Week of 04/08/2013

Tax Extremism Needs To Go For Tax Reform To Begin
– by David Matthews 2

“Taxation is Theft!”

“No New Taxes!”

“Taxed Enough Already!”

It’s hard to talk about the subject of tax reform without coming across some mind-numbed conservative or neo-conservative throwing a teabag-stapled hat on like they are Minnie Pearl and spouting off bumper sticker platitudes about how people are being taxed to death and how it’s all President Obama’s fault and the only way things will be better is if taxes are slashed to the bone and tax breaks are given like they were papal indulgences. 

These conservatives and neo-conservatives are tax extremists.  To them, any kind of tax is “wrong”.  It doesn’t matter if it’s a new tax, an old tax, a tax break that is scheduled to expire, or a tax loophole that should have been closed, if it adds so much as one quarter-penny to the tax coffers, these extremists scream bloody murder and demand it be put to a stop.

“We don’t have a revenue problem,” they arrogantly proclaim, “we have a spending problem!”

Actually we have a hypocrisy problem, considering this is the same political faction that drove us into two wars to be paid for on credit, and only one of them was a matter of necessity.  You see, spending is never a “problem” as long as it is for the things that they want the money spent on, like wars and police-state activities.  But once they are out of power, then any kind of revenue and spending becomes a “problem”.

That’s why we really have a hypocrisy problem rather than a “spending” problem.  The people that are bitching about spending are only bitching about it because it’s not the stuff they want spent.  Should they ever get back in power, they’ll proclaim the problem “contained” and then spend that same tax money on the stuff that they want spent.  If you don’t believe me, then just think back ten years as to which group was doing the spending and on what.

But this hypocritical tax extremism affects us in more ways that just the current political morass.  It also prevents us from coming up with ways to fix the tax system we have.

Yes, our system of taxation is messed up.  It has been twisted and used by politicians to favor their special interest friends so they can pay nothing in taxes and continuing to build on the debt that these tax extremists continue to hysterically scream bloody murder over.

Is it right that a big corporation like General Electric manages to virtually pay nothing in U.S. corporate taxes, leaving the burden to fall on smaller companies?  No.

But good luck trying to close the loopholes and exemptions that allow that to happen!  As soon as you even hint at doing so, the tax extremists scream “Unfair!” and order their friends in Congress to kill any such idea.

Well how about starting from scratch and coming up with a new tax system where everyone pays without exception?  No good.  Be it a “flat tax” or a “Fairtax”, these ideas are quickly dismissed as being “impossible” or “impractical”.

So let’s recap here… these tax extremists think that the current system of taxation is “unfair”, that the American people are taxed too much already, that removing any kind of tax break or tax exemption even through its own scheduled expiration date is a “tax increase”, that the government should not get one additional penny in tax revenue, and apparently they are not really interested in fixing the tax system itself.

Fueling this extremism is this myth that cutting taxes would somehow result in economic growth, which would get more tax revenue through more people working and being promoted.  This is a myth, though, because it presumes that big businesses would take the savings from a tax cut and put it into expansion and promotion and hiring.  This is the old theory of the 1980’s and 90’s, but one that did not happen in the 2000’s, when tax cuts were given, profits soared, but real wages for employees stagnated.  The theory presumes that the companies won’t outsource their workforce to third world nations, or that they won’t simply keep the profits and pay their chief executives obscene amounts of money.  In other words, the very things that Big Corporate did in the previous decade.

Don’t you hate it when the world just doesn’t work according to script?

Let’s get brutally honest here… we cannot resolve the tax problem until we remove the tax extremists from the equation.  It is clear they don’t want to be part of the solution and are only interested in keeping the dysfunctional status quo going.  That’s not progress… that’s sabotage.

It’s funny how the United States managed to survive and thrive forty years ago when the highest tax rate was at ninety percent, and yet today’s tax extremists are throwing temper tantrums when that same highest tax rate is a little over one-third that.  How did the rich keep getting richer back then?  Well, we know how… tax breaks and tax exemptions and tax shelters.  As Leona Helmsley once reportedly said, “Only the little people pay taxes”.

We need to modify this extremist mindset when it comes to taxes.  Taxes, like the government it funds, are a necessary evil.  Needed but not wanted.  You want your ego-driven wars?  You want your ego-driven domestic crusades?  You want to keep that “Lone World Superpower” mindset going?  Then you need to pay for it.  You.  Yes, you.

And if you don’t like the current tax system, then come up with a better one, or throw your support behind one that you believe would be better, and keep supporting that better system until it becomes reality.  Coming up with tax cuts and tax breaks and tax shelters and tax exemptions and then screaming bloody murder if anyone dares mess with them does not fix the problem.  It only makes the problem worse. 

Bumper-sticker slogans on taxes are not solutions.  They are simple-minded sales pitches that reflect the simple-minded hypocrites that expect government to work only for them… and only for free.