Tuesday, September 6, 2011

Cut The Fat--Why Budget Cuts, Not Higher Taxes, Must Be Used To Balance The Budget

Numbers and figures here.

The money quote (pun intended):  Finally, to put everything in perspective, think about what would need to be done to erase the federal deficit this year: After everyone making more than $200,000/year has paid taxes, the IRS would need to take every single penny of disposable income they have left. Such an act would raise approximately $1.53 trillion.

That's right--to save the current nanny-state model, every person making $200K or more a year would have to turn over every cent of that income, to keep us revenue neutral!  That's on top of all the taxes already collected on everyone making less than $200K/year.  Putting every high-earning individual on welfare in order to support welfare is, well, insane.  It makes sense in a pure communist or pure socialist society, though practically speaking those societies do not function.

"Tax the rich!" is a common rallying call among left-wingers.  Well, the hard math shows in black and white that this is not a feasible solution.  Even if such an extreme tax policy as the one described above was passed, it would rapidly become unsustainable because of economic self-interest.  Many people who have high income have worked fairly hard for that privilege--physicians and lawyers sacrifice years of their lives for school and training; best-selling authors, actors, artists and star athletes have unique skill sets that they have honed over years; business entreupreners have often bet everything they have to guide a fledgling business through a brutish Darwinian environment to get to the point where they are successful.  Some high-paying jobs in the government/public sector seemingly do not involve the same degree of hard work, but these jobs are beyond my experience and I cannot voice anything more than a suspicion in that regard--I am certain that many people both in and out of government would disagree with that thought.

The point of the previous paragraph, however, is this--no rational person would undertake the sacrifices necessary to get a high-paying job if they will be no better off for it than an unemployed high school dropout.

American society rewards individuals who do more difficult jobs with higher income, in general.  Teaching is more difficult than garbage collecting, brain surgery requires more training than being a medical assistant, hitting 40 home runs in Major League Baseball is a rarer skill than being able to mix concrete.  I think that most anyone could agree with the assertions in the previous sentence, and anyone who is also a believer in the capitalist system, or any type of distributive justice that rewards in proportion to the difficulty of work or contribution to society as opposed to "from each according to his ablity, to each according to his need", cannot dispute the idea that it is indeed fair that some people make and keep more money than others.

The issue is that many liberals believe that Marxism is economic justice; which is a fundamentally un-American idea.  Marxism calls for equality of outcome; the founding American tradition calls for equality of opportunity (yes, yes, spare me that the Founding Fathers allowed slavery--there was the idea of equality for all citizens from the outset, and happily the definition of citizen has been expanded over the past 235 years).  The person with a strong work ethic or specialized talent or skill will always prefer equal opportunity, because it offers them opportunity for advancement regardless of the rest of the population.  In equal outcomes, one can only improve their standing if the population as a whole has a net improvement large enough to make a significant impact for everyone.  Realizing that the world will never be perfect, in terms of self-interest alone anyone who wishes to advance himself should advocate for equality of opportunity; only the shiftless and the unemployable should favor equality of outcome.  Those who are unemployable for existential reasons (medical conditions, for example) do deserve sympathy and a degree of largesse to allow for a comfortable life, and this is not incompatible with capitalism--but to condemn a Warren Buffet for having a more luxurious lifestyle than someone who chooses not to work or an individual paralyzed by muscular dystrophy is foolish, and to confiscate his wealth in a disproportionate manner to subsidzie others above and beyond bare essentials is unfair.

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