We often hear from the left that the rich in America don't pay their fair share in taxes. We hear how President Bush's tax cuts have unfairly benefited the rich at the expense of the poor. Poppycock! The top earners in America are, and have always been, inordinately responsible for American prosperity. They are the people who drive the economy, who provide jobs for the rest of us, who provide the investment capital that keeps America growing. And they almost single-handedly fund our federal government, according to Stephen Moore of the Wall Street Journal.
My contacts at the Treasury Department tell me that for the first time in decades, and perhaps ever, the richest 1% of tax filers will have paid more than 40% of the income tax burden. The top 50% will account for 97% of all federal income taxes, while the bottom 50% will have paid just 3%.
Scott Johnson of Power Line notes that back in 1991 the top 1% of filers paid just under 25% of all income taxes. So under Bush's tax cuts, the wealthy are actually getting soaked, as Moore notes:
Economist Glenn Hubbard of Columbia University has shown that in 1970, when the highest tax rate was 70%, the top 1% shouldered 16.7% of the income tax burden. Today the top tax rate is 35% and the same class of taxpayers pays a whopping 39% of the burden. The worst way to "soak the rich," Mr. Hubbard finds, is to raise tax rates.
But, of course, that is exactly what Barack Obama wants to do. Moore points out that Obama's plan is economic suicide, because the people who pay the tax are not the only ones who suffer the consequences of the tax.
History has demonstrated time and again that raising tax rates on the wealthy in the name of "redistribution" leads to so much income shifting, reduced work and investment, and redeployment of money into tax shelters, that the rich usually pay less, not more taxes, at higher rates. The burden of paying for government shifts to others, including some who may not file an income tax return at all – because they no longer have jobs or no longer earn enough to pay income tax.
No. It isn't the rich who don't pay their fair share of the federal income tax. Rather it is the poor. And it is time for that to change. It is time for a flat tax. A flat tax is a fair tax. To a nation of people who believe that all men are created equal and believe in equal treatment under the law, any other form of taxation ought to be seen as perverse. Too many people have been brainwashed by their government to accept the lie that it is morally acceptable to discriminate against fellow citizens on the basis of income. What is fair about a tax system where some people have to pay a higher percentage than others just because government says they are "rich"?
Every flat tax proposal I've ever seen has included a minimum income level which would be exempted from taxation, usually around $30,000 for a family of four, and most of the proposals suggest a flat tax rate of 20% or less. I vehemently disagree with these numbers. I believe a flat tax should be set at 10% of income, the same percent as the biblical tithe. If God can survive on 10 percent, so can the federal government. As Ann Coulter points out, big government is a religion. And not a particularly productive religion at that.
As for the amount of income that should be exempted, I have long believed that there should be no exemption. All income should be taxed if any is to be taxed. As long as we are to have a federal income tax, all income should be treated equally.
I was disturbed by the earlier note that said that the bottom 50% of wage earners paid only 3% of income taxes. The last numbers I saw showed that 33% of all income earners pay no income tax! That was back in 2004. The number has certainly grown since then, because of the President's across-the-board tax cuts, and most estimates put it near 40% now. This is frightening. Once this number gets anywhere near 50%, this country is finished. As Aristotle said, "If the majority distributes among itself the things of a minority, it is evident that it will destroy the city."
We must fix this now. No exemption whatsoever. If you earn money, you pay income tax. 10 percent. Period. No matter who you are. That's fair. That's equal treatment under the law.
I can't imagine what it must feel like to have your country treat you like that, like someone who isn't citizen enough to help provide for the "necessities" of his government. What a slap in the face!
Taxing all income for all people would nearly eliminate the group of people that live off the efforts of others. It would make for more responsible voters, who would realize that they are in some way paying for every government program their representatives enact. Many of the lowest income earners are high school and college students. It is wrong that people who have reached voting age and are facing college generally don't have to pay taxes. A new voter should know what it means to pay for government programs. It would result in a more limited federal government.
My flat tax would result in a more prosperous nation. How many people make $100,000 a year? Millions. They would keep $20,000 or so a year more, to spend and invest for themselves, to give to charity and family. How many people make $1 million a year? Quite a few. A person making $1 million a year would save $250,000 in taxes. That money would necessarily be spent or invested or donated. How many jobs would be created with $250,000? 5 decent ones? 250 people could earn $1000 more that year because of that one person. The split could go any number of ways. Multiply that nationwide. America's economy would explode like nothing the world has ever seen.
Sure, some poor people who would now be getting taxed where they weren't before would have to work longer, or more efficiently, to earn the same amount as they did before. It will be good for them, they will become more productive citizens. But more importantly, with all the extra money going around, the opportunities would be endless for an enterprising mind to take off. The number of people jumping from poor to the middle and upper classes would also be record-breaking.
Welfare and unemployment compensation could be slashed at least in half, and would need to be, in order to prevent people from simply not working because of the tax increase. With all the investment and spending going on, there would be no excuse for any able-bodied person who wanted a job not having one.
It has been awhile since anyone has tried to get a flat tax passed. This election is going to be all about drilling and victory in Iraq, The next one should be about fixing the tax code. Progressive taxation is a disgrace to the American ideal. It is a disgrace to the concept of equality. It is a disgrace to common sense. It penalizes the people who make our economy run, and hurts the poor through unemployment or underemployment.
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