Of Taxes, Wisdom And Liberty
There has recently been and still is much talk about last-minute extension of tax cuts passed to expire almost ten years ago, who should get them and who should not, and how these questions may play on the economy. I have recorded the Sunday news talk programs for many years. Assumedly as their expert contribution to the topic on Sunday, ABC’s This Week With Christiane Amanpour (it’s almost painful to watch the Bozos they sometimes now parade to the roundtable to exchange with George Will who has served since the program’s inception with David Brinkley in 1981), had a full-length special discussion with billionaires Warren Buffett, Bill Gates (2 of the richest few men in the world) and Ted Turner. All three of these “wise” men thought the wealthy needed to pay higher taxes.
I am a terminally middle-class popular nobody and plead nothing of credentials, but only ask consideration of the common-sense and logic that scrupulous attention to thinking and Christian devotion to truth has taught me to pursue above all else. Though I might live in relative luxury on the pay of one of their gardeners, I will confidently say that with respect to wisdom on this question, these 3 billionaires haven’t a clue what they are talking about.
Let’s set aside Turner, a well-established eccentric liberal devotee, and Gates who is a guy who made an intense pursuit of marketing microcomputer technology in its infancy and is now just trying to give back to society in any way he can, including via his longstanding liberal leanings. Turner years ago gave a billion dollars to the UN! Need I say more? And by his mid-twenties, money was no object in terms of Gates’ personal expenses.
Let’s look at Warren Buffett, who has long reported (and did again) the injustice of a system in which he effectively pays a lower percentage of his income in taxes than his employees, including secretaries. Of course, his employees aren’t paying other employees to put their money to work where it is shielded from taxes. I think a simple flat or consumption tax and no deductions or itemizations would easily dispose of this perceptual injustice. After all, there is not a thing stopping Buffet from mailing his employees’ taxation rate to the IRS.
But Buffett means well: he’s just playing the hand dealt him by “the system” like anyone else would who could. But also bear in mind that in the particular case of Buffett, he doesn’t create wealth, except to the extent that others produce with his investments. Though as a boy he pursued sales and fee-for-use opportunities, literally since a pre-teen he has been occupied with investing in the money-growing efforts of others. Now there’s nothing illegitimate about that, but perhaps it is some explanation of how he doesn’t primarily consider not just the earning potential but the wealth-CREATING function of his investment dollars.
When you think about it, it’s is exceptionally remarkable that one of the richest men in the world doesn’t recognize the clear superiority of his investments vs. tax dollars in terms of the welfare of the society’s citizenry. I’m sure he takes care of his family and his employees in what he sees as an appropriate manor as a provider. But so do the people who put his dollars to work in their various enterprises. And the government? With no market pressure applied to their operations, well we all know how productive, efficient and consumer-oriented they are.
All of my life, such conversations proceed as though the wealthy do nothing but squander their non-essential dollars. But they don’t cash it all in to create bonfires. Actually, even when splurged on wretched excess, they support the livelihoods of the providers of those goods and services, whether jewelers, yacht builders and sellers or country club owners and employees. But what actually happens with most non-essential wealth like Buffet’s is that an investing owner or employee puts the money to work in the enterprise of an organization who is creating wealth in a product or service. This or something like it is the ONLY way that ANYONE has a job. So, the more invested wealth, the better for society.
Consider Buffett: are the tens of billions he might be taxed of better use in government efforts or as tens of billions put to use in the private economy? Uh, please invest them near my place! Now none of this is to say that we needn’t defense and food and drug approval or that roads and schools and other public utilities shouldn’t be built, though they should as much as possible be by as local as possible authorities. But let’s do those infrastructure essentials and leave all the extra misspending on things that are properly tended by private, family and community structures out of tax considerations. And there are a WHOLE LOT of them.
Hey, isn’t everyone insisting that the serious fiscal problems lie in our big entitlement programs. Is it not nobler and more natural and proper that retirement and medical concerns should be tended by families, neighbors, and communities who would love to save all of the lifetime of FICA deductions taken from all of their paychecks? How’s that for something big to chew on?
At one point in the program, discussing the matters of increased tax revenue and spending cuts, Amanpour asked Gates whether there was a “silver bullet” in the task of rebalancing our finances. Gates and assumedly none of their “experts” came up with an answer. But yes, there IS a silver bullet. It’s called liberty and the respect for private property. That’s how America became the most productive nation in the world, and if we don’t recover that jet fuel for the system, then ALL of this other talk is a waste of time. In that case , BAD stuff is coming down for a spoiled nation that is way under water.
With reduced revenue in this down economy, we are still spending over 2 trillion dollars this year. I suspect we cannot create and collect more revenue with higher tax rates. We don’t need to resist a tax rate increase just “in this down economy” as Republicans find it politically expedient to put it. We don’t need to increase tax rates PERIOD! We need to reduce federal spending and have states implement competing policies.