The Wealthy and Politicians Don't Like Paying Taxes

Yahoo - CNBC - The rich pay all the taxes. That is the headline of an article by CNBC, there is a video or their report included in the link. Those poor rich people, don't you feel sorry for them.

According to a government report the top earners pay for all the taxes and people in the bottom 40% receive more in government benefits then they pay out, this is presented as outrageous; but, it is also very misleading. Lets start with some basics. According to this report, the lowest income group, the bottom 20%, made $8,100; but, received $25,000 in "transfers". Huh? I know people who made under $8,100 and the government did not send them $25,000. Oh, wait are they including the unemployed or people on Social Security? I bet they are and lets consider that. We all contribute to unemployment insurance and social security and that money is paid to the government, when receive it, it is not charity. If you pay into social security for 40 years, when you finally get it back it is not coming from the tax on "the wealthy".

As income inequality has grown I am reading and seeing more and more from "libertarians" and financial media whining that they shouldn't have to pay taxes. We hear repeated all over the news when they talk about the "job creators" and it is still a lie. If they were really sincere then they would asked to be taxed based upon the number of full time jobs they created in the United States. Maybe that doesn't work for the wealthy because they certainly haven't created any jobs recently. In fact, we have lost millions of jobs because of the fraud and abuse that was allowed to go on in Wall Street and by banks which eventually led to our recession. Why don't we call them job exporters instead because most of the jobs that have been created in the past few years were jobs that these same people outsourced to China and India.

I have talked about some of this before. Personally, I am in favor of a flat income tax, everyone pays 10% or whatever percent of their income regardless of how it is derived, no deductions. It is slightly more complicated than that; but, not much. I don't want to tax people on welfare income because that then just becomes a paper chase. If hand you a dollar and make you hand me ten cents back, doesn't it make more sense just to hand you 90 cents in the first place. The same should be applied to military pay.

Some people don't like income tax and prefer a sales tax. I have a couple of problems with that. The most important one is very simple again, I want to tax people based on how they have benefited from the nation. We have built a lot of infrastructure and business relies on that infrastructure. Instead we give tax breaks to companies. Those breaks don't show up in the income tax report done by the Congressional Budget Office.

We are seeing this game end for America and the West. We have given away our industrial base and debased our currencies. After the financial crisis, the pie got smaller. The cost of that crisis was all born by the bottom 60% us. The only winners were the top 10%. From the beginning this blog has talked about the financial crisis, what led to it and where it is heading next. I don't know why this information is less read; but, in many ways it is the most critical to our immediate future. Next year should be really interesting.