Monday 1 November 2010

Flat Taxes Cannot Be Fair

Most decent people I know argue against progressive taxes. Every normal person can see progressive taxes are grossly unfair and make no sense whatsoever economically. They are just a simple way for the Lefties to punish the successful for being successful. And the astronomically rich can get around this anyway (Steve Jobs has a $1 annual salary from his company, Apple). The policy is harshest on small business owners, people who make between $200,000 and $1,000,000 a year. These people make enough money to be taxed in the most cruel way, but are not rich enough to contribute the trillions the government is spending. They do not earn millions and are being prevented from expanding and growing their business. Progressive taxes also induce malinvestments and lower incentives to save.
Now - what is a proposed solution to this obvious problem? According to most people I know - a flat tax! A flat tax would be 'fair'. It would mean everyone pays the same proportion of their income to the government for 'the greater good of all'. However, this attitude puzzles me considerably. In a country where the flat tax is 10%, if one person makes $10,000 and another $100,000, then the first will pay just $1000 in taxes while the latter will have to fork over $10,000! This is clearly not 'everyone pulling their own weight' as flat tax promoters argue, but rather another way of redistributing wealth. Both the richer and the poorer person receive the same services from the government, so why should one be forced to pay more for them? When I go to McDonald's no one asks me how much money I make. A cheeseburger costs me $1 whether I'm a poor farm labourer or a Wall Street CEO. So why should government services cost the Wall Street CEO more? They shouldn't! Government needs to be restructured so that taxes are replaced by fees. Fees people can opt out of paying if the wish. Everyone paying a public education fee is being robbed of their money unless they have children in public schools (in which case they are robbing everyone who doesn't). Everyone who doesn't smoke is being robbed by the government who gives their tax money to tobacco growers. The list of abuses is endless.
How about we just get rid of this entire sick machinery of exploitation and return to normalcy, the days when democracy and 'the people' didn't rule over us as tyrants.

John Adams was right when he said that democracy is the most bloody system of government and that it cannot last. It cannot last because "...it soon wastes, exhausts, and murders itself. There never was a democracy yet that did not commit suicide". And how exactly does a political system murder itself? To put it simply - by taxing itself to death.

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