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Tuesday, October 28, 2008

Obama Raises a Red Flag

Barack Obama's Marxist "spread the wealth" talk should be a big red flag to all the freedom-loving red-white-and-blue Americans out there.

From our friends at Americans for Limited Government.


Braden said...

This gets back to the progressive tax issue, which oddly enough, was proposed by one of the earliest proponents of capitalism, not communism.

"The necessaries of life occasion the great expense of the poor. They find it difficult to get food, and the greater part of their little revenue is spent in getting it. The luxuries and vanities of life occasion the principal expense of the rich, and a magnificent house embellishes and sets off to the best advantage all the other luxuries and vanities which they possess. A tax upon house-rents, therefore, would in general fall heaviest upon the rich; and in this sort of inequality there would not, perhaps, be anything very unreasonable. It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion."
-Adam Smith, The Wealth of Nations

There is no reasonable man who can say that a 10% tax rate on someone with $10 is as fair as that same rate on someone who has $1 million. The poor man has no dispensible income, the rich man has tons.

If progressive taxation truly is Marxism, as you say, then Marxism is nothing new in this country. The vast majority of politicians and economists favor a progressive tax system, and we have had one for most of the 20th Century. If progressive taxation is communism, then the United States has been a communist country for quite some time. Barack Obama returning the tax code to that of the 90's would be nothing new.

I could be wrong, but I don't think you believe this country is a communist one. Why then do you believe Obama is a Marxist, when his tax policy is nothing new? If this country has had communist principles for many years, why would Obama's be a red flag?

I find it especially interesting that Republicans are the ones making this charge since their president, Comrade Bush, has presided over the largest government takeover of private companies in US history. But it's Barack Obama, not him, who is the socialist.

Bob Ellis said...

You've been reading the liberal talking points again.

Smith was talking about the necessities of life, such as housing, and the taxation of such. As he mentions, housing comes in great varieties of size, luxury and extravagance. The value of such homes is obviously more than a basic no-frills home, just as the value of a Cadillac is higher than a Chevy. It makes some sense that the more luxurious, more valuable commodity be taxed at a higher rate.

What Obama is talking about is taxing income at a higher rate. Income is not a purchase, but a property, one which is earned by trading one's hard work in exchange for this property.

He is talking about penalizing success and profit. The implication is that there is something immoral about having more wealth than specified amount. There isn't. Love of money can be immoral; the wealth it self is not.

Dispensable income is irrelevant to an income tax. Your insistence that it be considered relevance is born of envy of that dispensable income and greed to have some of it. It's none of your business (and none of mine, either) how much money another person makes, and it's none of my business (or the government's), how much dispensable income they have, and no one else is entitled to any of it. They didn't earn it, so they have no claim on it. It is the property of the person who earned it.

I simply do not understand how you can morally justify taking another person's property and giving it to another person. But then, perhaps moral justification is irrelevant in the liberal mind.

It is true that Marxism is not new to the United States. We've seen it come and increase over the past 100 years, exploding under FDR and LBJ. Reagan managed to beat a lot of that back, but we've swung back the other way since he left office.

And Barack Obama would undoubtedly foster another massive explosion of Marxism. Where every other liberal president (and most congressmen) have carefully hidden it and watched their language to hide their affection for Marxism, Obama has been talking more-or-less openly about it for years. If he feels strongly enough about it to actually talk about it in the open, he will certainly push it unabashedly in the White House.

You are right to point out President Bush's support of a government takeover of a large chunk of the financial industry. It's pathetic and shameful.

But Obama has made it obvious that he would make Bush's dabbling with socialism pale in comparison, given the chance.

No economic system is perfect, including capitalism. However, when freedom and equality of opportunity are provided by government--which they are--then it is the best system ever devised for "spreading the wealth" and creating prosperity. And the wealth is spread not by a bloated, inefficient, centralized government agency, but by free market forces, creativity and hard work. It provides a built-in incentive to work hard and develop a good work ethic, while also providing a built-in penalty for sloth, a poor work ethic and counterproductive lifestyle choices.

Human nature being what it is, it is the absolute best system for helping everyone meet their needs and live a comfortable life, while rewarding those who choose to work extra hard, take risks for the sake of enterprise, and leverage their creativity for the good of society.

If we are to survive as a strong nation and a free people, we must immediately turn back toward limited government and a free market--not head over the cliff of Marxism and state control as Obama is intent upon.

Braden said...

I think you're missing the most important point from Smith. "It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion."

Progressive taxation is based on the concept that the wealthy have benefitted most from society, therefore they should contribute the most to maintain it. The roads and schools the government has built and the military it maintains have allowed them to get wealthy. They have alot to lose, and without the government, they could lose all of it. The very poor, on the other hand, have benefitted little from society. Therefore, they shouldn't pay as much to maintain it. They do not have as much to lose. Those who society has helped to prosper, should pay the most to help maintain it.

We also shouldn't oversimplify this issue. Many poor people are not poor because they don't work hard, and many rich people are not rich because they did. There are poor people who have never worked a day in their life, and there are poor people who work 3 jobs a day. There are millionaires who have worked their whole life to be where they are, and there are millionaires born into it who have never worked a day in their life.

The point I'm trying to make is that most poor people are not poor because they refuse to work. Capitalism REQUIRES poor people. In an economy, there is only so much money to go around. If someone is going to become rich, someone else is going to have to become poor. A capitalist society will always have poor people. The problem arises when a few rich people become super rich. They begin to take up more and more of the total money available. How can they do this? Because they were already rich, they have the money to spend in new business ventures.

The super rich should pay more than their fair share of taxes, because the current society has enabled them to become super rich. They get the most benefit, they should have to pay the most. Why should a single mother working 3 jobs pay the same tax rate as them when the current society has provide her far, far less benefit? Why should she have to pay to maintain it? Why should she want to?

Bob Ellis said...

I think you're still missing the overriding point: private charity is a great thing; forced charity mandated by the government is bad for the source and the destination of that "charity."

The wealthy have indeed benefited by society...but they did not do so in a pillow-festooned vacuum. They benefited because they worked hard, took risks, used their creativity and generated wealth for themselves--and usually generated wealth for others at the same time.

Without the evil rich folks who worked hard and took these risks to start companies, etc., there wouldn't be the jobs the rest of us depend on for our wealth. It is proper and fitting that if you put in more effort (and most successful people would laugh at a 40-hour week--their week is usually 60 to 80 or more hours). Many of them also risked their capital, their credit rating, and their credibility to start a business. They deserve to see a larger payoff for that investment.

And guess what: they almost always do give back far more than anyone else to society. Not just in the jobs and economic prosperity they create for others and for the country, but in more taxes and philanthropic giving.

As it stands now, the top 10% of earners pay about 70% of the taxes. My goodness, I don't have words without resorting to profanity to express how incredibly selfish, ungrateful, envious and vindictive it is to have the audacity to suggest they carry even more of the burden.

Even if we had a fair and equitable tax system where everyone paid the same percentage, they would still pay more into the pot; 10% of $5 million=$500,000 whereas 10% of $50,000=$5,000. The rich guy still paid in a lot more than the guy making $50,000.

What's more, America is a very generous and giving country. The Index of Global Philanthropy shows that in 2006, private philanthropy accounted for $11 billion more than the U.S. government gave in foreign charitable aid. The next most charitable nation--the UK-- gave less than 10x less than the U.S. And Americans give just as generously--perhaps more--here at home for all sorts of efforts ranging from homeless shelters to soup kitchens to Backpacks for Kids to crisis pregnancy centers to an almost endless list of charitable efforts. Even a capitalism-embracing, personal-responsibility-preaching guy like me gave more last year than Joe Biden has in the last 10 years combined. My charitable giving was also more each year than the Obamas gave each year between 2000 and 2004. And I make way, way less than either Biden or Obama. I'm not saying this to pat myself on the back; just to say that even average Americans are far more generous than the likes of Marxists like Biden or Obama give them credit for.

You're right that we shouldn't oversimplify the issue...but we shouldn't over complicate it, either. There are some hard-working poor folks, as there are some slothful rich folks. But they are the exception. And that status is usually based on the choices they have made, not on some imaginary injustice.

I grew up poor--poorer than most people today would care to think about. We were poor because my dad chose the life of a small farmer. It's darn hard to make a living as a small farmer, no matter how much effort you put into it. But that's the choice he made. Nobody forced him to be a small farmer. No caste system or oppressive overlord denied him other opportunities or locked him into that. It was a choice he made. And he eventually realized in my late teens that it wasn't going to get any better...and he went into something else and made a better living. You can do that in a wonderful, free country like America.

But I also knew plenty of people growing up--several in my own extended family--who were perfectly capable of making a comfortable living, but instead chose to live off welfare because they were too lazy to hit a lick at a snake. Other people's money was taken from them and given to these people who could always find some excuse not to work.

I have also worked with a few poverty ministries as an adult. And in most cases, the poverty is a result of poor work ethic and bad lifestyle choices. If you show up late all the time, or don't even show up at all for work some days, guess what: you're not going to rope a great-paying job (if you keep a job at all). And if you'd rather stay out gambling instead of going to work, you're not going to have money or job for long. Same with drinking and drug abuse. And sex outside of marriage that results in children before the parent(s) are financially ready for children tends to limit educational opportunities, along with occupational mobility and choice...but then, the choice was theirs to put their future on the line with a tumble in the sack.

And private charities can try to help many people, teach a better work ethic or help them leave behind the counterproductive lifestyle choices...but as long as government "charity" is there to bail them out, there is little incentive to change. And most refuse to.

There will always be various income levels in our society; there will always be those who are driven to excel, as there will always be those who refuse to do more than they have to in order to barely subsist, and there will always be those in the middle who want to make a comfortable living without the back-breaking effort and risk invested by the wealthy.

But in America, we have that choice. We can create our own destiny based on the choices we make and the effort we want to expend. And all the occupational and economic strata will be filled.

But it is a mistake to subsidize and incentivize sloth and bad choices. And it is government-sanctioned theft to take the property of one person against their will and give it to another who hasn't earned it. It runs counter to the core principles of Americanism.

Dr. Theo said...

Very well said, Mr. Ellis.

I'd like to add a word or two in response to Braden's comments. He argues that wealthy individuals became that way because they benefit disproportionately of government services. I totally disagree. Well-over 80% of police, ambulance and fire calls come from lower socio-economic groups. Municipal social services are in place almost exclusively for the "poor." Food stamps, WIC, free school lunches, free immunizations are only for the "poor." Medicaid, which has become the largest part of the budget in many states, is exclusively for the lower 50% of citizens. Medicare and Social Security are stacked against the top taxpayers because they will never get back anything close to what they have paid in. Besides, wealthy people are, on the whole, healthier that poor people because they have made wiser choices in their lives.

The wealthy pay enormous amounts in property taxes yet use few of the services and are much more likely to send their kids to private schools, or to home-school, thus take little benefit from all the money poured into the sink-hole of public education.

I can see not particular benefit of roads and utilities that favor the rich. The poor drive automobiles at nearly the same rate as the rich.

Braden also alludes to a fixed economy in which one person becomes wealthy only by making another man poor. This is Marxist thinking and can be shown to be a fallacy. The economy can be grown and everyone can benefit. If I invent a widget that makes everyone's life a little easier and more prosperous, I employ thousands to produce, market and distribute this item, and I get rich in the process, who has gotten poorer? Bill Gates produced thousands of millionaires. Was this money taken unwillingly from the labor of the poor?

The economic pie can get bigger and bigger benefiting us all, but government intervention, besides demanding their own significant piece of the pie, impedes the freedom, risk-taking and entrepreneurship that is necessary for growth.

Bob Ellis said...

More excellent points, Dr. Theo.


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