Tag Archives: taxes

The Land of the Free

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Free Stuff, that is.  Here’s the latest from Senator and Progressive-Democratic Party Presidential candidate Elizabeth Warren (D, MA).  In addition to all the other free stuff she wants us to have, now she wants free child care.

[F]amilies living below the 200% poverty threshold (roughly $51,500 for a family of four) would get free access to child care and early education….

With this, Warren wants folks who, by her own definition, are not poverty-ridden to get free child care.  Notice, too, she’s lumped in with child care her “early education”—that’s her tacit admission that our public schools no longer provide actual education; they’re just child care facilities.

More importantly than that, though, is how she would pay for all of this.

Warren proposed using money from the ultra-millionaire tax that she announced at the end of January. Under the tax, anyone with more than $50 million in assets would pay a 2% tax. For those who have assets valued at $1 billion or higher, it would be a 3% tax.

That might—might—cover expenses for the first few years.  But Warren has no clue of what to do next (beyond, I assume, the usual Progressive-Democrat “solution” of raise taxes some more).  Warren has no clue where to get the money for all this free stuff (recall that she’s using her tax on the evil rich for other spending, too) when we don’t have any more rich because they’ve been taxed out of existence, no one aspires to be rich anymore (with the associated loss of economic activity and steady impoverishment of our population as a whole), the few remaining rich have moved their money overseas (and perhaps joined their money).

But hey—it’s Free Stuff today.  It’s votes today.

More important even than all of that is the moral damage she proposes to do to us Americans.  No longer are we to be responsible individuals, we’re just to be come wards of the State.  Her State.  Her State will supplant our individual morality with her own version; her State will strip us of our individual responsibilities, our individual duties.  Her State will do those.

Elizabeth Warren’s State is a socialist State.  John Adams wrote more than one hundred years ago that the nation of our Constitution required a virtuous, moral people to run it.  That’s not Elizabeth Warren’s State.

You’ve Made Enough Money

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The New Jersey governor says so, and he wants to raise the income tax on the rich and the not-yet rich—those making more than $1 million per annual year*—by almost a full per centage point, to 10.75%.

Because, he argues.

So far, even the Progressive-Democrat-run legislature is demurring from that move, but the governor seems poised to veto a budget that doesn’t have the tax increase.

Give it up, the Progressive-Democrat governor says. I have better uses for your money than you do, the Progressive-Democrat governor says.

 

*Think $1 million is a lot?  It is, but not so much in Trenton.  On a cost of living basis, that would be worth $1.4 million in northern Texas.

Union “Dues”

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Now the taxpayer looks to be on the hook.  At least in New York.

[O]n May 1, New York’s state Senate voted to let strikers get benefits one week after walking off the job—essentially putting them on equal footing with those who are laid off.
If Governor Andrew Cuomo signs this bill, he’ll effectively be using New York’s unemployment-insurance program to subsidize union strikes, upending the balance of power between workers and management.

Union strikes are little indistinguishable from extortion, except that they’re legal. They’re used to threaten a company’s ability to function—to survive—unless they surrender to union demands.  “Nice little business you got here. Be too bad if something was to happen to it.”

In a way, though, Cuomo’s pandering makes sense. Since unions can’t commandeer pieces of the paychecks of non-union workers anymore, they have to make up the money loss from somewhere.

Enter the victim-taxpayer.

A Foolish Proposal

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Senator and Progressive-Democratic Party Presidential candidate Kamala Harris has one.  She’s

proposing that large employers pay women on an equal basis with their male counterparts or face government fines, seeking a sweeping shift in the way the nation addresses pay inequity.

She wants to impose a 1% tax on “large” companies’ profit for every 1% disparity in pay.  The size of the disparity is an open question, though.  The favorite number of the Progressive-Democrats is that women are paid in the neighborhood of 70-75 cents for each dollar a man is paid for the same work; although the number Harris bandied was 80 cents.  That would make the Harris Payroll Tax run 20% or 25%-30% of profit.  The more valid, empirically derived number, though, puts that disparity between 0 and 7 cents less for the woman than the man, with a heavy lean toward the 7.  This more accurate number actually presumes to correct for time in the workforce, experience level on the job in question, and so on.

Beyond that, the Harris Payroll Tax is just plain bad finance.  Companies—small as well as large—pay Social Security and Medicare taxes on the wage they pay, and those same companies tie perks like health coverage, paid time off, bonuses, etc to the wage they pay.  An increase in wage would carry with it those added payroll costs.

It’d be cheaper for the companies to pay the Harris Payroll Tax than it would to raise the wage paid the woman.

Further, Harris would

put the burden on companies to demonstrate that they are not engaging in pay discrimination.

Because, typical of today’s Progressive-Democrats, we’re all guilty until proven innocent.  Especially when it’s difficult even to define the crime.

Modern Monetary Theory, Taxes, and Inflation

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Japan is examining MMT in its debate over its upcoming sales tax increase [emphasis added].

Some members of Parliament, led by ruling conservative-party lawmakers, argue Japan doesn’t need higher taxes because the country’s inflation is less than 1%. The theory suggests tax increases are needed only when inflation is out of control.

Notice that: MMT says increasing taxes is a means of controlling inflation.  The idea is that taking money away from the citizens reduces demand and so inflationary pressure.  There are a couple of problems with this concept.  One is that government revenue gets spent so Keynes’ aggregate demand goes unchanged, except for a bit of Government-as-middle-man friction.

The other is that, as our own Progressive-Democratic Party annually demonstrates, lowering raised taxes (or simply lowering taxes) is deucedly hard to do.

I offer an alternative solution to combatting out of control inflation, or even inflation that is simply higher than we want it to be.

To the extent Government (I’m omitting the Federal Reserve System on the naïve theory that it is independent of Government machinations—it is intended to be) intervention is useful at all in combating inflation (that utility is not established), here’s an intervention technique that any modern Keynesian should love: instead of raising taxes, cut Government spending.  After all, goes the Keynesian song and dance, Government spending is stimulative, so the increased demand is inflationary.  Cutting the stimulus ought to reduce inflation.