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http://www.youtube.com/watch?v=d8EyGpOU3qM

For more than a century it’s been generally recognized that the best taxes (admittedly this is an expression reminiscent of "the most pleasant death" or "the funniest Family Circus cartoon") are progressive– that is, proportionate to income.

Lately, however, it’s become fashionable to question this. Various Republican leaders have trotted out the idea of a flat tax, meaning a fixed percentage of income tax levied on everyone. And in their hearts they may be anxious to emulate Maggie Thatcher’s poll tax– a single amount that everyone must pay.

Isn’t that more fair? Shouldn’t everyone pay the same amount?

In a word– no. It’s not more fair; it’s appallingly unfair. Why? The rich should pay more taxes, because the rich get more from the government.

Consider defense, for example, which makes up 20% of the budget. Defending the country benefits everyone; but it benefits the rich more, because they have more to defend. It’s the same principle as insurance: if you have a bigger house or a fancier car, you pay more to insure it.

Social security payments, which make up another 20% of the budget, are dependent on income– if you’ve put more into the system, you get higher payments when you retire.

Investments in the nation’s infrastructure– transportation, education, research & development, energy, police subsidies, the courts, etc.– again are more useful the more you have. The interstates and airports benefit interstate commerce and people who can travel, not ghetto dwellers. Energy is used disproportionately by the rich and by industry.

As for public education, the better public schools are the ones attended by the moderately well off. The very well off ship their offspring off to private schools; but it is their companies that benefit from a well-educated public. (If you don’t think that’s a benefit, go start up an engineering firm, or even a factory, in El Salvador. Or Watts.)

The FDIC and the S&L bailout obviously most benefit investors and large depositors. A neat example: a smooth operator bought a failing S&L for 0 million, then received billion from the government to help resurrect it.

Beyond all this, the federal budget is top-heavy with corporate welfare. Counting tax breaks and expenditures, corporations and the rich snuffle up over 0 billion a year– compare that to the 00 budget, or the 6 billion spent on programs for the poor.

Where’s all that money go? There’s direct subsidies to agribusiness ( billion a year), to export companies, to maritime shippers, and to various industries– airlines, nuclear power companies, timber companies, mining companies, automakers, drug companies. There’s billions of dollars in military waste and fraud. And there’s untold billions in tax credits, deductions, and loopholes. Accelerated depreciation alone, for instance, is estimated to cost the Treasury billion a year– billions more than the mortgage interest deduction. (Which itself benefits the people with the biggest mortgages. But we should encourage home ownership, shouldn’t we? Well, Canada has no interest deduction, but has about the same rate of home ownership.)

How about social spending? Well, putting aside the merely religious consideration that the richest nation on the planet can well afford to lob a few farthings at the hungry, I’d argue that it’s social spending– the New Deal– that’s kept this country capitalistic. Tempting as it is for the rich to take all the wealth of a country, it’s really not wise to leave the poor with no stake in the system, and every reason to agitate for imposing a new system of their own. Think of social spending as insurance against violent revolution– and again, like any insurance, it’s of most benefit to those with the biggest boodle. (See also my page on whether welfare does any good).
Who gets to sit on the tax?
Come election season, Steve Forbes, among other millionaires, will be pushing plans for a flat tax. These proposals need to be absorbed with a carload of salt.

A plan where everyone’s taxes are lowered is of course simply a tax cut. Here, once again, the question to ask as a voter and citizen is, what government services do you want to cut? Somehow I don’t think Steve is proposing to slash corporate welfare or defense. It’s more likely a way to attempt to cut social spending through the back door. People like to hear about tax cuts; they don’t like to hear about service cuts, even though they’re financially equivalent.

A revenue-neutral plan won’t change total receipts any– it’ll just redistribute it. Here you have to ask, who gets shafted?

You can’t exactly make the poor pay more taxes– they don’t have the money. That leaves only one way to flatten the tax rates– that is, reduce the taxes the rich pay: soak the middle class. If tax rates go down on the rich, and we’re not cutting total taxes, the middle c
Nice try, Steel Magnolia, but the rich should pay more is EXACTLY what McCain said in the videos I posted.
Sunny So Cal–you’re the type of user who brings down Yahoo Answers. If you can’t bother to read the info *directly* related to thh question, then don’t waste all of our time with your non-answer. No one needs to read your whining about how your’re too lazy to be involved.
Also, Sunny So Cal, you don’t seem to know the meaning of "rant" either. Please go visit the Barney the Dino or Bob the Builder kiddie sites. Obviously more your speed.

Technorati Tags: airports, education research, el salv, engineering firm, family circus cartoon, ghetto, income tax, interstate commerce, interstates, maggie thatcher, offspring, poll tax, private schools, public education, republican leaders, s poll, social security, social security payments, subsidies, transportation education

Tags: airports, education research, el salv, engineering firm, family circus cartoon, ghetto, income tax, interstate commerce, interstates, maggie thatcher, offspring, poll tax, private schools, public education, republican leaders, s poll, social security, social security payments, subsidies, transportation education
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