Who’s Paying the Taxes

Our President seems to think that millionaires are getting away with paying too little in taxes.  Maybe, but he is presenting an inaccurate picture.  We’ve heard it all before.  The rich are not paying their fair share.  The unfortunate middle class are paying more than the wealthy.  Bosses are taxed at a lower rate than their secretaries.  Democrats love to say those things.  It makes them popular and foments the envy and resentment that keeps them in power.

Except, it’s not true.

Let’s ignore the fact that almost half of all income earners in America pay no federal income tax.  Some people even get more “credits” than they have withheld from their paychecks, so that the federal government is giving them money throught the tax system.  Let’s also ignore the fact that Warren Buffet, whom the President mentioned in his speech, owns an investment firm, Berkshire Hathaway, that is behind in paying its taxes.  And let’s ignore the fact that the Treasury Department accepts donations, and Warren Buffet could send them an extra billion or two anytime he wishes.

Let’s just focus on the fact that what the President said is just not true–at least not on average.  I have seen various figures–from the IRS and from the Tax Policy Center, indicating that on average the people making $1 million a year pay income tax at a rate of about 18%-29%.  The middle-class folks that Obama mentioned in his speech pay at a rate of about 15%.  So, if Warren Buffet pays at a higher rate than his “secretary,” then either he is a statsitical outlier or his “secretary” is or both.  (Buffet doesn’t actually have a secretary, per se, but has several administrative assistants who, according to one article that I read, a bit annoyed at the attention they are getting thanks to the President’s speech.)

According to the Congressional Budget Office, the effective tax rates of all taxes paid (not just federal income tax), break down this way:

• Bottom Quintile:  4.3%
• Second Quintile:  10.2%
• Third (Middle) Quintile:  14.2%
• Fourth Quntile:  17.6%
• Top Quintile:  25.8%

So, the rich are paying taxes, and on average, they are paying at a higher rate than the poor and middle class.  Much higher.  Already.

Certain individuals may be paying less.  After all, both Republicans and Democrats in Congress have given them numerous loopholes, exemptions, and shelters.  It is not a fair system, because it favors some and disfavors others.  The Democrats cannot create those loopholes, or help create them, and then complain when people take advantage of them.

In trying to get some data, I was amazed that there are no hard numbers.  There should be.  It should be clear how much a $1 million earner pays in taxes, because he, in a just system, would pay exactly what every other $1 million earner pays.  It would be a set percentage for everyone–at least for everyone in that same bracket. 

One question that I hope everyone asks is this:  if millionaires are paying so little in taxes, then where is all that revenue coming from?  Is it really the folks making $50,000  a year who are coughing up the billions of dollars of tax income that the government takes in?  That’s mathematically impossible.  Those who envy the wealthiest 10% should remember that they are footing most of the bill for everyone else. 

The President might have had the capital gains tax in mind when he talked about millionaires paying at a lower rate than their secretaries.  It’s true that the rate for the capital gains tax is low–15%, but it is misleading to write that without also mentioning that it is a tax on money that was already taxed–at a corporate tax rate.  Some people, me included, think that capital gains should not be taxed at all for that reason.  (Same with inheritance taxes, but that is another matter.)

You might think that millionaires should pay more in taxes.  Fine.  But you can’t say that it’s because they pay at a lower rate than middle class people.  You should simply say that the rate that they currently pay is not high enough in your view.

I had one more thought on the President’s remarks.  His observation cuts both ways.  If secretaries are subject to a higher tax rate than millionaires, then lower their tax rate.  That’s another way to fix the problem.  Raising taxes is not the only possible solution to every problem.

 

Literal, Not Figurative, Theft by Uncle Sam

Those of you who like government power will love this item.  Then again, the ACLU doesn’t like it, so maybe you won’t either.

An editorial at Forbes by Daniel Mitchell exposes something that I was not aware of–seizure of assets held by non-criminals.  You can read it yourself, but the key points for me are as follows:

• The government should have the power to seize assets that were illegally gotten, such as in a bank robbery or a case like the Bernie Madoff rip-off.
• Because of the presumption of innocence, the government should take people’s assets only after a person is convicted of a crime.  (I would add that they should have the power to temporarily seize assets that are needed as evidence in a trial.)
• There have been cases of innocent bystanders (presumably anyway) having their assets confiscated because they happened to be among the assets of known or suspected criminals or because of some technical violation of an obscure (and unjust?) law.
• There are now 400 laws, apparently almost double the number from 10 years ago, related to asset seizure by the government.  And they still want more.
• Local agencies benefit from seizing assets, because the national government “rewards” them with a sizable portion of the loot that they take.  In other words, there is a tantalizing incentive for taking people’s welath away from them.

But we should trust the government to do the right thing, you might argue.  Sure, I answer, because there have never been any crooks in the government!

A more serious answer is that it is never, ever the right thing to take people’s belongings away from them just because you grant yourself the power to do so.  We have reverted to tyranny with these laws.  They should be abolished.

Why, I wonder, do people distrust Catholic priests, factory owners, and used car dealers, but they put absolute faith in politicians and bureaucrats?  Do those people sport a halo that proves that they have only the best intentions in their hearts?  Do they have a track record of doing only what is good and right for other people?  Are people simply apathetic–as long as they are not the ones having their property seized?  Are some people even happy to hear that the government is taking all that money, considering the budget crunches?

Warning:  it could be you next time.

How Expansive?

     According to the 11th Circuit Court of Appeals, the Patient Care Act promoted and signed by President Obama is breathtakingly expansive.  Oh, and it is unconstitutional. 

     So, it’s not just Tea Partiers who think so.  A three-member panel of the 11th Circuit decided that. . .

This economic mandate represents a wholly novel and potentially unbounded assertion of congressional authority: the ability to compel Americans to purchase an expensive health insurance product they have elected not to buy, and to make them re-purchase that insurance product every month for their entire lives.

     Earlier the 6th Circuit Court of Appeals had ruled that the law is consitutional, so now it is up to the Supreme Court.  Several more cases are pending, so who knows how long all of this will take, how much it will cost, and what the outcome will be.  President Obama now has to decide if he should try to stall the litigation until after the election or get it over with to save the government a lot of money.

     The fundamental question is whether the Congress can grab more and more power on the basis of the Commerce Clause in Article 1, Section 8, of the United States Constitution.  The 11th Circuit has answered with a very strong no.  They not only pointed out that the Obama Care law could set a precedent for allowing Congress to force people to buy insurance against other problems but also to force people to buy any number of other products–a fence around one’s yard, a rabies vaccination, a smoke detector in every room of one’s house, a central air conditioner, voltage surge protectors for every electrical outlet, etc.  (The examples are mine.)

     They pointed out not only that Congress is forcing private citizens to enter into contracts with private firms, but also that they are forcing them to do it month by month from the time they are born until the day that they die.  That is a lot of power that they have taken upon themselves–without, according to this court, any authorization by the Constitution. 

     There is no precedent for such a thing, the court pointed out.  The government has never required people to buy a surplus of food or to acquire savings bonds or to put money into the bank or to buy more products to stimulate the economy or to buy a car with high fuel efficiency.  (Those are their examples.)  Even though those things would benefit both individuals and the country in general, the Congress has never presumed that it had the power to tell people what they have to buy.  (I would point out that many of their regulations limit what you can buy, but it is true that they have never mandated what you must buy.)

     The court also pointed out that the government’s position is that the mere fact that you exist makes you subject to the Commerce Clause, rather than your choosing to engage in interstate commerce.  Not only that, but your existence gives Congress gives the power to regulate you during every moment of your entire life–not just when you choose to engage in business of some sort.

      The court said that the Congress cannot claim absolute power to regulate from the consitutional fact that it has limited power to regulate.  In other words, saying that the individual mandate is necessary to make the rest of the law work is not a valid argument.     It said that the weak penalties for noncompliance actually undercut the Congress’s claim that the mandate to purchase insurance is necessary and essential to the rest of the law.

     The court also said that the law is overly complex, and they took thirty-five pages our of their 304-page ruling to try to outline what the law actually does.  They claim that the complexity of the law makes it difficult for any court to determine whether it, in its entirety, is consitutional or not.  (Maybe they should just do what Nancy Pelosi said–wait and see!)

     I did not see that the court mentioned it, but I would add that the granting of temporary waivers proves that the Congress and the President know that the law is injurious to businesses, including the many unions that have applied for and gotten waivers.

     Although the court cited dozens of legal precedents, the Obama administration has, of course disagreed with the ruling.  We’ll see what the Supreme Court says.

Casey Anthony

I cannot say if Casey Anthony did what she was accused of doing to her daughter, Caylee.  Only a few people, or perhpas only one person, can say what actually happened with certainty.  The evidence, it seems to me, makes it look as though she was guilty, but a jury has found otherwise.

As far as I can tell, the jury did its duty properly.  They had two choices:  find her guilty beyond a reasonable doubt or find her not guilty.  They apparently could not do the former, and so they were forced by the law to do the latter.  There is no “pretty sure” when it comes to a homicide verdict; there are only the two choices I mentioned.

I am thankful for our legal system.  I am glad that we presume that people are innocent until proven guilty.  I am glad that we are cautious about convicting and punishing people.  (In particular cases, that is not true, but it should be in every case.)  I am glad that we would rather let a person who is probably guilty go free than to put a possibly innocent person in jail–or worse.

It’s sad that justice might not be done in regard to whatever happened to little Caylee Anthony.  One reason that it cannot be done is because of all the deceit surrounding the investigation of the case.  Casey Anthony was found guilty of lying, and her lying really muddied the waters.  Her family members were no more helpful than she was.  That’s too bad.  Truthfulness at the beginning of this mess would have kept it from spiraling into the much bigger mess that it became.

I suppose if I take anything from the case, it is this.  If you find yourself in trouble, just own up to it.  Tell the people in charge the truth and face whatever consequences ensue.  If you are close to some kind of trouble, be helpful and forthright, so that the truth will come out and justice will prevail.

Not Discriminating is Discriminatory

Once again a court is trampling on the rights of the people.  A federal appeals court has ruled that the people of Michigan did not have the right to ban racial preferences in college admission policies.  In other words, the people said no more discimination, and the court ruled that not discriminating is discriminating.

A few points, loosely connected:

It’s sad that the word discriminate became a dirty word.  It is a good and useful word.  People discriminate between fresh food and rotten food, so that they do not get sick.  They disciminate between one television show and another when they choose one to watch.  It is not wrong to discriminate, unless you are discriminating between classes of people in an unfair way.  We should be against unfair discrimination not against discrimination in general.

———-

When you pick people because of their race, you are discriminating, and it is unfair discrimination.  When you pick them based on performance or qualifications, you are discriminating but not in an unfair way.

What this court has said is that colleges must discriminate on the basis of race.  That is unfair and wrong.

———-

What bothers me the most is that the court overruled the will of the people in a state in which the people have a legal right to amend their consitution by referendum.  Now, had the people amended their constitution to exclude people of certain races from college entrance, the judges would have a leg to stand on.  Had they amended it to keep race an issue in enrollment determinations, then it might make sense for the court to overturn the referendum.  But they voted to end the practice of using race to decide who gets in.

———-

Finally, I wonder if the state of Michigan will apply the same procedure to basketball teams.  Will college basketball teams have to have proportional representation?   They certainly do not at present.  Nobody would stand for having short white guys being a majority of players on the team.  Then why do some people stand for racial quotas in other areas?

Bad Thinking on the Constitution

Please read this article in Time magazine on the Constitution of the United States.  It is terrible.  It is often self-contradictory and simplistic.  It is probably one of the worst essays that I have ever read on the Constitution, espeically since it is really a thinly disguised attack on the Tea Party and on anyone who values freedom and the solid foundation laid by our brilliant Constitution.

The first self-contradiction is between the title, One Document, Under Siege, and the writer’s conclusion a few paragraphs down that we are in conflict but not in a crisis.  If the Constitution is under siege, isn’t that a crisis?  He cannot seem to make up his mind.  He talks about the Tea Party’s “almost fanatical focus on the founding document.”  I’m glad that he said almost.  Although I have to wonder what citizens of a country are supposed to do with a founding document if they are not supposed to focus on it.

Another self-contradiction is that the author seems to imply that we do not need to be so picky about the text of the Constitution, but he uses citations from it and a bit of history to prove his points.  You cannot argue against a rigid or “almost fanatical” approach to the Constitution and then use the Constitution to make your points.

Stengel begins the essay with a simplistic syllogism, which essentially says that since certain circumstances are different (such as the existence of Lady Gaga), we need to change the Constitution.  What makes that a simplistic idea, besides the obvious point that the existence of Lady Gaga does not necessitate a change in the Constitution, is that he pretends not to know that there is a process for changing the Consitution and that it has been done almost thirty times.  I say pretends because later he refers to various amendments to the Constitution.

That’s the thing.  Our leaders are not supposed to just ignore it or to “interpret” it in such a way that they can justify whatever they happen to want to do.  If somebody doesn’t like something in the Constitution, they are supposed to follow the guidelines contained in it for amending it.  Nobody in the Tea Party or other groups that call for strict adherence to the text and to the intent of the Framers is saying that the Constitution can never be changed to meet changing circumstances.  They are saying that we need to respect the rule of law and amend it according to the agreed upon process.

If, as Richard Stengel, seems to think, the Constitution can be changed and reinterpreted and adapted to fit new circumstances, whose interpretation should the government adhere to and how will they decide?  It is simple for Stengel.  His interpretation is the correct one (and Ron Paul’s is the wrong one).  Mr. Stengel has all the answers on what the Constitution means, although I am not sure what qualifies him to have them.  But that’s precisely the problem with not strictly adhering to the text and to original intent:  it then becomes a matter of individual opinion, and that is a chaotic way to try to run a country.  Should the President do what Ron Paul thinks or what Richard Stengel thinks?    Stengel’s ideas on how to understand the Constitution do not all agree with mine, but we do not have to fight about it.  We just have to read the text and learn the history to find out what our founding document means.  Ultimately courts make the final determination, and if they are just, they do it by objective means.

You know, just because things change does not mean that the Constitution is outdated or useless as it is.  It was not meant to micromanage government but to create the framework for it in fairly broad strokes.  Stengel points that out, but he misses an important logical conclusion.  The conclusion is that whether we have horses and buggies or gasoline-powered automobiles, the principles of the Constitution are still applicable and do not change.  The government still cannot take away your car because you criticize the President, even though the Framers had no idea that there would ever be such a thing as a modern car.  They can still write laws to insure public safety, just as they could in the days before automobiles.

The New York Law

I haven’t written on the topic recently, and I actually avoid it, because when I do write about same-sex marriage, the reactions are not always very nice. Some people like to show me how tolerant they are by being very beligerent.

The first thing I want to say is that I am glad that this same-sex marriage law in New York was enacted in a proper, consitutional way. The legislature approved it, and the governor signed it. To the extent that the state has representative government, the law represents the will of the people. I like that better than courts overruling the will of the people.

The second thing that I want to say is that if the states continue to enact legislation in this way, and it eventually becomes universal throughout the United States, I will accept it for what it is. It will not change my personal religious views on the subject, but I respect how our government was intended to work, and I want it to work that way.

I thought about something related to this topic–something I had given no thought to for years, but it popped up from my memory bank. When I was in sixth grade a friend of mine told me that Jim Nabors was married to Rock Hudson. I thought it strange–the idea of two men being married to each other. At that time I knew nothing about homosexuality–or about heterosexuality, for that matter. I just knew that men and women fell in love, got married, and produced babies. I had had the mechanics of reproduction explained to me by then, but I still didn’t exactly understand how the process happened. After all, I hadn’t seen it demonstrated or done it myself. It would probably amuse you for me to explain how I thought it worked when I was that age.

My reaction to the idea that two men could be married, which I don’t think Nabors and Hudson were, was a bit of bewilderment mixed with amusement. Maybe it was a pubicity stunt or a joke, I thought. Maybe people of the same sex sometimes do get married, I thought, although that seemed a bit weird. I had never seen such a thing, after all. What would that accomplish anyway? They cannot have children together. I knew that much.

In my young mind I think I realized that marriage is the uniting of polar opposites. It is the union of male and female in such a way that they complement one another and bring out the best in each other. They sometimes challenge each other, since a man cannot fully understand what it is to be a woman and vice versa. Through that challenge they can adapt and grow and learn to respect each other’s differences. A man and a man can have a similar relationship, but they cannot have the same thing as what is traditionally called marriage. They can love each other and be each other’s partners in life, but they cannot act as a synthesis of the male and the female–the two complementary sides of humanness.

This is not about the meaning of words. True, the same-sex marriage laws essentially change the meaning of a word, but I think the matter goes much deeper. The union of male and female is what it is, no matter what you call it. Call it a peanut butter and jelly sandwich, if you like. (But then we would need to call same-sex marriages peanut butter and peanut butter sandwiches!) A marriage reflects unity in duality–the blending of opposites to make something entirely new; in other words, synthesis. It has the potential to result in a brand new human being that has a little of the father and a little of the mother in some unpredictable combination. (Even same-sex parents have to admit that at least one of them is not the biological parent of the child.)

That’s the way that God or Nature–take your pick–set it up. It would be interesting to live as creatures with no sexual distinction or with more than two sexual distinctions, but we don’t. There’s a Y-chromsome and an X-chromosome. There is testosterone and there is estrogen. It would be interesting to live in a world where any two people (or any two creatures of any kind) could unite with each other and produce offspring, perhaps in all sorts of fascinating combinations, but we don’t. There is no point in fighting reality or in living in a pretend world.

I know that two men can love each other. In fact, I as a man love lots of other men and lots of women. I don’t think that marriage is primarily about love, though. I know that two men can share physical intimacy, but I don’t think that marriage is primarily about physical attraction or physical intimacy. I think it is primarily about the coming together of polar opposites to produce a unity that combines the best of both for the mutual benefit of both. I think it is primarily about building a solid, stable relationship that provides a framework for raising children, since children do usually result from it. It establishes legally that this man is the father and this woman is the mother and that they are legally responsible to care for the children and to answer for whatever the children do.

That, by the way, is the only reason that I can see that the state has any business being involved in marriage. Other than for the protection of children, the state should let it be a private matter.

Google a Monopoly?

Google is under investigation. They are too successful. They are too rich. I don’t know how somebody can be too successful or too rich, but apparently the folks at Google are.  Maybe they should have tried to be more mediocre.   Yeah, that would serve people well!

Maybe they should have turned over all their software to their competitors, so that Google could go bankrupt and let the others take over their niche.  That’s what sports teams do–they tell the other team their plays so that they do not have an unfair advantage over them.  Oh, wait!  They don’t actually do that, do they?

Google is clearly are not a monopoly. There are other search engines: Yahoo, Duck Duck Go, Dogpile, Ask, Bing, Yippy, Mahalo, and others. There are other e-mail providers, too. Lots of others, including Hotmail, Zoho, AIM, GMX, Yahoo, Big String, and Fast Mail.

Going after a corporation because it is too successful would be like taking away a basketball championship title because that team has already won the title before.  It would be like saying that Tom Hanks cannot make any more movies, because he has already been in so many and has already made lots of money in that industry.  It would be like saying that a college student should have his GPA lowered because he has earned too many A’s.

In case you cannot tell, I am no fan of anti-trust laws.

Geert Wilders and Free Speech

I was pleased to learn that Geert Wilders, the Dutch politician, was acquited of the charges against him. He is very outspoken toward Islamic fundamentalism and Islamic terrorism, and the court ruled that he was legally entitled to epxress his views, even though they are sometimes, as the court said, “crude and denigrating.” He is horrified by the terrorist attacks that have occurred in Europe over the last few decades, as any moral person would be. He is concerned about the influx of Muslim immigrants into the Netherlands who do not want to integrate with Dutch society, and he is not alone.

Mind you, I am not defending what he said. Some of it goes beyond common decency. I would not say such things, and I would not approve of somebody else’s saying them–some of them, as I said. However, in any country that claims to have freedom and claims to protect people’s rights, people must be allowed to say things that other people don’t like.

It is always clear to people when they agree with the speaker in question. The operative principle here is that if you want speech protected when you find it agreeable, then you also have to protect it when you find it disagreeable.

One way that Wilders upset people is with his film
Fitna. It quotes passages from the Koran and shows scenes of violence committed by devout Muslim people. What is strange to me is that people blame Wilders for what the film implies. He says nothing in the film. No Christian person and no European person utters a word in it. It shows imams preaching and verses from their holy book and terrorist actions perpetrated by Muslims. If people don’t like it, it should not be Wilders that they are angry with. They should be angry about what the film depicts, not with the one who made the film. It seems that some people do not like it because it documents facts that they would rather forget. It does not “incite” hate, as some have suggested. It depicts words and acts of hate by other people.

One of the Rich

As I have written before, my family and I are just above the so-called poverty line, so although a person who makes $180,000 a year is not filthy rich, he is a lot richer than I am. Given that the person I speak of has also made another million or so on the side, he is way, way richer than I am. The person I speak of is a scientist in a government sponsored job. In other words, every person who pays income tax, directly or indirectly, is paying him. (Even those who pay no income tax, like me, pay it indirectly because we purchase things from people who pay it, and it is undoubtedly part of the price that we pay.)

His name is James Hansen, and he works for NASA at the Goddard Space Institute. On top of his quite nice salary that taxpayers fund, he has made a lot of money on the side–in ways that some people think are in violation of federal regulations. That part remains to be seen, but it is clear to me that what he has done is unethical in the general sense of the word. He apparently has used his position in a government agency to make extra money, to advocate a position that he is being paid to advocate, and to advance an agenda that makes many of his backers wealthy, too.  And it just so happens that his agenda is quite controversial and is not accepted by all of the taxpayers who fund his work.

I find it disgusting, deplorable, and despicable.  Yuck, yuck, yuck!  And I woudl dislike it even if he was being paid by some oil company to oppose the global warming movement.  In other words, I am against this sort of thing in principle–not because of my personal views on what Hansen has been advocating.

This situation is a straightforward and clearcut example of why I believe in the separation of business and state.  Climate research should be conducted and funded solely by private individuals and groups who have an interest in it.  Any adovocacy or promotion of a certain approach to climate should likewise be done privately.  Otherwise you run the huge risk that people will do what could easily be construed as taking bribes.  And, as I wrote above, I don’t care if the cause is something I believe in.  I want the government out of it.

If it is as important as people say it is, then people will support research on Climate Change.  They will support efforts to reverse it.  The govenrment, that is, the state, won’t have to.  If people are not in favor of support climate change research and propaganda, then the government should not do so.  “We the people” are actually the government.  Our representatives are supposed to–imagine it–represent us.

Since I wrote about Ayn Rand in the post below this one, let me make one thing perfectly clear.  In recent discussions I have had, it seems that many people would assume that Rand would applaud this man, Hansen, because of the large amount of money that he made for himself.  Not at all!  She would be appalled.  She believed, like me, that the government should have no involvement with business–either for good or ill.  She would certainly admire Hansen if he made a lot of money as a research scientist working for a private foundation or private business, especially if his work also happened to contribute something good to the world (think:  Harold Roark in The Fountainhead and Hank Rearden in Atlas Shrugged).  But she would not admire somebody living off public money and using his public position to further enrich himself.  Such a man is the antithesis of Roark or Rearden.

I think this leads me to another point.  Based on what I have written, it would seem that I object to the existence of NASA in the first place.  Actually, I do.  The work of NASA could have been done by private organizations and individuals.  You might say, “But private people do not have the great resources that the government has.”  I would first say, “Huh?”  First, the government is you and me, ultimately–”we the people. . . .”  Second, all the resources (or nearly all) that the “government” invested in NASA came from private people and private businesses.  Our government leaders don’t have a magic money machine or a big pile of money hidden under the Capitol building.  They get money by taxing us.  Therefore, all the money that has been poured into NASA could just as easily have been donated to a private space foundation or have been earned by a private space exploration company.

It’s the same money.  The same money that the government spent on space exploration was the money that once was in the hands of all of us.  So, it might have been nice for our leaders to let us decide if we wanted to spend our money on a space program or not.  If there was overwhelming support for such a program, it would have happened anyway, without the state’s involvement.  Just as there is a movie industry and a sports industry that does not depend on the state to exist and to thrive.