Tag Archives: morality

Taxes and Fairness

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There’s this example from a recent Wall Street Journal op-ed.

[I]t is worth noting that from 1958 to 2010, the taxes paid by the top 3% of earners, as a percentage of total personal income (which can’t be reduced by shelters), increased to 3.96% from 2.72%, while the percentage paid by the bottom two-thirds of filers fell to 0.51% in 2010 from 2.7%.

We went from everyone paying roughly the same rates on personal income to some Americans being forced to pay 8 times the rate as other Americans.

And those earlier, higher tax rates that are supposed to be so much more fair?  They were coupled with things like this:

The tax code of the 1950s allowed upper-income Americans to take exemptions and deductions that are unheard of today.  Tax shelters were widespread, and not just for the superrich….

For instance, a doctor who earned $50,000 through his medical practice could reduce his taxable income to zero with $50,000 in paper losses or depreciation from property he owned through a real-estate investment partnership.  Huge numbers of professionals signed up for all kinds of money-losing schemes.  Today, a corresponding doctor earning $500,000 can deduct a maximum of $3,000 from his taxable income, no matter how large the loss.

Now, it’s true enough that the Clinton-era tax rate tables, so beloved of the Progressives today, didn’t allow for such uneconomic activities as write-offs.  But the Clinton-era spending rates also didn’t allow for the spending rates so beloved of the Progressives today.

Entitlement

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Detroit has it.  They paid for it, fair and square.  Councilwoman JoAnn Watson says so.

After the election of Jimmy Carter, the honorable Coleman Alexander Young, he went to Washington, DC, and came home with some bacon.  That’s what you do.  That’s what you do.

Our people in an overwhelming way supported the re-election of this president and there ought to be a quid pro quo and you ought to exercise leadership on that.

We exist.  We’re entitled.  Pay up, Suckah.

Welfare and Economic Mobility

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I’ve written elsewhere of the trap for Americans that is welfare in  the form of handouts. The CBO’s Nov 2012 report, Effective Marginal Tax Rates for Low- and Moderate-Income Workers, makes this explicit.  Here are two examples from the report:

[T]he single parent who moved from not working to working part-time would face a marginal tax rate of 36 percent because even a modest level of earnings would result in the reduction or loss of several transfer benefits [the tax].  Earnings from part-time work would result in a loss of eligibility for assistance through the Temporary Assistance for Needy Families program, some reduction in the housing voucher, and a decrease in benefits available through the Supplemental Nutrition Assistance Program.

And

The marginal tax rate associated with moving from part-time to full-time employment…would be higher—47 percent.  Earnings from full-time work would place the single parent in the EITC’s plateau range and would allow him or her to claim the maximum EITC [Earned Income Tax Credit] amount ($3,169 in 2012).  However, because moving from part-time work to full-time work does not increase the EITC as much as does moving from not working to working part-time, marginal tax rates in this scenario would be higher than in the first scenario.

The disincentive to get work is large, but by remaining in her current situation, the single mother (yes, I’m assuming) is foregoing opportunity to improve her economic situation: there is potential for advancement, pay raises, and so on with a paying job.  Remaining on the government’s dole leaves this woman dependent on her government for her livelihood.  And doing so makes it even harder for her child(ren) to move up the economic ladder in his own time.  Upward mobility is severely handicapped, if not foreclosed altogether.

YGTBSM

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In another demonstration of the Obama administration’s support for our Middle East allies, his Secretary of State, Hillary Clinton, said at the Saban Center for Middle East Policy last Friday that Israel is suspicious of Palestinians and doesn’t care enough about their plight.

Passing up no opportunity to demonstrate the administration’s support, Clinton added

I’m not making excuses for the missed opportunities of the Israelis, or the lack of generosity, the lack of empathy that I think goes hand-in-hand with the suspicion….  So, yes, there is more that the Israelis need to do to really demonstrate that they do understand the pain of an oppressed people in their minds, and they want to figure out, within the bounds of security and a Jewish democratic state, what can be accomplished[.]

Not a word about the “lack of generosity, the lack of empathy” from the terrorists whose only goal is to butcher Israelis and their children.  Not a word about there being “more that the [Palestinians] need to do to really demonstrate that they do understand the pain of a people [who are the objects of their terrorism] in their minds.”

And this Progressive administration insists, with a straight face, that they fully support Israel.  And they cynically elide the fact that with the UN’s recent vote, the Oslo accords have been abrogated, and so there is no one with whom to negotiate for the Israelis.

Opportunity Inequality and Outcome Inequality

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From The Federalist No 10:

There are two methods of curing the mischiefs of faction: the one, by removing its causes; the other, by controlling its effects.

There are again two methods of removing the causes of faction: the one, by destroying the liberty which is essential to its existence; the other, by giving to every citizen the same opinions, the same passions, and the same interests.

…

But it could not be less folly to abolish liberty, which is essential to political life, because it nourishes faction, than it would be to wish the annihilation of air, which is essential to animal life, because it imparts to fire its destructive agency.

The second expedient is as impracticable as the first would be unwise.  As long as the reason of man continues fallible, and he is at liberty to exercise it, different opinions will be formed.  As long as the connection subsists between his reason and his self-love, his opinions and his passions will have a reciprocal influence on each other….  The diversity in the faculties of men, from which the rights of property originate, is not less an insuperable obstacle to a uniformity of interests.  The protection of these faculties is the first object of government.

Whence the modern Liberals’ (in stark contrast to this view, typical of 18th Century Liberals) disdain for the equality of opportunity that allows each man to show the best that there is in him—and so necessarily leads to unequal outcomes?  Whence the drive of our modern Liberals to render unequal our access to opportunity that, aside from being at the foundation of our country are central to our society’s overall prosperity, by capping every man’s final success and driving us to equal (and impoverished) outcomes?

Hmm….