We are a commune of inquiring, skeptical, politically centrist, capitalist, anglophile, traditionalist New England Yankee humans, humanoids, and animals with many interests beyond and above politics. Each of us has had a high-school education (or GED), but all had ADD so didn't pay attention very well, especially the dogs. Each one of us does "try my best to be just like I am," and none of us enjoys working for others, including for Maggie, from whom we receive neither a nickel nor a dime. Freedom from nags, cranks, government, do-gooders, control-freaks and idiots is all that we ask for.
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Monday, September 6. 2021
I repost this about every four years. I think, a good reminder. Below is a repost of a column I wrote at another venue for Labor Day 2006 and posted again here in 2011 and 2014 and 2018:
What remains of Labor Day? Some speeches about the hard work of our parents or grandparents, and some newspaper articles about current difficulties getting established or obtaining benefits for today’s workers.
Conservatives are distinguished by particular respect for the hallowed history from which current and future advantages spring, without which we would be rootless and at the whim of passing fancies or incitements.
Supposedly, the virtues and rewards of hard work are among these cherished principles.
The Left trumpets redistributive schemes from the affluent or hard working to the poor or lazy, most of which have relatively little benefit to the poor but create newly enriched bureaucrats and union leaders.
Conservatives’ answer is usually more along the lines of how to preserve and protect the fruits of the labor by those in the middle and upper rungs of the economic ladder.
Sebastian Mallaby steps on the Left and Right’s toes today in the Washington Post.
Mallaby points out the futility of most of the Left’s prescriptions, to the “point the left begins to seethe.” He then focuses on reducing tax incentives that mostly accrue to the middle and upper classes, to free up a quarter of them for $180-billion that could be used for increased earned income credits and reduced regressive payroll taxes.
The problem with Mallaby’s arguments is that they are another, albeit better, form of redistribution, and government has repeatedly proven its penchant for wasting such billions on other than targeted needs. More necessary is the unbridling of energies and rewards for labor. That requires investment which creates demand for labor, and skills-oriented education that creates competitive wage earners to fill those new openings.
As Mallaby correctly argues, many of the poorest workers are in service trades not impacted by international competition. Such positions that were once beginning rungs on the ladder now face a gap of steps up due to lack of skills.
Instead of redistributing tax incentives, more needed is redistributing our already huge tax outlays on education from schemes that create administrative and union positions, and posh campuses, toward greater vocational and skills education.
That honors labor, by providing the tools for all to benefit from labor.
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"...more needed is redistributing our already huge tax outlays..."
How about we just shitcan those? No? The answer to government wasting all of our money is not trying to get them to spend it more wisely, but to never let them get their filthy hands on it in the first place.
Seems to me, the concept that tax 'incentives' tend to accrue to the middle and upper classes is just wrong. In other words, it's wrong if it were true (it's not, exactly, since the middle and upper classes still pay the lion's share of revenues which head to the government) and it's wrong to think it's somehow "wrong" for this to happen.
This mindset of 'benefit' for the middle and upper classes ignores many things.
First, that these are the income groups which create jobs. Money which is added to their coffers doesn't just sit on the sidelines or pay for yachts, vacations and $10,000 meals. It's invested or saved, for the most part - and both of these actions create jobs. More importantly, even if it was spent on vacations, yachts and $10,000 meals, it still creates jobs. The only way it doesn't create jobs is if the money is stacked into a warehouse somewhere and just sits there.
Second, it presumes that the lower income groups aren't somehow benefiting. Well, if the income is low enough, you're not paying a dime. So that's a benefit, and a pretty big one. In fact, with our current system you're also getting other food/income/health benefits for no cost or reduced cost.
The reality is, even with our outdated tax and redistribution schemes (and they are schemes, they haven't been properly reviewed and updated in years - Obama's work was just to give shit to people he liked and knew would vote for him - pretty much standard machine politics), the lower income groups have all improved their position in life.
I recently met with members of my own extended family who are not as well off as I am. As several complained about their income and their state of affairs, I pointed out a few things to them. They all had smartphones and were spending time texting or posting on Facebook and using apps of various kinds. This is an astounding thing, not even available 10 years ago to as many people as today. 20 years ago, the cost of having all that in your hand (music, phone, computer, etc) would have exceeded thousands of dollars - assuming you could actually FIND any of it that fit in your hand outside of the phone itself. They all arrived in new, or relatively new, cars. Several had recently had work done on their homes to improve them.
This isn't to say that my family represents the poorest of the poor. They don't. But they certainly are (and every one of them knows this) in lower middle income categories.
I'm also not saying I don't feel bad for people who aren't as well off as I am - or even if they aren't as well off as others in my family. I do. But I don't believe we benefit these people at all by giving them things. They need assistance, but they also need incentive.
Finally, when it comes to taxes, one thing is clear. Income taxes are not working and are broken. It's too easy to hide, it's too easy to move, to shift, to otherwise reduce your income. We all find ways to do it. A low, flat, tax would be preferable, but it should impact everyone.
However, I'd prefer a very low tax on each purchase or sale of financial instruments. Commodities, bonds, stocks, currencies, etc. If you applied a .3% tax on the purchase or sale of all of these things (low enough to not radically change investment strategies outside of making short term investments slightly less lucrative), you'd raise more than enough money to finance the current federal budget without borrowing money. And you'd only impact the very wealthiest.
The other key point is that because it happens at the point of transaction, it's not taking money directly from 'someone' but rather it is taking money from the transaction itself, during a shift in ownership on either side. This is a purely philosophical concept, but it's one which is pretty well established to reduce the view that a person is being 'taxed', and it avoids the 'pass along' costs which typically come with standard sales taxes, because both sides of the transaction are taxed.
Obviously, something like this will never be employed. But it would be in line with our current economic structure, in which inflation is created, the soaked up by asset markets and the Fed through the expansion of its balance sheet. It's a modified version of the Tobin Tax with a mix of Chartalism (though I specifically eschew Chartalism since it's a false premise).
I don't believe we can ever design a system which all will love and believe "works" - that's just too much wishful thinking. But I do believe we can design systems which are more effective at achieving realistic goals.
Taxes, though necessary, are more like a parasite infection. You can live while infected with parasites but it destroys the quality of your life and robs you of lifes pleasures. And with enough infection it destroys you after long suffering. This is exactly what taxes do to the middle class and businesses. The balance is essentially who much can the government destroy you (take from you) without killing you! And THAT is the level they try to operate at. Imagine if your property tax was a flat fee. After all it doesn't cost the fire department more to save a $200K house from burning than it does a $400K house. It doesn't cost the school system or the police department more if you choose to buy a more expensive home. The property tax should simply be X dollars per unit regardless if the unit is a one bedroom apartment or a 3000 Sq/ft home. Then people could afford to buy a nicer hose without being hit with excessive taxes.
The same is true for income taxes. If you want to work overtime or two jobs you shouldn't be penalized for it OR penalized at an ever increasing rate (progressive taxation). A flat tax is a better system with zero deductions and exemptions. (Except that businesses of course would be allowed to exempt their actual costs and overhead from their taxable income).
Taxes are used to punish and reward and that isn't just or constitutional. Also the rich lobby for taxes that they can avoid and only the middle class end up paying for. This type of system isn't fair and cannot sustain itself.
Funny how discussions of tax policy always begin with civic principles, the responsible sensibility of citizens looking after their society and contributing back to improve its condition and strength on behalf of all; but these discussions never seem to conclude with a similar commitment of fiscal responsibility and principled, disciplined frugality at the spending end, by the wise government these citizens are paying homage to.
There is an excellent thread today on the origins of Labor Day, the coal miner's rebellion that reached its conclusion 100 years ago today:
”Today is 100th anniversary of the surrender of West Virginia miners to federal troops at Blair Mountain, ending the largest labor uprising in US history, and the most serious insurrection since the Civil War.”
What an 'insurrection' really looks like.
I would not throw additional money at the traditional college system, which has been largely taken over and ruined by the woke movement. Instead I would try to resurrect the tradition of apprenticeship. Employers of skilled workers know what skills they need workers to have, and they're not the ones colleges provide.
I would also do away with the minimum wage, whose main effect is to prevent many handicapped people from participating in the work force. Indeed, that was its intended purpose, stated loud and clear in campaign ads during the early-20th-century period when most minimum wages were enacted. The prospect of the market producing unreasonably low regulat wages is an unlikely fairy tale.