(Image: Wikimedia Commons)
[This post originally appeared on my old blog in November 2008. It seems worth sharing with a new audience.]
Too many people have been suckered into accepting a ridiculous “class warfare” mentality. The prevailing thought is: “Sock it to those damn rich! That will make us feel better about ourselves! After all, it’s only fair.”
Unfortunately, this misses a few important points. First, the “evil” rich are the ones out there taking risks, creating businesses, creating jobs, and creating wealth. Second, “class warfare” is a Marxist ideal that is completely opposed to the American dream. In America, you have the unique opportunity to make anything of yourself if you’re just willing to put in the hard work. Anyone with a good idea is completely free to turn it into a multi-million dollar business. Ever heard of Walt Disney, Ray Kroc, Harland Sanders (you might know him as Col. Sanders), or Sam Walton?
“Come on, Steve,” you say, “that takes too much hard work. I’d rather sit around and receive my government handout. Those rich make too much profit. They can give some to me. After all, it’s only fair.”
That idea replaces “trickle down economics” with “trickle up poverty.” In a capitalist economy [Note: I should have more properly said a “small business friendly” economy since there’s little difference between “corporate capitalism” and socialism], as people make money, they tend to open more businesses and create more jobs, which creates more wealth for everyone. Oh, and as profits go up, tax income increases as well not only due to the fact that there’s more profit, but there are also more workers paying their taxes (but we don’t want to talk about that).
Today, we want to replace capitalism with Marxist ideals (which by the way worked out just so great in the Soviet Union) that punishes the wealthy and rewards slackers. So instead of everyone becoming better off, we all become worse off – “trickle up poverty.” Fewer businesses are opened, fewer jobs are created, and less wealth is generated. You can’t “spread the wealth” when there is no more wealth left to spread.
Here’s the other dirty little secret: 40% of Americans pay NO income taxes! In fact, most of them get a check from the government for the earned income credit. Meanwhile, the top 5% of Americans are paying nearly 60% of the income taxes. How much more do they need to be squeezed? How much is enough, how much is “fair?”
Is it really “fair” for you to work your butt off so slackers can sit around and do nothing?
Why do we want to keep punishing the “rich?” [Instead of punishing the rich, doesn’t it make more sense to create an environment which allows more people to become rich through their own ingenuity and hard work?]
The story below has been falsely attributed to a Georgia college professor. Even though that’s not who really wrote it, it remains a very clear explanation of our tax system and why the “sock it to the rich” mentality is flawed.
The Tax System – Explained With Beer
Suppose that every day, ten men go out for beer and the bill for all ten comes to $100. If they paid their bill the way we pay our taxes, it would go something like this: The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.
So, that’s what they decided to do.
The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve. ‘Since you are all such good customers,’ he said, ‘I’m going to reduce the cost of your daily beer by $20.’Drinks for the ten now cost just $80.
The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free. But what about the other six men – the paying customers? How could they divide the $20 windfall so that everyone would get his ‘fair share?’
They realized that $20 divided by six is $3.33. But if they subtracted that from everybody’s share, then the fifth man and the sixth man would each end up being paid to drink his beer. So, the bar owner suggested that it would be fair to reduce each man’s bill by roughly applying the same percentages that each man paid to the new $80.00 amount, and he proceeded to work out the amounts each should pay.
And so:
The fifth man, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33%savings).
The seventh now paid $5 instead of $7 (28%savings).
The eighth now paid $9 instead of $12 ( 25% savings).
The ninth now paid $14 instead of $18 ( 22% savings).
The tenth now paid $49 instead of $59 (16% savings).
Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings.
‘I only got a dollar out of the $20,’declared the sixth man. He pointed to the tenth man,’ but he got $10!’
‘Yeah, that’s right,’ exclaimed the fifth man. ‘I only saved a dollar, too. It’s unfair that he got ten times more than I!’
‘That’s true!!’ shouted the seventh man. ‘Why should he get $10 back when I got only two? The wealthy get all the breaks!’
‘Wait a minute,’ yelled the first four men in unison. ‘We didn’t get anything at all. The system exploits the poor!’
The nine men surrounded the tenth and beat him up.
The next night the tenth man didn’t show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. They didn’t have enough money between all of them for even half of the bill!
And that, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.
Nullification Now? Nullification No!
(Image: Wikimedia Commons)
With the Supreme Court’s ruling upholding Obamacare, in what at best might be described as an attempt by John Roberts to “save” the “reputation” of the Supreme Court, many are again calling on states to use nullification to stop implementation of Obamacare. Nullification is the legal theory which claims individual states have a right to nullify or invalidate any federal laws which an individual state deems unconstitutional. On the surface, it might sound like a good idea. However, we must dig a little deeper to understand why “nullification now” is not the answer in our current Constitutional crisis.
People often don’t like hearing reality contrary to their opinion (and more than a few seem to enjoy playing “shoot the messenger”), but nullification is quite simply a dead horse. United States jurisprudence has a long track record of not upholding nullification. From 1798 until the start of the Civil War in 1861, several states either threatened or attempted to nullify different federal laws. None of these nullification attempts were upheld by the Supreme Court. On top of this, the Civil War, as a victory for a powerful and centralized federal government, effectively silenced further nullification attempts.
Nullification remained a dead issue until the mid-twentieth century. It once again reared its head in the 1950s as southern states fought against forced integration of public schools by the federal government. This time, nullification went to the Supreme Court as a specific issue and was explicitly struck down in Cooper v. Aaron (1958). In this case, the Court explicitly, once-and-for-all, clearly declared that individual states may not refuse to enforce federal law. As an aside, we also find the Court now claiming that individual states likewise may not enforce federal law which the federal government refuses to enforce itself: Arizona v. United States (2012).
Such rulings stem from the fact the Supreme Court has interpreted the Fourteenth Amendment in such a way as to use it to apply nearly the entire Bill of Rights to the states. In the process, the Court has largely eradicated individual state sovereignty. Keep in mind, when the Bill of Rights was drafted, it was understood as something imposing limits on the federal government, not on individual state governments. Had those voting on it understood it applying to state governments, it would have never garnered the votes necessary for ratification.
However, even on its own, the nullification theory lacks a valid Constitutional basis; hence the reason the Supreme Court has consistently rejected attempts at nullification by individual states. No less a figure than James Madison held that nullification was unconstitutional. Do nullification proponents seriously believe that James Madison lacked proper understanding of the Constitution?
Further, even if nullification were a Constitutionally valid position, since we’ve allowed the creation at all levels of the job title “career politician” (people for whom reelection trumps doing the right thing), do we seriously believe there are enough state legislators willing to actually pass nullification? Not only would they fear their state being cut off from the teat of federal government appropriations, but would also fear the backlash from the hordes of people now dependent on Big Government handouts (so-called “entitlements”).
On top of this, again even assuming nullification were Constitutionally valid, those calling for nullification are under the impression the federal government would simply allow the sates to “go quietly.” Such a position is nothing short of delusional. Let’s not forget a little thing called the “Civil War.” Consider what Lincoln was able to do with a significantly smaller and significantly less powerful federal government. Now consider the vastly larger and vastly more powerful federal government we’ve allowed to come into existence today. It is not a bureaucracy that can simply be ignored; nor indeed a bureaucracy that will allow itself to simply be ignored.
Before I get attacked with the dreaded label of “neocon” (a phrase so causally tossed out by Tom Woods/Ron Paul libertarians whenever they believe they’re losing an argument – as if calling their opponent a “neocon” triumphantly and automatically settles every argument in their favor; odd how they so often insist on employing the exact same sort of name-calling tactics as TeamObama against anyone who happens to disagree with their position – but that’s an issue in itself for another time), I’m not saying I like the situation as it is; instead I am simply describing reality as it is. Ron Paul, Tom Woods, and anyone else are welcome to disagree all they want, but simply disagreeing with reality does not alter its existence. And since it is reality with which we must deal, and since the nullification road has already been shown to be a dead end, we need to get smart and engage in tactics which actually stand a chance of working.
Given the state of Constitutional Law, it’s too late to attack the issue of overturning Obamacare primarily through legal “tricks” in state legislatures; instead, the primary path to attack this issue is through a wholesale change of the federal-level legislative and executive branches, backed up with strong state legislative and executive branches. The only way to make this change happen is through changing the “hearts and minds” of individual citizens.
We need to once and for all wake people up to their responsibility as citizens to be informed about not only issues and candidates, but about the structure and function of our representative Republic. People must learn to read the Declaration of Independence, the Constitution, and the writings of our founders in order to understand what ought to be, coupled with reading Constitutional case law in order to understand what is; thereby being able to devise appropriate strategies to move what is back to what ought to be. We need to ensure the roughly 30% of conservative-minded people who are not currently registered to vote, not only get registered, but also exercise their responsibility to participate in the election process. And the tallest order in today’s environment: we need to get people who’ve been indoctrinated in the “entitlement” mentality to understand that a Big Government nanny state “providing” for them from cradle to grave is not freedom, but bondage.
In short, the way we win is by causing a fundamental shift in world view back to traditional American values and principles.