Monday, February 21, 2011

This is not Disneyland

Well I've only been there once, when I was ten years old.

But the mystique is there - Disneyland! Where you can converse with flying elephants, the streets are lined with gold, everyone, even from dysfunctional families, has a good time! We are all enamoured of Disney magic.

What is the purpose of a federal income tax? Is it to keep a standing army, ready to defend the homeland? And now by extension, to staff airports to keep out terrorists with their nasty printer toner cartridges linked to 3+ ounces of liquid and a cell phone meant to detonate on contact?

Who should pay for these services, and should some pay more than others? This is the heart of it, so pick your philosophy.

If the federal income tax is meant to be redistributive - bring the poor up a notch by giving them refundable tax credits. So even if they make so little that they aren't paying tax directly, they actually get a check from Uncle Sam. Perhaps they can claim kids as deductions, claim an earned-income tax credit, or pay tuition.

Or is the tax system meant to tax the very rich, the theory being they have more, so should pay more. I heard today, being President's Day, that in Lincoln's administration the tax rate notched up to 90% for the highest earners - to pay for the Civil War.

Taxes have historically been high during war time. It was also up to 90% to pay for WW II. As well as every citizen buying war bonds to pay down the debt, and saving up aluminum foil, stockings, tin cans - for weaponry I guess. Note to self: look into this, the 40's are an amazingly interesting era. Not to mention my mom graduated high school in 1941, right in the thick of it. Tons of photos with her boyfriends, all of them military guys.

So now we have a war - 2 wars as they say - Afghanistan, Iraq. And anti-terrorist activities to pay for. Well you would think our tax rate would be 110%. However it is 15% on capital gains, for those that claim this income from stock held more than one year.

Its Disneyland for someone. Not for me right now. I don't much like Disneyland anyhow, something fake about it.

Who benefits - every single person. Who should pay - every single person. Value-added tax is something popular in Europe, or even in Canada. A national sales tax. If I go to buy a candy bar (not that I should, oranges are the dessert of today, lets see how long I can stick with that..) that costs 99cents, it should cost $1.03, with 4 cents going to the federal coffers.

To do otherwise pits us all against each other, class warfare. One side will scream "the rich should not pay taxes - they create the jobs and reinvest in society!". The other side will scream "the poor should not pay taxes, we should give them a break, and notch them up!".

Both are Disneyland. Give me a real tax system.

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