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No representation without taxation
Amity Shlaes
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TEXT OF COMMENTARY
Kai Ryssdal: Those famed secret Swiss bank accounts are going to be getting a little less secret. The Swiss finance minister said today he's going to loosen up secrecy laws to keep Switzerland off a European black list of tax havens.
Back here at home it's not tax havens so much that politicians are worried about, it's tax increases. President Obama's going to have to deal with criticism from both sides of the aisle in Congress as he works out his budget plan for next year. Commentator Amity Shlaes says the discussion can't forget the lower ends of the tax charts.
Amity Shlaes: Taxation without representation. That's what our nation's founders rebelled against. Subjects in the colonies were sending money home to the crown without getting say in their own government. The course of U.S. history can be seen as progress by those who are taxed to get representation. Think of women with the 19th Amendment.
Along the way we began to pay out money to groups that paid no income tax at all. There's Medicare, of course, for senior citizens, even if they never worked; welfare for the poor and struggling, at least through the 90s. And, more recently, there's the earned income tax credit, a break for low income workers. The credit was designed to make people want to work and to offset their heavy pension payments for Social Security. The result of expanding it, however, is that many people who work don't pay income tax. Instead, they get money back.
Do we want to help weaker citizens, especially in downturns? Totally. In fact, both parties have plans that relieve yet more taxpayers of their burden. Republicans like payroll tax holidays. And the Obama administration is zeroing out the income tax obligations of yet more citizens.
But a tipping point does come when too many are paying out and too few are paying in. Maybe that tipping point is now. Today, households in the bottom half of earners pay only 4 percent of the income taxes. One tiny group, the top 1 percent, pays close to 40 percent.
This can slow the economic recovery we're waiting for. Top earners won't want to keep producing if their burden gets much heavier. But the more important problem is a problem of civics. All presidents talk about the need for community. We strengthen that sense of community when everyone has to pay some taxes. Like jury duty, paying taxes reminds you that you are part of something; it reminds you of what you owe, not just what's owed to you.
The mood of the skeptics today is just the reverse of the mood at the Boston Tea Party. Then, we said no taxation without representation. Today, try flipping that line: No representation without taxation.
Kai Ryssdal: Amity Shlaes is a senior fellow at the Council on Foreign Relations.
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It's distressing for me to hear this on Marketplace. Please bring honest arguments to the table. As dailykos says:
"If you provide a space for commentary on the holocaust, and your main speaker is Bishop Richard Williamson, you know what you're going to get. Likewise, if you have a national show on the economy, and you ask Amity Shlaes to present the commentary, you know what she will deliver: morally prurient lies designed to mislead the public on the best solutions to our economic problems. For Shlaes to keep telling her lies is pitiful. For national media to keep providing her an unchecked platform shows that the media would still rather believe in right wing unicorns than face reality."
I once contacted Amity for an interview, and she declared that she'd only accept if she had final say over which quotes we used. Seriously??
Interesting Commentaries. I see a constellation of problems in US. The systems are increasingly rewarding bad behaviors, punishing decent real hard working people. Please let me explain. Sure, I'll agree to pay even 50% Tax if I made Trillions/year like Bernie Madoff or other wallstreet CEOs. What would I care if I enjoy 30-40 years of luxury & jailed for 10-15 year & died? No one lives forever!! It is not their money to begin with anyway!! On the other hand, I will be excited to get $100 more per month on unemployment & collecting welfare, the less tax the better. Again, its not my money to begin with, anyway!
The other day, I thought that I was seen by a doctor...and it turns out that he is only some sort of assistant(with only 1-2 year of associate degree). I was lucky, someone told me that I wasn't seen by Kramer-type dermatologist (like in a Seinfeld episode)!! But I still get charge for whopping 80 bucks for basically a few bandages!! Once my superior told me to stop working overtime because other co-worker are "concern" that I am too hard-working. He told me that I am a hard worker, but I need to mix-in (during work, if others slack off, smoke a joint, can't figure out 1+1=?, drunk, etc., I should too! Dont' stand out, don't work too hard, especially, don't make more than they do)!! Now, I am seriously considering a career as a "professional crook" like Madoff, or some HedgeFund manager, or some big cheese insurance CEO (where the whole scheme is to insure risks, but will raise premium, refused sick patients,that deem to be high risks), or other quick-rich schemes like generating & selling those bad-asset mortgages to Taxpayers. Maybe! I will adopt 20 kids and collect more welfare!! Better yet, let partition to get "Octomom" (in CA) to run for next president!! Bye! Bye ! are the days of decent earnings from hard working!! Also, in the name of democracy, we should have one and only one voice!!
Well, you see, these problems had been brewing for quite sometimes; they were exemplified during this crisis, yet most Americans still refuse to recognize these problems. Lots of local governments are laying off people or getting pay-cut. Would congress or those in Washington agree to have a pay-cut(they had unanimously passed wage increases several years back). Again, it was not their money to begin with!!
Wow who is the idiot that invites this pseudo bullshitter to become a commentary on this show? Does anyone over there do any vetting? Her argument is all bullshit lie and she know its and she has been show to be lying by none other than Paul Krugman.
W hartsell: Put down the pop psych degree, right now. The Laffer curve (which is what you're referring to when referencing an increase in tax revenue when taxes drop) has NOTHING to do with motivation or psychology. It has to do with the short term burst to employment and spending that supply-side economics generates. The problem with the Laffer curve argument is that it has a flip side... drop the rate of taxation too low and the economy BOTTOMS OUT... which is what we're seeing here. Conservatives conveniently forget that aspect to it. Your simple-high-school level behaviorism argument was LONG ago disproven by REAL psychologists. The truth is that motivation comes from many different places. No matter how well the upper class is taxed, they're still going to be making more money than other people. The idea that the rich will take their ball and go home is simply not in keeping with reality. Has it ever actually happened? No... even when taxation was higher. In fact, historically, tax revenues have been highest when the wealthy are paying the greatest amount -- Clinton, etc... there's also correlation with the Dow and standard of living measures. I could go on... but the simple fact is that anyone arguing for supply side right now is an intellectual midget and needs to not be given a stage from which to spew their misunderstanding of reality.
Wow. There seems to be a lot of jealousy and envy in most of these remarks. Those rich people just aren't paying their fair share!
Here is some basic human psychology: when you reward a behavior, you get more of it. When you add disincentives, you get less. On multiple occasions when the top tax rates have been cut (Coolidge and Chase in the 1920s, Kennedy(!) in the 1960s, Reagan in the 1980s, and Bush in the past 8 years), the tax REVENUES have increased in subsequent years, because there was an incentive to be more productive. And remember - these are taxes on income, not wealth. When you raise the income tax rates, you are taxing productivity - so you get less productivity.
Now imagine that the NBA used the progressive foul rates for games. A player who averages 20 points per game would get to shoot one free throw if he is fouled, but a benchwarmer averaging only 1 point per game would get to shoot 10 free throws - after all, that is only fair! The top scorers would be penalized; my guess is that they would not have the same incentive to practice hard or work on their 3-point shooting.
Your feelings about fairness don't change economics, and certainly won't have much of an impact on others people's behaviors. But those disincentives you place in their paths certainly will impact their behavior!
We might all pause a moment to reflect that there are many non-monetary ways of fulfilling civic obligations. Ms Shlaes herself mentions jury duty. First Lady Michelle Obama today draws our attention again to military families. It is a fact that the poor and the working class are overrepresented in the armed forces, and therefore in casualty lists as well. If the only sacrifice you and I are making is to pay taxes, we should count ourselves fortunate.
Ironically, those with no money now... the poor and middle class have no representation, as the rich utilize lobbyist to gain representation though paying less taxes. So, really, lets have no representation without taxation, especially the rich!
The poster who wrote "...while the average WAGE EARNER pays nearer 35%. Add to this that the 35% hit on someone making less than $50K a year..." is sadly misinformed.
In 2008, a couple, filing jointly, with no children and making $50K is paying federal income tax equal to 8.032% of the $50K wage, not 35%--quite a difference.
The math is $50K minus exemptions ($7K for a couple) then minus the standard deduction of $10.9K. That leaves a taxable income of $32,100. The 2008 Tax Table shows the income tax amount to be $4,016--8% of the $50K wage. It would be 6% if they had two children. $100K, 13%.
If anyone doubts the above, see http://www.irs.gov/pub/irs-pdf/i1040.pdf.
One can have any fairness opinion that he or she wishes, but it would be helpful to have the numbers on which you base your opinion be correct ones.
.....and if we have a national health program like every other industrialized country in the world, I might have to sit in the same waiting room with poor people! I might choose to just die, which would really hurt the economy of myth making propaganda machines like CFR and their dissemination vehicles like the NYT and NPR.......
This is not about a class wars. Take the median income per State and multiply by voting percentage (Obama vs. McCain) and you will find that the "leftists" are richer than the "rightists" by almost 20%!. Yes sir, the poorest ARE amongst the bulk of the republican vote. This means that the class war is bull; the democrats ARE on the average richer than the republicans. Higher taxes on the richer is an incentive to invest money before taxes (small businesses), and lower taxes in the lower income is money that will get spent in their local economies, because the poorer don't save as much (or just get in more debt) as the richer. Another fallacy is the thought that you would work less to fall into the 90K bracket instead of the 100K; what changes with progressive taxes is the SLOPE of the curve (for the average tax rate which is what counts), it is NOT a step change. Get it?
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