People hate taxes. Rich people, poor people, republicans and democrats all hate taxes. For political reasons some blame it on greed and for political reasons some say it makes economic sense to hate taxes. The truth is that taxes are the only way we have to pay our government debts as they exist today. They ultimately pay for the borrowing required to fund all government programs. The more we borrow the more taxes will have to be raised to pay for the borrowing.
But if we want or need the government programs like stimulus and environmental regulation or cleanup or road building or unemployment compensation and all the other programs we crave, why is there such a political hatred for taxes? It isn't that the rich are greedy (those same people happily contribute billions to charity each year). And it isn’t really that we hate the concept of the programs those taxes support. For political reasons Democrats will say Republicans hate funding programs on education and for the poor, and for those same political reasons Republicans will say Democrats don’t want to pay for Defense programs or investment tax credits to help fund growth. But we all know that, but for the real reason we hate taxes, we would favor many, if not most, government programs.
The real reason we hate taxes so much is because government is so damn inefficient. We wouldn't contribute to government if it were a charity. Its administrative costs would boarder on criminal if it were a charity. A charity like habitat for humanity can buy land, build houses and provide them to deserving poor families in the time it takes for the government to get approval to put together a plan to potentially buy the same land that they then would give to a contractor who had political connection and who would build low quality houses and give them to people who were trying to cheat the system. And the charity can do it better for about one tenth the cost.
Government is also corrupt. This may be shocking to some and the corruption is certainly less obvious here than in many third world developing countries, but the idea that politics, relationships, contributions to political parties, and lobbyists have no bearing on the award of contracts or the distribution of benefits, is politically naive. They do and they always have. At the same time because of the inefficient and bureaucratic way Government acts, the best, highest quality contractors, goods and services are almost never chosen for any reason other than pure luck.
I live in California. That means my taxes border on 50% of my annual income if I am in the highest tax bracket. In other words the government complains and punishes me for "being rich" while at the same time it is my 50% silent partner siphoning off my money. Would anyone in their right mind give a partner 50% when the partner used about half of the money on itself and used the other half to inefficiently provide the services you thought you were going to get when you took them on at exorbitant, self serving prices, that are paid on the basis of political favors, nepotism and relationships without regard for quality? Of course not. That's why we hate taxes. I would gladly take that 50% and pay it to a number of charities across as many issues as necessary covering the poor, health care, environmental issues, labor, agriculture, education, you name it, if they were normal relatively efficient charities. Let's outsource the functions of government and mandate contributions to the outsourced charities. Get rid of big bloated inefficient inept government. I really resent working 25-30 or more hours a weak for the crap the government is giving me.
This is a great article. This really put into perspective why excessive taxation is wrong. I'm 18, looking to become gainfully employed and no one has ever really explained this to me before.
Posted by: Jack F | September 26, 2010 at 10:28 PM