Obama's Tax Plan: Fairer or More Dangerous?
Every Presidential election is about a new and fair tax plan for the country. Some Presidents prefer to increase taxes, some prefer to increase taxes, while others do little to nothing to change the current tax structure. The current tax structure to say the least is very difficult to understand and has well over 75,000 pages of regulations and the size of the tax policy is not likely to get smaller or simpler anytime soon unless Libertarian Bob Barr gets elected and gets the Fair Tax passed or Congress see's the light.
The Obama tax proposal overall will force $131 income redistribution from the top 1% of income payers to the lower 99%.
While many Americans may cheer this outcome as just or equitable, this sort of direct redistribution raises some important questions that should be part of a larger national discussion:
- What is the long-term effect on the economy of so few households shouldering such a large share of the tax burden?
- What are the consequences for our democratic system when a majority of Americans are disconnected from the full cost of government? Will that majority demand more from the government because they bear little of the cost?
- Should the tax system be used as a means of redistributing income or simply as a neutral mechanism for raising money for government services? Can a tax system premised on redistribution also be compatible with economic growth?
- The Obama plan assumes little behavioral change from such a large tax hike on high-income workers. Is this realistic or will the higher rates encourage tax minimization strategies and reduced work effort, which will lead to lower tax revenues?
The Tax Policy Center has done the public a service by putting hard numbers on the candidates' tax plans and bringing a dose of reality to the political rhetoric. While it is easy for the press and voters to consider only "What's in it for me?," there are larger issues raised by these findings that deserve more public discussion.
Many will not have a problem with the government forcefully taking more money from the rich and giving to the poor but I for one have major contention with this issue. Taking more money from the rich and giving it to the poor will result in greater oppression of upper income families and their equal rights under the law. This is not the ideal of a free society. This is a similar course of the Communists in Soviet Russia, Fascists in Nazi Germany, Communists in Castro's Cuba, and the dictators of the Middle East.
When people become further disconnected from the cost of government they demand more from their government without concern for the impacts on their liberties. A government with the capacity to give you everything is a government that has the capacity to take every freedom away.
Not to mention the negative impact economically on our country from continued high corporate tax rates which hinder the development of job growth, foster the transfer of business overseas, and keep trillions of dollars of assets out of the American economy in overseas tax shelters.
If America ever hopes to regain the foundations of freedoms dreamed by the founding fathers and prescribed in the Constitution we need to pass the Fair Tax immediately. To find out more on the Fair Tax you can view my series from March and April of 2008 or visit FairTax.org. The Fair Tax will promote economic growth and job growth not seen in the history of the United States and that would rival China's growth. People would not longer be taxed for working harder or having higher goals.
The income and payroll taxes are not the mark of a free society. The current "heavy progressive or graduated income tax system" takes its founding from none other than Karl Marx, the founder of Communist ideology, as written in the Communist Manifesto. This is the second step of ten to form a Communist state. Wouldn't he be proud?
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To read the rest of the article on Barak Obama's dangerous tax plan visit The Tax Foundation.
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"I think the terror most people are concerned with is the IRS. "
-Malcolm Forbes, when asked if he was afraid of terrorism
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