up with friends, tending to legal matters and visiting with my accountant. And after doing my taxes again this year, I have re-affirmed my disdain for the federal government and how it spends the money it takes from me. What makes matters worse is the more I make (i.e. the more a productive and contributing member of society I am) the more this government wants to take from me.
I understand more than a lot of people that taxes are the price we pay for civilization, but can’t we be a little more civilized about the way to do these things.
If I had my way, I would eliminate income taxes altogether and replace them with a “federal transaction fee” on all goods and services. The rate would fall somewhere between 3-5%. But every time you made a retail purchase, a car a house, food, lawyer, doctor, etc., you would pay the FTF. This way you only pay the tax when you spend the money. And we as Americans like to spend money as shown by the fact we have so much debt.
Unlike the “fair tax” which taxes only new purchases at a rate of about 27% by some estimates, the FTF would have a much broader tax base, thereby translating into a much lower rate. Everybody would pay it, because everybody spends money.
No one should have to pay more in taxes simply because they are more productive than someone else. You would get to keep more of your own money and a lot of wealth would be freed up and tax code made much simpler. Yes, there will always be tax cheats, just like there will always be poor people. A pretty famous guy once said that.
And there is no reason why such a system, for a few percentage points more, couldn’t be adopted at the state and local levels in exchange for the elimination of property taxes.
And for those of you who think I am just acting as some spoiled little yuppie (or buppie in my case) who is mad that he has to pay the federal money, your damn right.
The federal government didn’t go out and work 80-90 hour work weeks, I did. The federal government did not train and study for years to get marketable skills which are in demand in the workplace. All the federal government did was go out and run up a bunch of bills and get involved in a war that I didn’t ask for (I ordered Afghanistan and Bin Laden, not Iraq and Saddam Hussein) And don’t even get me started on Social Security, Medicare and Medicaid.
To the federal government, all a single, able-bodied, strong capable young man like me is good for is producing income which it can take away. So when you put it in that perspective the only difference between me and my ancestor from 200 years ago is that he wore chains.
Talk to you tomorrow.
March 30th, 2008 at 8:58 am
Think of it this way - because you have more wealth; the police have to protect more of your stuff than they do of the guy who has nothing.
Also, our stable form of government has been more beneficial to you than it has been to lesser lights of our society who might benefit more from a police force that was lax.
March 30th, 2008 at 10:50 am
There’s a reason most of us draw a line at Ferrari in the driveway or getting that second or third family dog. That budgetary common sense eludes many elected officials because it stands in the ways of their reelection, or many voters because it seems so innocuous, compasionate, and diffused to have “everybody” paying for it. History’s full of examples of goverments crumbling from this mentality versus outright invasion. When will we cease being help-up by the latest accusations of being “haters”, because we disagree with the latest round of SCHIP increases or because the childbirth entitlement is a spriraling madness? There’s work to be done on both sides of all racial, political and economic spectrums, but consumption without sufficient production will eventually come to a halt. How many of those who depend on the helping hand of the taxpayer will be helped then?
March 30th, 2008 at 11:02 am
I agree with your concept but disagree with your personal reference to ancestral chains. Do we really need to go there? All of us were chained to the behavior of our government two hundred years ago until we threw off the shackles of King George only to be enslaved to overbearing government and its ills today. When people have their very homes jeapordized through unfair taxation is a prime example, which is why I have been protesting. If you want to break the chains that bind ALL of us, you have 2 very valuable assets: your voice and your vote. You, in particular, have the power and freedom of the microphone and many would consider you doubly blessed.
March 30th, 2008 at 12:56 pm
Unfortunately, or maybe fortunately, it takes time for the ills to impact the traditionally silent majority. My view is that we are approaching that critical mass. My fear is that the response will be ugly. But a response is needed. Points 2 and 3 above hit home.
March 30th, 2008 at 4:51 pm
The point can’t be made much better than you’ve made it Abdul. While the sweaty sheriff may not be lording over us as we toil in the fields, this system is no less insidious. If we’re concerned about domestic abuse in this country, we need look no further than our government’s unconstitutional taking of our lives in the form of time (by minutes & hours that become days & months, moving tax freedom day farther into the future), and property (currency, assets). In the process, we’re destroying the American ideal. Is this is a better America we’re becoming?
March 30th, 2008 at 7:02 pm
You can thank Bush War for your taxes and the for the taxes WE American will have to pay for the next 30 years.
March 30th, 2008 at 7:21 pm
I disagree that taxes are the price we pay for civilization. Taxes “should be” the price we pay for civilization. Instead, they have become the price levied upon us to finance a corporatist government that’s hell bent on dragging the world into a single geopolitical system.
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Additionally, our taxes aren’t even used to fund the government. They’re used to pay the loans to the private Fed banks who fund our government. That’s not civilization. That’s theft.
March 30th, 2008 at 8:00 pm
New 1040:
Line 1–How much did you make last year? ______
Line 2–Send it in.__________
March 30th, 2008 at 8:05 pm
Abdul!
Wah!Wah!Wah!Wah!Wah!Wah!Wah!Wah!Wah!Wah!Wah!Wah!
Quit whining.
flipper
March 30th, 2008 at 9:14 pm
It all gets back to history. And history repeating itself. The politicians need to look back at events like the Boston Tea Party and realize that a revolution based on over-taxation happened once and it can happen again. We can, as citizens, only take so much and I have a feeling we are getting to that point.
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REMEMBER NOVEMBER
March 30th, 2008 at 9:35 pm
Jon G, I would agree with your thoughts about a revolution, but unfortunately, this time it will not be the people against the government, but people against people. At the Boston Tea Party, it was about money going upward. Now, much money comes back in the way of welfare programs (S.S., unemployment, medicare, medicaid, subsidy to every conceivable business venture) and hence will set one citizen against another. Convenient, right?
March 30th, 2008 at 9:54 pm
Yeah, good point. It will definitely be a middle class uprising. We are turning into a country of enablers. What I don’t get is why the democrats, who want to tax and spend and hand out all of OUR money to enable people, don’t give the government most of THEIR paychecks to fund their pet projects. That way I can maybe keep more of the money I WORK FOR.
March 30th, 2008 at 10:35 pm
Some folks had to lose their lives to protect…This system?
March 31st, 2008 at 12:14 am
I believe there is a proposal similar to what Abdul suggests called the “1% Tax” or something like that. It is basically a 1% tax on EVERY transaction. Interesting concept, but still ends up with the true cost of government buried in the prices of products and such.
The great thing about The FairTax is that people will close their wallets as the rate goes up and open them as it goes down.
The real question is, when the revolution finally takes hold and starts to be less civil, which side will the military be on or will it split into factions?
Or do we all have to wait until we can settle somewhere else like on the Moon or Mars to start over with a free society again? Taxes are low, but the higher solar radiation is a bitch.
;-)
March 31st, 2008 at 1:51 am
You went to NIU and UIS, which are both subsidized by tax dollars. So it looks like gov’t did have something to do with those “marketable skills,” especially if you got any financial aid (like grants and government-backed loans).
Plus, how much of your income is directly because of gov’t—either reporting on it or directly working for it (like the classes you teach)? And do you ever drive on highways to get to work?
To me, it looks like practically your entire paycheck is from gov’t, so it makes you look somewhat petty and small to now complain about having to pay taxes.
And as an aside, the concept behind progressive taxation is to tax disposable income. You make (I’m assuming) well beyond what is needed to put a roof over your head and keep your belly full, so you have more disposable income to tax. Be glad you have a good paycheck and think of the Hoosiers out of work that would love to have the salary to be in your tax bracket.
March 31st, 2008 at 7:20 am
Nice try to spin it Mike. Entitlement is TOTALLY different than actually doing work/providing a service and paying taxes.
Your Socialism is showing with your comments about paychecks, taxes, and disposable income. Why must someone who is successful pay a higher rate than someone who isn’t? I am all for a flat tax. The rich still pay more but the rate is the same. 10% of a million is way more than 10% of $38,000, right?
March 31st, 2008 at 7:30 am
Hey Mike - what business is it of yours - or the government - how much money Abdul, or ANYONE else makes?
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Your post at 15 smacks of socialism.
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If you feel so strongly that OTHER PEOPLE are somehow ‘entitled’ to the money that I went out and EARNED, why don’t YOU come to OUR homes and demand part of my EARNED money.
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Or, does the concept of placing yourself in personal danger to achieve your socio-political goals repugnant to you?
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Your views and goals directly collide with the ideals that this county was founded upon. Fear not, for you are in good company with ALL of our politicians and other government drones.
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People like you make me ill, and angry.
March 31st, 2008 at 7:46 am
Here’s the fairest, pay-your-share tax I can think of: one person, one bill. Take the cost of government and divide it by the population, then issue the bill.
I’ve never understood the claim that earning more means your bill is higher. Does earning more mean that you use greater federally provided defense? Pay directly for the services we use (tolls on interstates, etc.) then pay a bill for the rest.
Unless and until everybody gets the picture about how expensive this government is per capita, and is made to feel the burden of it EQUALLY, this process of draining the productive to the benefit of the unproductive will continue.
March 31st, 2008 at 9:09 am
O’come on Abdul, pay up.
March 31st, 2008 at 9:45 am
The progressive tax was a key of the Communist Manifesto. I guess that does not make it “communist” or “socialist”, but it certainly is a tool that both categories like because it helps with income redistribution.
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I don’t really care what the taxation method is. Shuffling taxes is nice, but it doesn’t really fix the problem. The problem is that our governments spend too much at every level.
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http://www.usgovernmentspending.com/ indicates that FY2008 all units of government in the U.S. will spend $5.1 Trillion. That is about $17,000 for every man, woman and child in the U.S.
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So until we fix what we spend, PLEASE Abdul. Keep working those 80 hour work weeks. Someone needs to take up the slack for my family of four’s bill of $68,000.
March 31st, 2008 at 9:52 am
“Why must someone who is successful pay a higher rate than someone who isn’t?”
Because $100 feels like a lot more money to someone making $30,000 a year than it does to someone making $100,000.
And just because I’m mature enough to recognize that taxes and government aren’t inherently evil doesn’t mean I’m a socialist. (And when did I imply a desire to have more government ownership of businesses?) It means I’m reasonable.
March 31st, 2008 at 10:17 am
Mike,
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“And just because I’m mature enough to recognize that taxes and government aren’t inherently evil…”
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It just means that you are out of step with the foundation of our nation. I suppose that they didn’t think it was “inherently evil” but rather “prone to evil” and should be severely limited. Even the worst big government founder would fume with what has happened over the last hundred years.
March 31st, 2008 at 2:04 pm
Mike, let me ask you a question: Why should government services cost a wealthy man more than they cost a poor man? Shouldn’t government be providing the same services to each?
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or…. is it your opinion that a wealthy man should be FORCED BY LAW to pay for needs of the poorer man?
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Isn’t that socialism?
March 31st, 2008 at 2:49 pm
At some point common sense must prevail. Perhaps a percentage of your income should go toward taxes, but lets make it the SAME PERCENTAGE RATE for everyone, not this ‘tax bracket’ crap. It is economics 101 that when you let people keep more of THEIR money they spend more and the economy is better for everyone. If we would just make taxing simpler and more fair then everyone would be happier and more prosperous. Of course that would mean government would have to streamline and run more efficiently, we can’t expect that now can we? lol
March 31st, 2008 at 7:29 pm
Basic question. Why does the complexity of our current tax system protect the mega rich through a web of specific tax loopholes? By mega rich, I am talking about people who make more than 1million per year. If there was a true flat tax, then the mega rich would have to pay their X percent, just like everyone else. From what I understand, that X percent would be very much more than they pay now through all the tax loopholes designed by and for the mega rich. I am not talking about a progressive tax system, just an honest across the board flat tax with zero loopholes. What would the Kerry’s, Kennedys, Soros’,Gates, Buffett’s, Bush’s etc. etc. really pay under such a system vs. today?
March 31st, 2008 at 9:49 pm
Greg,
Most of the loopholes and shelters used by the wealthy (net worth over 10 million, let’s say) are set up through various trusts and funds that are only accessible with a large minimum balance.
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Some wealthy folks in my family, for example, are heavily tied to PNC Advisors, a private trust dicision of PNC Bank. Their least profitable trusts begin with a minimum balance of $500k. Basically, you’ve gotta pay to play. And trust structures can vary, depending on the level of exposure you’re willing to accept to both risk and taxes.
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Also, if you’ve ever spent time in high wealth areas, like the Caldwells, Bergen, eastern Long Island, north Westchester, etc you can always find a TD branch office tucked away somewhere. Toronto Dominion is one of Canada’s premier tax shelters - Canada’s banking system is probably the leading global tax shelter, quietly reigning over the more notorious but less prestigious Cayman and other island shelters.
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These shelters are accessible only to the wealthy in the US for one very specific reason. Those who control our politicians have billions of dollars in annual profits to protect.
March 31st, 2008 at 9:53 pm
Greg, most people who are “mega rich” have very little actual income. They have wealth (assets), but not necessarily income. A flat tax would certainly be more fair, but it may or may not make the “mega rich” pay more in taxes.
April 1st, 2008 at 6:50 am
“Tax Free Day” is something like July 11th this year. Thus, it’s as if we work two jobs and only get a paycheck for one of them.
Now taxes are necessary, but this is ridiculous.
April 1st, 2008 at 11:18 am
“I suppose that they didn’t think it was ‘inherently evil’ but rather ‘prone to evil’ and should be severely limited.”
No…they did checks and balances to reflect the possibility that absolute power corrupts. They even made gov’t inefficient (which costs more money) to protect civil liberties.
April 1st, 2008 at 11:25 am
“Mike, let me ask you a question: Why should government services cost a wealthy man more than they cost a poor man? Shouldn’t government be providing the same services to each? or…. is it your opinion that a wealthy man should be FORCED BY LAW to pay for needs of the poorer man?”
Simple: Because the idea is to tax disposable income. And we’re not talking about user fees here.
Plus, more likely than not, the wealthy man probably got where he was because of opportunities that were created for him. (Or, created for his parents or grandparents, which in turn set him up for success.)
To quote one of my old friends, there is nothing wrong with being born with certain privileges. The only problem is when we fail to acknowledge the advantages we get.
”Isn’t that socialism?”
No, that’s progressive taxation. Socialism is an economic system where the means of production (natural resources, factories, etc.) are owned by the community as a whole. Sure, our economy has certain socialistic qualities (the postal service and airwaves, for example), but we’re no way near any sort of socialistic system.