Philip P:
Paying taxes is not a necessary evil, it’s a patriotic duty (though the level of taxation is certainly something reasonable people can disagree with).
An equally patriotic duty is the careful and prudent management of the people’s money.
Taking a trillion dollars from Social Security in a mere seven years is not careful and prudent management. Building an artificial rainforest “for educational purposes” when many children leave school unable to read and write is not careful and prudent management.
Philip P:
What constitutes “crushing” taxation?
Taxation which alters economic decisions is crushing. When people break up holdings, fail to capitalize on returns, and seek to funnel money and effort into tax avoidance you have crushing taxation.
Examples include the excise tax on yachts over $100,000. This law was passed during the Carter Administration. Hey, anyone who can afford $100,000 for a yacht OUGHT to pay more taxes, right?
What happened is the American yacht industry collapsed, and people who had been productive citizens working in that industry lost their jobs.
Arkansas, with a lot of trucking companies decided to raise the fees to license trucks. Hey, big trucking companies can afford to pay more, right?
What happened was the trucking companies registered their trucks in other states and Arkansas lost revenue.
Philip P:
Let’s make an extreme example. Suppose person A makes $20,000 a year and is taxed at 10%, while person B makes $1,000,000 a year and is taxed at 90%. Person A pays $2000 in taxes, leaving him with $18,000 for the year. That may very well be crushing taxation. Person B is left with $100,000.00 for the year. Crushing taxation?
You bet it is – because Person B says, “The hell with it,” moves his business off-shore, and Person A, who works for him, loses his job.
Philip P:
Apples to oranges, Vern. America in the 17th, 18th, and early 19th century was a very different than after WWI. For one thing it was far more rural. Our military commitments were smaller, simpler, and less sustained. It was a different society.
The REAL apples to oranges is this, Philip – in the pre-WWI era, the United States became a creditor nation. Other nations owed us more than we owed them.
Now we are a debtor nation – we owe others more than they owe us.
Philip P:
And that’s what this is really about. It makes no sense to argue about what the “right” tax is, because the correct tax level is that which allows us to afford the society we want. The real question is, what kind of society do we want? Then the follow up question is what steps and policies are necessary to achieve that? Then, we ask how do we finance it? Personally, I have no desire to return to the Gilded Age. I think a vibrant and growing middle class is key to our nation’s health (not that they’re directly correlated, but taxes have tended to be higher when the middle class was growing)…
Taxes tended to be higher, and the middle class paid them – and it wasn’t taxes that created the middle class.
But it is taxes that move businesses offshore, cause other businesses to outsource, and create pockets of poverty throughout this nation.
Philip P:
Even today, I think a society like downstate NY (including the city, but also the suburbs) is preferable to most of, say, Alabama, where taxes are much lower.
And much of that is due to a historic tax break going to places like New York, at the expense of Alabama. In fact, one of the underlying causes of the Civil War was the high tariffs – which benefited the Northeast (making their manufactured goods easier to sell) and hurt states like Alabama, which had to pay the tariff or buy from the Northeast at higher pices.
Philip P:
I see democratic government as the expression of the people. If it has become more involved over the last century as society has changed, I see that as a positive.
I see democratic government as a system where politicians serve the people, manage the public funds with care and prudence, and work to help people maximize their potential, not stifle it with substandard schools, high taxes, and pork barrel projects.