David Cearley
Aug 26, 2017 · 4 min read

Berend, The underlying logic for me is that we, as individual citizens grant limited rights to government for our mutual benefit. I believe that tax regimens that mandate widely disproportionate rates which penalize people using the rationalization that they can afford it more than the next guy kinda misses the point. We formed the government in order to provide necessary services beyond our individual capacity to provide. Each of us should have the responsibility to contribute to the cost, if only so we all are aware that we share in different ways, the burdens and benefits from it. In the US, one half the population contributes only 3% of income tax revenue. A healthy percentage of that population are net tax collectors rather than payers. While I’m not suggesting that we should all pay identical tax rates, I do believe it is necessary, and greatly beneficial to society, that each of us recognizes and accepts our individual and shared responsibility for funding and in other ways supporting the government we have created.

I like to use New York City as an example. The city has an income tax, and it is highly progressive. So progressive in fact, that as a former mayor pointed out in a media interview, 40K individuals actually pay more than 50% of the city’s income tax revenue, while the other half is paid by the remaining 7,950,000 residents. Ignoring the financial implications, what about the societal ones? What level of responsibility do they feel for their government’s efficiency? How disgusted are they by corruption? Do they make the connection between themselves and the costs of say, picking up the beat up old couch on a vacant lot, or the enormous costs of their transit system? Worse, municipalities have myriad ways of extracting revenue from us. What do they do when citizens demand services but refuse to pay for them? They keep tax rates low for the majority so they can stay in office, and then they manufacture a million ways to collect fees and fines, mostly from those least able to fight them, the marginalized and the poor.

What we end up with are affluent people angry about overgenerous contracts, unfunded pension liabilities, grossly progressive tax burdens, and middle class and those in poverty resentful of their government for things like policing for profit, police departments as revenue agents and debt collectors, a justice system which shifts most of their costs to those least able to pay, permit departments who both collect massive fees AND extract bribes from those who primarily just want them to efficiently do the job they are supposed to. Virtually everyone is angry at government, and their anger is legitimate. For a clear understanding of just how twisted this system is I urge you to read the DOJ report on the Ferguson police department. While their investigation of the officer involved in the shooting could serve as defense exhibit A at his trial, the department report is a damning assessment of exactly how many municipalities finance themselves on the backs of the marginalized and the poor. When Mr Obama was in office, he once made fun of titans of industry for their private jets. Let’s not forget that real working people build those jets, they service them, fly them, clean them, and on and on. Much is made of all our infrastructure the so called “rich” actually benefit from. So what. We all benefit from those things, and the guy who pays for it all has no less right to services than anyone else. Our taxation systems have become so progressive, primarily dependent on so few, that the majority could easily pass exorbitant tax bills because the voters know that they actually have little or no responsibility for paying them.

So ask yourself, should any society have the right to target a small subset of their citizens to carry vast majority of the burden of the cost of governance, regardless of their income? Should that an accepted value of representative governance? Contrary to popular belief, the majority of the actual rich accumulate their wealth in a single generation, and they make their money by delivering products or services which fellow citizens willingly part with their cash to get. Business has no power whatsoever to force people to pay purchase from them, that authority we reserve to government. Oil companies are also a wonderful example. The cost of fuel rises, and some politician stands at a podium, points their finger at the oil companies and tells us it’s their fault. Meanwhile, what the government collects from each measure of fuel far exceeds any money collected by the investors and companies who put their money at risk to find, extract, transport, refine, and deliver the actual product. And the public eats it up. They WANT to believe it. I think you live in the UK. Your government collects more in tax revenue on each gallon of gas than the entire total cost of producing the fuel, including the costs of employee taxes, pension payments, and billions in taxes that are taxed again. But if you asked John Doe on the street, he would tell you the fuel company is ripping him off.

I believe our primary issue is one of government transparency and accountability, not tax rates for wealth producers.

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    David Cearley

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