Taxation

Any way you look at it, taxes are functionally the same as protection racket payments. When you pay taxes, you are paying someone else to protect your assets. When you pay the "Mob", you pay to protect your assets from the "Mob" and its competitors. When you pay the government, you pay to protect them from a larger variety of hazards, including those same criminals, as well as natural and man-made disasters, and ignorance, just to name a few.

You also to pay for protection of the common assets; i.e., those that belong to all of us. You know... life, liberty, the pursuit of happiness, and all that.

Every existing system of taxation inspires a set of opponents, nominally referred to as reformers, who perceive that they are getting the short, dirty end of the stick, and want to change things to reflect their perception of what constitutes improvement. There are many different kinds of tax systems, and all of them have their benefits and pitfalls.

In the beginning, the US tax system amounted to a head tax, mandated by the Constitution. Every state government paid into the Federal coffers according to the population of the state - hence the establishment of the US Census. It was up to the states to figure out how to raise the money, and it wasn't optional. To raise that money, the individual states implemented a variety of systems for collecting revenues, and they were not consistent, nor were they often fair to individual citizens.

Following one of the wars, Congress realized that the existing system for raising funds was too slow to be effective... sometimes you have to round up entire state legislatures and jail them in order to get the money. So they offered an amendment to the Constitution, which allowed the Federal government to tax individuals directly, The several states breathed a collective sigh of relief (because now they don't have to do the dirty work), and ratified it. A system had to be developed and implemented. That system is what has evolved into today's tax system. Believe it or not, there is a rationale for much of the structure of that tax system. If you think about it rationally (see the first paragraph), people with more assets to protect, place a higher demand on the protection services available from government, and thus should shoulder a larger share of the tax burden (sounds a bit like Reagan's user fees...). This is called a progressive tax, in legal-eze. People with few or no assets have little or nothing to protect, and thus should pay little or no taxes for their protection.

Our claim to be a Christian Society (see all of the radical right political rhetoric!) is pure hypocrisy if we don't recognize the fact that it takes a certain minimum amount of income in order to simply live, not even allowing for prosperity, thus the concept of a minimum taxable income is born. The problem with the concept is that the minimums established by Congress were never really enough to live on.

The Flat Tax is a popular bandwagon among reformers. The basic philosophy of a flat tax, is that everyone, without regard to any other factor, pays a fixed percentage of income, and supposedly no deductions are allowed. Most proponents of this method of taxation labor under the illusion that taxes would be in the neighborhood of 12-14%. Objective studies place the number at closer to 25-27%, and raise the point that the major beneficiaries of the change would be the wealthy.

They also point out that unless the process were fixed in a Constitutional amendment, elected officials would still be able to provide their friends and supporters with income exemptions.

In reviewing the facts surrounding the so-called Fair Tax, (let's call it what it really is, a national sales tax!) provided at the FairTax.org site I found only the same tired, old, erroneous contentions that never held up to truly analytical scrutiny anyway.

First, the basis for the claim to "fairness" is the contention that "people that pay no taxes now will be paying at least some." This is a pollyanna position if ever I saw one. The very very rich pay little or no taxes because, at least on paper, they have no income. Every consumer tax proposal ever fielded contains provisos for eliminating taxes on corporations, because they "provide jobs and stimulate the economy." Never mind that the jobs they provide are all in Mexico and India, and the only American economy they stimulate is their own corporate bank accounts.

They also ignore the fact that the rich are not consumers in any traditional sense. They use their corporate and tax-exempt family assets to do their consuming. Guess what! Those corporate and family assets won't be paying your "Fair Tax!" So who will be?

You will be.

And your 76-year-old mother, who lives on a few hundred a month from Social Security will be.

And the Gulf War widow with three children, two of whom may be in diapers, living on next to nothing will be.

And don't forget about retirees who are living on savings, for which TAXES HAVE ALREADY BEEN PAID! They're going to pay again on the same income, when they spend those savings. I could go on and on. Who won't be?

The Bushes.

The Cheneys.

The wealthy leaders of the Republican and Libertarian parties, along with anyone else who can hide their consumption in some form of "economic engine."

And how much will we who are left be paying? Ever notice that every alternate tax proposal every flown seems to get assigned a value of 10-15% of income? That is pure bullshit! Even the Republican think-tanks now admit (off camera) that the number will be more like 24-29%!

Think about this - if I only earn a gross income of $20K-$30K/year, and it takes all of it for me to just provide food, shelter, and clothing for my family, where is the additional $5K-$9K for paying your "Fair Tax" going to come from? Am I supposed to eject one of every four of my family so that I can support the rest?

It's more likely that I'll start patronizing an underground economy where no sales taxes are paid. And don't think I can't, because we all know that economy already exists. The ever-lauded entrepreneurs who run the small businesses which provide so many [poverty-level] jobs have been using it for literally thousands of years. It's called the cash economy. The "Fair Tax" isn't going to tap that consumption. Instead, it's going to tap your purchases at Wal-Mart, Kroger, Publix, and even the rent you pay to your landlord, and it's not going to care that you don't have enough left to live on.

Every tax reform proposal ever floated claims that it would eliminate the IRS. That's bullshit too. The IRS exists for one reason only: to implement and enforce *whatever* system of taxation is in place. You can change the name. You can fire the people who work there (even though you'll have to hire them back). You can do all kinds of things that make it look like they went away, but the job will still be there, and there will still be someone who has to do it! If anything their ranks would have to swell even more, just in order to enforce collections and reporting of collections, under the "Fair Tax."

Taxation evolves the way it does for the benefit of the same group for which all societal change evolves: the very rich. Any benefit derived of such change for the remainder of society is either coincidental or guilt-driven. There is no doubt that our current tax system is overdue for replacement, but if the "UN-Fair Tax" is the next step in the evolution of our tax system, the future of this country is bleak.

Mariner