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| Midnight |
And like
Midnight, there are people in this country that have an insatiable hunger for
tax money. They want more taxes
continuously. They spend time thinking
of new ways to get it. They make
emotional pleas for it. At times, like
Midnight, they even beg for it.
They are “Tax
Zombies” who seek to bite open your wallets and eat up all the cash. They exist both inside and outside of
government. A commentary in last week’s New York Times argued that higher taxes
are the solution to all our problems.
But how much
taxes would be enough for the Tax Zombies?
Just like Midnight and food, I don’t think there are enough taxes to satisfy
them. They would just develop more and more programs and more and more ways to
spend the money and then ask for more.
It’s like a spendaholic with a credit card. No credit limit is high enough because they
will always spend all the available funds and then want more.
If allowed,
the Tax Zombies would take every dollar you earn and then give some it back in
food stamps, housing allowance, and other credits. Therefore the power to tax is the power to
control. The more you are taxed, the
less freedom you have. An increase in
taxes results in a decrease in freedom.
Some taxes are necessary, but nations that figure out how to provide “Public
Goods” with the lowest tax rates are rewarded with stronger economies. Remember that every dollar removed from the
private sector in taxes is one less dollar available to fuel economic
expansion. Higher taxes will not solve
all our problems – it is the problem.
The
Affordable Care Act (aka Obamacare) includes 21 new taxes or increases (7
hitting the “non-rich”). This is
expected in order to be able to cover people who are currently uninsured. But the problem is how government will manage
your tax “contribution”. Fraud is so
rampant in Medicare that it can’t even be accurately estimated. A sample audit found fraud at over 30% in one
location. There will be much fraud with
the government managing the ACA and this is not factored into the cost
estimates. This means the ACA, even if
the costs estimates are accurate (and you know they are too low), the program
will cost 25-30% more due to fraud.
After you make promises to people and you come up short on funds, how
are you ever going to pay for it? Here come
the Tax Zombies again!
Both Illinois
and California have huge deficits because they spent way more money than they
collected in taxes. The solution? Even
though they already have very high tax rates, both states plan to raise taxes
even higher. The Tax Zombies strike
again! My friend Mike just ran (moved) across the border to Indiana to avoid the
monsters.
Our enormous
tax code is composed of thousands of ways for the Tax Zombies to get your money
and thousands of ways you try to keep ahold of it. We are in dire need for tax reform because running
and hiding from the Tax Zombies results in too much cost and inefficient use of
resources.
Economic
theory says that collective money (taxes) is necessary to pay for public goods
(roads, bridges, security forces, education, etc.) But the government didn’t create these, it
merely manages the process. (Think about it, the government didn’t build the
bridge, a private construction company did)
And when you factor in the fraud and inefficiencies of government
processes, it manages your tax money very poorly.
The government
cannot generate any revenue on its own, it is dependent on taxes and fees) collected
from people who earned income in jobs that were created by entrepreneurs who
took personal risks. These business
owners also paid corporate and personal taxes along the way. So what about those “ungrateful” business
owners? Because of their successful
efforts they created jobs that provided the tax money for the “Public Goods” to
be produced. Yes they did build their businesses and they helped build those
roads and bridges too.
