Taxing Others

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During the height of the Soviet Union, a party adherent says to the party leader, “I love the party so much.  If I had two homes, I would give one of these homes to the party.  If I had two cars, I would give the second to the government and party.”  The party leader then said, “What if you had two chickens?”  The adherent responded, “I don’t have a second car or a second home.  I do have two chickens.”

(Thanks to Rabbi Mordy Einbinder for the above story.)

Several years ago, there was a “millionaire’s tax” on the California ballot.  The majority of Californians voted to tax others, those making a million or more, to pay for mental health services in the state.

This year, Californians also voted for Proposition 30 to institute an additional income tax for those who are wealthy, those who make more than $250,000 per year.  Again, this passed.

President Obama wants to increase the taxes also of those earning $250,000 a year.  He claims that he holds a mandate to raise more taxes as he outlined that he would indeed take such action.  There is probably more than 50% of the population who support this tax increase.  After all, it does not apply to them.  Balance the budget, but do so on the backs of others!  So the majority of voters basically approve this tax on others.

The University of California needs money.  Tax the wealthy.  The California State University needs money.  Tax the wealthy.  The Community Colleges need money.  Tax the wealthy.  Schools need funds.  Tax the wealthy.  The U.S. budget needs to resolve the debt problem.  Tax the wealthy.  You can tax the entire incomes of the wealthy and there would still be a budget debt.

Those who oppose these taxes argue that this tax impacts the “job creators.”  They argue that there will fewer jobs if these taxes pass.

But that is not the issue.

There will still be a budget crisis with the passing of Proposition 30.  The money that this proposition will bring in has already been spent.

Do you really think that additional taxes on the 2% of those making more than $250,000 will solve the budget crisis?  The money that will be raised through the imposition of such taxes will not equal one year of debt.  There will still be a debt crisis.

Tax “fairness” does not require the full burden to fall on 2%.  Tax fairness requires that everyone has a stake in the taxes.  We have a progressive system of taxes.  More of the burden will fall on the 2%, but 98% of the people totally escaping the tax is patently unfair.  It is an easy political solution to just tax the 2%.  But the scope of the debt problem requires something more than political expediency.

Do we really want China potentially controlling our economy as they buy up our debt?  Do we want our children each owing $50,000 or more in debt each to the federal government?  Do we really want a budget in which all of the monies received go to the elderly to subsidize Medicare, with no money for education, to serve the disabled, or for the many other beneficial items in the state and federal budgets?

The Simpson-Bowles Commission argued that something bigger was needed.  Instituting taxes on everyone was part of the solution, as were various budgetary cuts.  The Simpson-Bowles Commission may not in the end be the solution, but it is fairer and brings about a bigger fix than simply taxing the 2%.

We need to face our obligations.  We need to establish clear budgetary objectives in this age of too little to support our government.

We need to have 100% involved in the solution.  We will still we have a progressive tax system in which the rich pay more than the poor.  But we cannot get a complete solution just by taxing the 2%.   This is a problem for the 100% of us.

                                   Robert J. Rome, Ph.D., is a licensed psychologist in clinical practice in Encino, California.  He can be reached at RJRome@aol.com

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