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Tax day arrives!





By J. DeVoy

Dear the top 10% of income earners:  Thank you!  Because of your toil as business owners, doctors, lawyers and financial service experts, you are able to subsidize the lifestyles and safety of people like me – somewhat literate, moderately intelligent lifetime students – by paying more than 70% of all Federal income taxes.  My dirty secret is that for all my striving, I’m woefully below average at something — being a taxpayer.  Despite scrupulously filing my taxes every year, I haven’t been able to break median or even come close to it.  I fall into the group that contributes less than 3% of all Federal income taxes.

This disparity arises as a function of our progressive taxation regime, where the highest earners pay the most and lowest earners pay the least.  Indeed, the well-off don’t object to redistributionist policies that keep the poors from trammeling their quality of life, as urchins tend to be more interested in wealthy people’s consumer goods than their liberalism.  When the have-nots have nothing, they get violent.  This extortion arises in part from the underclass’s cognitive limitations, and unfortunately is only one form of tribute required to placate them.  Others range from ceding entire sections of American cities as no man’s land to carrying an emergency $20 in the event of a mugging.

Despite these realities, the one-person, one-vote model persists.  Forty-seven percent of households have no tax burden this year, yet every non-felon adult citizen in them has the right to vote.  This is incomprehensible.  While enduring none of the costs of maintaining the republic, they receive all of the benefits — and likely a disproportionate share.  While haves purchase health insurance, have-nots rely on government assistance.  Haves live in well-off neighborhoods, sometimes gated, and own home security systems; have-nots rely almost exclusively on the police for monitoring their property.  The same can be said of family relationships, where haves will send their children and themselves to the best therapists they can afford, while have-nots will call the police to resolve their domestic disputes once they inevitably explode into violence.

Two potential alternatives to the current system exist, which are held out as being more fair.  The first is a flat tax, which taxes all income at a fixed rate, rather than progressively.  While this would have a regressive effect, as the set rate of taxation would have to be fairly high, it would assure that every citizen contributed an equal component of his or her earnings.  Another alternative is a national sales tax, akin to the United Kingdom’s 17.5% Value-Added Tax (VAT), which is tacked on to every purchase.  Due to the lopsided cycle of spending in America, distorted by winter holidays, a national sales tax may create revenue issues for the national treasury.

We have ignored the wisdom of the ancients and our founding fathers.  Both Plato and Alexis de Tocqueville disliked democracy, with the latter famously saying “[a] democratic government is the only one in which those who vote for a tax can escape the obligation to pay it.”  Thomas Jefferson described democracy as a form of “mob rule.”  While we live in a republic and not a democracy, we pander to the rubes and outwardly consider their positions and opinions, as if the half-thoughts they express in YouTube and Perez Hilton comments can be characterized as such, so that our elected officials can ensconce themselves deeply in their elected positions.  It is a distinction without a difference.

The forefathers were wrong about some things.  Today it is unthinkable that voting would be limited to white men.  They were, however, deadly accurate in limiting voting to landowners.  Restricting the franchise to those with something to lose leads to more prudent government, even if it does have a redistributionist bent.  Rationally, those with property after a lifetime spent acquiring it are less likely to squander it for nothing than those who never had such niceties, and thus cannot appreciate them.  When the bitterness of envy and class resentment is grafted onto this latter group’s ignorance – a seemingly natural consequence of the Dunning-Kruger and Downing effects – reckless decisions become spiteful ones; the destruction of wealth is not born from ignorance, but spawned of malice.

Thus, the choices for creating a legitimate tax model are clear: All must suffer equally, or those who suffer more must be accorded a greater voice.  Allowing the most productive members of society to be stripped of their wealth by sheer force of numbers, even if the fleeced would agree to the payment and its aims, is unjustifiable.  There is no endpoint where the masses can no longer expropriate wealth.  Just as in business and especially Venture Capital, the party bearing the greatest financial burden should be accorded the most say in how its finite resources are used.  After all, this is their property we’re talking about.  Beyond making economic sense, it is loyal to the most important rule of all, the Golden Rule: The one with the gold makes the rules.

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