Poor, poor rich people

First Things is usually a good web site, but sometimes they write things that baffle me, like this recent post on how our taxes are so unfair to rich people.

That’s right. Nearly half the country pays nothing* towards a government that in theory represents everyone. A family of four earning $50,000 pays nothing in federal income taxes. Nearly 40 percent of those 47 percent actually profit from the tax system, getting back in credits more than they would have owed. They’re actually paid to not pay taxes!

Politicians of both parties going back decades share the blame for this. They promise something for nothing to taxpayers to get their votes, then try to make up the difference by higher taxes on the “rich” or by borrowing the money. (The top 10 percent of earners pay 73 percent of the taxes, but realize that “rich” starts at $366,000 in earnings, and some of them are actually small businesses that file taxes as individuals.) We constantly hear pleas for the “rich” to pay their “fair share,” but that’s a mighty weird definition of “fair” if in reality it means the lion’s share. Besides, we can raise taxes on the “rich” to levels unseen in decades and still not make a dent in the federal deficit.

First, that family of four living on $50,000 is raising two children.  One might think that this is contributing to the common wealth.

Second, could it be that those top 10% paying 73% of the taxes has something to do with how much money they make relative to the other 90%.   To take an extreme case, if all the nation’s wealth was owned by one person, would it be unfair for him to pay more in taxes than everyone else?  (In fact, commenters on that post claim that this top 10% make 60% of the nation’s income, so paying 73% of the taxes is hardly iniquitous to them.  In fact, it sounds far too small.  I think it would be more fair to compare tax rates not with total income, but with disposable income.  By this measure, it would be obviously unfair how little that top 10% is paying.)

Third, I don’t know what circles Neven runs in, but yes, $366,000 is rich.  It’s very rich.  I don’t think I’ve ever met anyone who makes that much money.  I make $60,000 a year (plus summer salary from my grant), and I’m well-off.

When someone writes something so stupid, I imagine there must be something going on in his head that I’m not seeing.  I expect it’s part of that big political deal that defines the Republican Party.  Christian conservatives agree to let the party define itself entirely by the self-interests of the wealthy, and in return the rich condescend to associate with us (but never, of course, actually push for our agenda).  Astoundingly, the business interests in the Republican Party actually think they’re doing us a favor by letting us stay in and repeat their idiotic ideas.  But there’s something every Christian reactionary needs to know:  the rich hate us.  They absolutely despise us, and they’re not shy about saying it.  To a man, they are enthusiasts for abortion, pornography, gay “marriage”, atheist indoctrination in schools, multiculturalism, and culture-smashing levels of immigration.  Ask yourself:  where is the foundation money going to patriarchist causes?  How many successful entrepreneurs are using their fortunes to support missionary work?  Compare that with how many are giving their money to Planned Parenthood or sodomy-advocacy in schools.    Our loyalty has bought us nothing.  I hope the bastards are taxed into oblivion.

23 Responses

  1. Hallelujah, brother. The pro-rich apologists crack me up when they talk about “unfair” confiscation or whatever.

    Do they talk about the unfair confiscation of profits from the workers who are actually doing the work? Oh no, heaven forbid!

    When the parasite, ehem, I mean “investor” class gets to set around all day doing nothing, while tremendous wealth accumulates in their bank acount… Why that is just the “free market” at work!

    The hypocrisy is astounding. Unfortunately, Libertarian analysis and terminology has been co-opted to support this monstrosity of an economic system. It serves to confuse and obfuscates the issue for many young people.

    A “hands-off” economic theory is exactly what the rich want… AFTER they have already fixed the rules of the game to their perpetual benefit.

  2. “When someone writes something so stupid…”

    You forgot to tell us what was stupid. Is it that the wealthy pay more than their proportional allotment of their income (vs. the un-wealthy) in taxes? It seems to me that given an income tax, amount paid should be proportional to wealth generated, comparatively.

    “I hope the bastards are taxed into oblivion.”

    You have revealed yourself to be either of low character or ignorant of economics. Don’t feel bad: That’s very common.

    Mike

  3. I have a friend with a plumbing supply shop. His income would on paper be more than $366k, yet he is not wealthy. There are salaries to pay, a lease on his building, and insurance. Perhaps he should look for a way to shield himself from more tax through incorporation.

    Heaven forbid I should ever defend the paying of taxes, but even if I have a family (and I do – four kids) I should be paying taxes to provide for the common defense and such local public goods as the citizens of my community approve.

    Progressive taxes are unfair, discourage growth, promote evasion and avoidance, and for a Christian, represent a spirit of coveting that does not become us.

    As for big business being in bed with the Republicans, which businesses? Google has a cabinet seat with Obama, as does GE. That’s a tired and intellectually lazy attack.

    Yes, the rich tend to hate cultural conservatism. I can’t see how taxing them more solves the problem.

  4. It’s also the case that the high percentage of taxes paid by the wealthy in the US is caused by the high percentage of money made by the wealthy in the US—our rich are very rich indeed. Furthermore, our rich have been growing rapidly richer over time.

    Also, they seem to be ignoring social security taxes, medicare taxes, and all state and local taxes (which are more heavily sales & property taxes). These ignored taxes are largely regressive. They are looking at the most progressive bit if the US tax system, the income tax. Overall tax system in the US isn’t really particularly progressive.

    Having escaped libertarianism and neo-connery, I find myself disliking them more and more each day.

  5. Do you understand the difference between “income” and “revenue?” You know your friend doesn’t pay income taxes on his revenue, right? That he only pays taxes on his income (ie profit)?

  6. Before you accuse someone of writing something stupid, perhaps you should first read what they actually wrote and not what you wish they wrote.

    Nowhere do I complain that the “rich” pay too much or that it’s “unfair.” In fact, I never use the word “unfair” and never allude to the concept.

    The issue is right there in the title, if you’d bothered to read it: “Someone Else’s Problem.”

    My concluding paragraph:

    “There’s something wrong here. How can we as a country deal with the very serious financial situation we’ve spent ourselves into when so many people have no personal stake in the matter? Where is the sense of shared sacrifice that is part of citizenship?”

    The issue, quite plainly stated, is not that some people pay too much; it’s that some people pay too little. It’s really quite simple if you read what’s actually there and don’t jump to conclusions. That, after all, would be stupid.

  7. I always start think of John Rawls’ maximin principle in these instances-

    the whole idea of re-distributive justice in terms of ‘fairness’ seems to me as as ignoring the full human story (His theory is based on fairness as eliminating the effects of the triple ‘lotteries’ of life for the benefit of the least well off).

    The communitarians are closer to the truth in at least thinking of distributive justice in terms of context, culture and cohesion as well as ‘fairness’

    I say this because we, as Catholics, who believe in the providence of God have to ask whether Rawls’ threefold lottery is actually a lottery- health, education and ‘good luck’- how much is it just for the benefits they confer to be obliterated by the state in the name of justice.

    I think as conservatives we would say that it is not the state’s job in the name of justice to obliterate the effects of these ‘lotteries’ but rather that the beneficiaries of these ‘natural gifts’ of God come to realise them as conferring duties (or perhaps that should be, conferring ‘an imperative of charity’) towards their people (this is where the communitarian emphasis of man in society must necessarily be emphasised over the unencumbered self of Rawls)

    I think Boland’s principle of effects of hard times being shared equally is quite healthy, again, this necessitates a communitarian perspective fundamentally opposed to the that of egalitarian liberal Rawls, but also that of the libertarian Nozick.

  8. or Tom’s principle, rather.

  9. Hello Mr. Neven,

    If your only concern is making poor people shoulder a larger tax burden, I don’t see how you can cite the percentage paid by the top 10% as evidence of some kind of problem. The only reason to find that objectionable would be some (I think quite perverse) ideal of fairness. So it’s not surprising that not only I but most of your commenters have been focusing on this issue. The 73% has more to do with income inequality than anything else. If you want to argue that that is unhealthy, then you’d have the whole political tradition back to Aristotle on your side, and you’d be on firmer ground.

    Would you support an increase in taxes on all income groups–rich, middle class, and poor, so as to satisfy both of our concerns?

  10. Hello Mike,

    “You have revealed yourself to be either of low character or ignorant of economics.” Why either-or? I have both ignorance and depravity aplenty!

    The trouble I see with your rule is that, as Justin pointed out, it is not obvious that one’s remuneration on the market has much to do with one’s actual contribution to generating wealth, much less to one’s actual contribution to society. Taxing people based on their ability to pay seems far less ambiguous.

  11. Hi Justin,

    Excellent point: the claim that they “made” all that money is highly dubious.

  12. Hi Zach,

    “As for big business being in bed with the Republicans, which businesses?” The situation, I think is more absurd than that. Republicans craft policies to benefit these groups, but the rich and business elite themselves are, if anything, in bed with the Democrats (as your examples illustrate). The Republicans are getting nothing for their tax cuts to the upper classes and deregulation stands.

    I don’t have a plan to win over rich people to cultural conservatism. It can’t be done. They are reprobate souls, as far as I’m concerned. Compared to the general population, rich people are disproportionately likely to 1) have spent a lot of time in higher education, absorbing the prejudices of the professariate, and/or 2) belong to a certain ethnic/religious group known for its hostility to Christian culture and its fidelity to the Democratic Party.

    Given that we can’t win them over, we shouldn’t lift a finger trying to make them happy.

  13. $50,000 a year for a family of four is not “poor” by any stretch of the imagination.

    The vast majority of people who pay no income taxes are not poor either.

    The issue is the fact that people expect benefits from the government and yet feel no obligation to contribute, and politicians abet this perversity.

  14. I enjoy your site immensely and agree with you at least 90% of the time, but this blog post was absurd.

    I am certainly not a libertarian, liberal or even capitalist, however I think that First Things has a reasonable complaint, particularly when you consider what a lot of that tax that the rich are paying is going to.

    The fact of the matter is that the rich (and not only the rich of course) have to pay for many horrible, horrible things and have to prop up people who do not deserve to be propped up by the state. Wealth redistribution, planned parenthood, affirmative action administrators, welfare checks for drug addicts and single mothers, tax breaks for Jews and Muslims, goodies for greedy blacks etc, these are all things that are taxes pay for. If these programs were cut, and the rich had to pay less tax because of that, that would most certainly be a good thing for us.

    And yes, while the majority of the rich are definitely not even close to being sympathetic to our cause, I am not sure that the poor are any less guilty with their sloth, drug addictions, crime, etc. Our whole sick modern culture is reprobate.

    Also if we taxed the rich into oblivion our economy would crash, which I suppose has a positive and a negative side. On one hand there would be considerable suffering which would be hard to bear for many. But it could also (hopefully) mean the fall of the atheistic liberal democratic system, so maybe it would not be so bad at all.

  15. Hello Mr. Scott,

    Thank you for your appreciation. It is certainly true that the government does lots of evil things with its money, although that’s not exactly the same issue as how they get it. Back in the good old days, you could count on the rich to blow their money on personal extravagances, which may not have been ideal, but it was better than what the government would have done with that money. Today, the rich have found a conscience. They are no longer content to idly enjoy their wealth; they feel the need to actively contribute to the triumph of evil. Whether we tax a rich man or let him keep his money, the money is going to feminist causes.

    I wonder how sensitive the economy really would be to taking away financial incentives from the already-fabulously rich. When you’re a millionaire, do you even notice if the government triples or quadruples your taxes? You’ve got as much money as you know what to do with regardless.

  16. Hello Mr. Neven,

    “$50,000 a year is not poor” You’ve got a point there, at least in most areas of the country. If it makes you feel better, that family will presumably be paying its share of taxes once the kids are grown. Also, there must have been some outlets for civic virtue before the federal income tax was established.

    Your other major point (your post had several, and I feel free to focus on whichever I want), that a system where the masses get to decide what services the government will provide without incurring personal cost for these decisions is potentially unstable, has some merit.

  17. I’m not an American, so I make no comment on US tax policy.

    The more interesting question is why this post was featured in “First Things”, which I thought was dedicated to discussing religious matters. While there is some cross-over between religion and fiscal policy (one might, for example, enjoy reading a well-informed article on Leo XIII’s “Rerum Novarum”), it is baffling that a post putting forward someone’s essentially secular economic theories would appear there.

    I can only agree that it’s a product of the tactical enemy-of-my-enemy alliance between religious conservatives and the secular economic right. It’s the same reason why I’ve seen devout American Catholics praise Margaret Thatcher in spite of her supporting and expanding the abortion and embryology legislation.

  18. It isn’t the same issue, but those issues are closely related. If we are celebrating the current tax rate (although I’m British, so I suppose American tax policy is something I don’t know that much about and really isn’t my business), you are celebrating money being spent on many, many things (and people) that it should not spent on. We should be against the current welfare state which is helping destroy community bonds and family life, even though we can support a conservative authoritarian welfare system.

    Also, I think that anyone would notice if they started pay three or four times as much tax. It also isn’t clear to me that a millionaire isn’t that rich, but I suppose it is a question of how we define it. Is that a million dollars earned a year or a million in property and assets? If it is the latter, then my father is a millionaire (in both dollars and pounds) and he would certainly notice if he had to pay that much tax and would struggle to maintain his family’s standard of living that is certainly only middle-class.

  19. Essentially, a million dollars or pounds isn’t that much any more.

  20. There is an article at Willamette Week that breaks down who gets taxes what and why. I think the idea about “redistributing” wealth is what I call “fake morality” that’s pushed by the media to keep their rich cronies (and rich media company owners) happy. The problem isn’t redistribution it’s a tax code that gives the rich a break and soaks the middle class. Also, according to this article, job creation has not kept up with immigration, which the rich and the left favor, so this isn’t a left-right issue. Framing it as that is the media’s way to make it a football game that plays the middle class against the poor while the rich win.

    If not taxing the rich (supply side) was such a good idea, then how come it’s resulted in a growing disparity between the wealthy and the rest of us since it was put in place 30 years ago?

    http://www.wweek.com/portland/article-17350-9_things_the_rich_dont_want_you_to_know_about_taxes.html

  21. Hi Reggie,

    I think that’s what really bothered me about it, this sense of social conservatives drifting into economic “conservatism”, which always seems to end with them becoming tools of the latter.

  22. You ever come across this passage from Dale Vree of the New Oxford Review?

    “BeforeCrisis and First Things were even founded, the NOR was contacted by a neocon foundation — right out of the blue. The foundation wanted to give us money — ‘free’ money. A fellow flew out from the East Coast and asked me (the Editor) to meet him for drinks in a San Francisco restaurant — on him. Sure! (We were desperate for money.) He told me he would fund us regularly — if we would support corporate capitalism and if we would support a militaristic U.S. foreign policy.”

  23. Hi Anon for now,

    I did read that, but it sounded so fantastic, I couldn’t believe it. Who knows, though? Maybe foundations really do operate that bluntly.

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