Monthly Archives: April 2012

Garbage & Taxes

27 Friday Apr 2012

Posted by in Political Ramblings

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Long before I lived in Missouri, I had adopted a philosophy of “walking quietly.”  The idea was to disturb as little as possible as I traveled through life.  Today, the popular phrase “leaving a small footprint” is fairly synonymous with my thinking.

When recycling arrived, I thoroughly embraced it largely because it fit in with my philosophy.  I would have engaged in composting but, given my talent for creating brown rather than green plants, activities associated with gardening were not under consideration.

In Missouri, largely due to my recycling efforts, I would put out on the curbside one bag of garbage every two or three weeks.[1]  Typically, I produced only one bag of garbage each month. Many of my neighbors, on the other hand, were producing 3-5 bags of garbage on a weekly basis.

Having a laid-back disposition, I didn’t fret about this difference in my neighbors’ and my relative contributions to the landfill.[2]   Consistent with my “walking quietly” approach to life, I figured if they wished to produce garbage rather than recycle, so be it.  For me, recycling was the better choice. Then I discovered something that shook my world to its foundations. It turned out that my neighbors and I paid the exact same fee for garbage pickup each month.  In other words, I was subsidizing my neighbors’ choices.  I began protesting that, rather than one flat fee per month regardless of usage, the cost of garbage should be based upon the amount of garbage produced.  In the course of my protesting this outrageous situation, I discovered something far more dark and odious.

I was told that the reason that my “pay for use” approach wouldn’t work was that it would put a greater burden of the cost for refuse disposal upon larger families. This would be extremely prejudicial against those families.[3]

I have nothing against people who want large families.[4]  If Catholics, Mormons and other religious conservatives feel that excessive and uncontrolled procreation is part of God’s plan, let them at it.  Is it reasonable, however, to expect others to subsidize their choices? Should everyone else pay extra in taxes and a greater share of government expenses so that those who choose to have a large number of children don’t pay the full burden of the cost associated with their choices while reaping the full benefit of the services?

I think that in a society where everyone is affected by the procreation choices of others, it is reasonable to place limitations upon the impact of those choices. People should only be given child credit and assistance for up to three biologically-related children that they either father or mother. I am not saying that anybody is prohibited from having more than three children.  All that I am suggesting is that if people want additional children, they should carry the full cost on their own.[5]

I understand that my suggestion might upset Catholic bishops and other religious conservatives who feel that birth control, be it contraceptive pills or coitus interruptus, is sinful.  I can respect their position.  Such a plan as I suggest would be, they could argue, discriminatory against people holding certain religious views because it would ultimately force them to pay higher taxes and pay more for services.  Those religious conservatives are possibly right.  I, on the other hand, am definitely right when I say that the current system forces everyone, who has three or less children, to pay higher taxes and fees and thereby they are compelled to finance another person’s religious beliefs.  The way I see it, this is a violation of 1st Amendment protections against intrusion of religion into government.

There is a solution, however, that allows those, who believe that contraception is sinful, to avoid sin and at the same time it doesn’t raise the tax and fee burden on everyone else.  Abstinence.  If Catholics, Mormons and other religious conservatives don’t want to pay the costs associated with having more than three children and they don’t want to use birth control, let them abstain from sex altogether.  According to conservatives, abstinence is all that is needed to prevent pregnancy.

But who cares whether Catholics, Mormons or other religious groups have sex or not?  I don’t.  What I care about is fairness.  Fairness means, in part, that people should pay their fair share.

Currently there is a debate in the United States regarding the so-called Buffett Rule. This is the idea that anyone whose net income is over one million dollars per year should pay a 30 percent tax rate.  Democrats like this plan, saying that this will create fairness by giving the wealthy a tax rate comparable to the typical American middle-class taxpayer.

Republicans, on the other hand, argue that the Buffett Rule is nothing more than a blatant example of class warfare. Republicans want to reduce the tax rate, they claim, so that everyone is paying the 14 percent rate that Mitt Romney does.

The problem with both of these plans is that neither one effectively addresses how to pay for essential government responsibilities.  Furthermore, neither one would appear to pay down the debt that the Bush-Cheney administration accumulated so it could give tax cuts for the wealthy, enter into two wars, and artificially ward off a recession that had been brought on by the antics of major players in the energy industry e.g. Haliburton and Enron.

During Bush Jr.’s presidency, the Wall Street Journal editorial staff, taking the bull by the horns, addressed the Democrat’s class warfare upon the wealthy stratagem by arguing that the poor should start paying taxes on their income.  They felt that by “feeling” the pain of taxes, the poor would gain an understanding and become sympathetic to the pain and suffering of the wealthy.  With this new insight into the tortured lives that the wealthy faced, the poor would rise up and demand the elimination of taxes.  To be honest, I’m not sure that the subjective experience of finance-related pain is the same for a millionaire who, given a 14 percent tax rate, is left with only $860,000 and a poor person who is left with $8,600 after paying $1,400 of their 10k/year income.

Nonetheless, I am sympathetic to the essence of the Wall Street Journal’s argument.  I believe that the financially-related pain associated with the cost of running things should be distributed as a function of the benefit one derives from the outcome of those costs.

Government has two primary purposes: to protect its citizens and to create conditions which benefit everyone and allows each person to excel to their fullest potential.  In this day and age, government facilitates the development, production and transportation of goods by creating and maintaining highway systems, shipping, railways and airports and air travel.  It is the government’s duty to insure training and education so that people can perform the requirements of the jobs that are associated with those areas of business as well as develop the ideas that lead to innovations and new jobs. Only the government has the resources needed to gather together the critical elements needed to conduct basic research[6] which provides the foundation that is necessary for those inventive and creative minds to come up with and develop new ideas. It is necessary for the government to be responsible for the health of its populace in order to maintain a healthy workforce and viable national defense.  It is these things, combined with the inventive ideas and hard work of the people, that creates wealth. Wealth cannot be created out of wealth. Given this singular fact, wealth can never create jobs.  Wealth is the outcome of labor, not the source of labor.[7] Finally, government is responsible for creating and maintaining the military and law enforcement.[8]  Historically, the main purpose for the military and law enforcement is to protect the wealth that has been created by the labor force.

In broad brushstrokes, these areas of government activity represent the total cost of doing business for a modern country like the United States. It only seems reasonable to expect people to pay their share of these expenses and have that share based upon the proportion of benefits they derive from these costs.  If you are the 10% that owns over 70-90% of the wealth, you should pay 70-90% of the cost for creating, maintaining and protecting that wealth.  If you are part of the 80% who share less than 10% of the wealth that is produced, your group’s share of the cost of doing business should be less that 10%.

This approach is the only way to insure a tax system that is fair while at the same time paying for the cost of doing business and paying down the debt.  For those in that 10%, who feel that having to pay approximately 80% of the costs is unfair, there is a solution.  Make sure that the wealth is more equitably distributed.  After all, the more people who share the wealth of a nation, the more people who can shoulder the costs of the wealth.

It’s kind of a trickle-up economic model.

One of the things that I have noticed in this debate about taxation is that the people, who are the most vehemently opposed to an equitable tax system, are those people who haven’t really earned their wealth.  These are the people who have inherited their wealth or spend their time buying low and selling high.   On the other hand, those individuals who have labored for their wealth or have worked hard creating a business are the ones who support a more equitable tax code.  I can only assume that that is because someone who is smart enough to create a multibillion dollar business with thousands of employees is also smart enough to appreciate how important the infrastructure and other individuals were for them to become financially successful.

[1] During the summer, which is six months in Missouri, I needed to put out garbage bags for pickup every two weeks because the sweltering humidity tended to accelerate the reproduction of nasty smelling creatures.  During the winter, which made up the other six months, I could wait longer to put out garbage for pickup because things tend not to rot as quickly in the cold.

[2] I prefer taking a laissez faire approach towards my neighbors.

[3] Being consistent with this line of thinking, it should be remembered that in 1998 and 1999, Missouri had a surplus in revenue, a tax-expenditure outcome that is forbidden by the Hancock Amendment. To accommodate the law, the Democrats, led by then-Governor Mel Carnahan, suggested reducing or eliminating the sales tax on food.  Their argument was that this would help low-income families.  The Republicans wanted to refund the money.  Their argument was that providing refunds was the only fair solution because elimination of the sales tax on food would place an unfair tax burden upon the wealthy.  After Carnahan died in the airplane crash while running against John Ashcroft for senator, I received two checks for a dollar each from the State of Missouri.  That was my share of the tax surplus. This outcome seems reasonable.  After all, how could two measly dollars benefit a poor family?  I, on the other hand, was able to afford half a pint of beer.

[4] I do admit squirming uncomfortably when I see the photographs of Mitt Romney’s rather huge family.  After all, in a world with finite resources and shrinking space, it is one thing for him to take a disproportionate amount of the resources.  But why must he subject the rest of us to so many examples of his particular gene pool?

[5] Of course, there would be child credits and support for any adopted, fostered or child dependent who isn’t a biological son or daughter.

[6] Nothing could be a better investment than basic research with a return of four dollars for every dollar invested.

[7] This does not mean that all wealth is derived from labor and all labor results in wealth.  There are plenty of examples of people who work hard and have access to very little wealth while at the same time there are plenty of people with extremely large amounts of wealth who did not work for it.

[8] The government’s control of these bodies is important because any privatization of the military or of law enforcement will ultimately lead to tyranny.

The Threat of Smiling Canadians Part II

16 Monday Apr 2012

Posted by in Tales of Canada

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I have known one or two couples who spend much of their time apart, living in different spots on the continent, and they appear to be quite happy.  Nonetheless, I don’t think I have ever had a discussion with a woman who has said that she was looking forward to being married to a man who was never around.  Certainly no woman who would have considered marrying me would have expressed such a sentiment.  Even if someone had, I personally believe that marriage is far more enjoyable and fun if one lives in the same house as one’s spouse.  If that isn’t possible, you should at the very least live in the same country.

Since I wished to live under the same roof as my Canadian wife, I had to go through the process of obtaining permanent residence.  Of course, my wife could have moved to the United States, but Canadians tend to hold some funny views of the United States.[1]  It was a long and expensive procedure that required me to prove that I was worthy of a Canadian woman.  The final steps in getting permanent residence status involved acquiring official documents.  These documents required photographs.  In every case, my “green” card, my health card and my driver’s license, I was told explicitly not to smile.  If there was even a hint of a smile in my eyes, the photograph had to be retaken.  This was very different from the States when the person taking my driver’s license photograph insisted that I put on my happy face.

It wasn’t always this way for the Canadians.  There was a time when all official Canadian documents had photographs of a smiling citizenry.  But that changed during the Bush-Dick Cheney presidency.  Sometime after February 2006, the U.S. government told the Canadian government that they were going to stop accepting travel documents showing smiling Canadians.

On the Canadian side of the border, it isn’t exactly clear why the Bush-Dick Cheney administration wanted to rid the world of happy looking Canadians.  True, the Canadians had refused to participate in the invasion of Iraq.  However, the Canadians had shown total friendship and support for the United States by flying cover for the U.S. during the days following 9/11 and had sent troops into one of the most dangerous and violent areas in Afghanistan to die in the war on terror.  Despite these facts, the Bush-Dick Cheney government had one of their little hissy fits and took several steps to punish the Canadians economically.[2]  Their actions ultimately contributed to the collapse of Paul Martin’s liberal government and the rise of Stephen Harper’s conservative government.[3]

The reticence of the Canadians to die in Iraq as well as Afghanistan is unlikely to have had anything to do with the Bush-Dick Cheney “no smiling Canadians” policy.  The Canadians had already been punished for their refusal to participate in the invasion of Iraq and Stephen Harper’s government was already established when the U.S. government informed the Canadian government that they didn’t want to see any happy Canadians.

So why aren’t Canadians allowed to smile anymore?  None of the officials who took the photographs for my Canadian papers knew the answer to that question.

It is possible that the Bush-Dick Cheney administration may have simply wanted to protect the American people.

If you recall, at the beginning of the Bush-Dick Cheney presidency, the tech bubble had finally burst.  This quite possibly wouldn’t have had any devastating impact upon the economy.  However, the energy industry had also helped to destabilize the U.S. economy with their price-fixing shenanigans.  So by the summer of 2001, when the Bush-Cheney administration had finally gained its footing and was ready to take up the grand battle in the Cold War with the Soviet Union[4], the U.S. economy was beginning to move towards a recession.

The Bush-Dick Cheney administration denied the existence of any recession.  I think they were trying to help Americans by tapping into “children’s magic.”  You know, the old, “If I close my eyes and say that it doesn’t exist; then it doesn’t.”  Of course, cynics at that time were claiming that the American people preferred a government that denies ugly facts.

The Bush-Dick Cheney White House weren’t a bunch of simple-minded fools.  They did much more than deny the existence of facts.  They encouraged the American people to treat each day like it was payday[5].  Then they distracted the American people from their economic frailty by invading one country to go after a real villain whose threats they had ignored, then stopping halfway through and well before completing the original mission, they spun around to invade another country to go after a guy who had been the villain du jour a decade earlier in another Bush administration.  Bear in mind that that guy’s big sins[6] as they affected the United States were to fight a war of attrition with the Iranians, the sworn enemy of the United States, and he invaded Kuwait, a country packed full of rich and spoiled people.[7]

It was clear that the Bush-Dick Cheney administration were students of history.  They had seen the 1920s and they knew that voters would be happy if they were encouraged to live like there was no tomorrow.  They had seen the Roman Empire and they knew that the path to the rabble’s heart, I’m sorry, the citizens’ hearts, was through blood sport.  No one looking at the administration’s actions could really deny that the Bush-Dick Cheney gang was truly concerned about the happiness and welfare of the common people.

But the Bush-Dick Cheney administration wasn’t about to take half measures.  To make the American citizens feel even better, the administration lowered the taxes on the wealthiest following that old adage, “When the rich are happy, the whole world sings.”  They also continued the deregulation of the banking and financial sector that had begun during the Reagan years.  These steps made sense because it was these bankers and capital investors and the rich who were the true job creators.  Everyone knew that it would be their choices that would help America climb out of the recession that wasn’t really happening.  And I am sure that most people have a pretty good idea of what history will have to say about the Bush-Dick Cheney gang’s theory of economics.

In a further demonstration of their absolute love for the American people, the Bush-Dick Cheney administration took steps to help the American people avoid being bothered with a few pesky details, such as how to fund two wars, let alone fund other government responsibilities, after the tax cuts.  So, to keep the American people feeling good about themselves as well as to keep the economy moving while waiting for their economic seeds to grow, they borrowed hundreds of billions from the Chinese and created an artificial housing boom.

All in all, when looking back over the way the government handled its responsibilities during those eight years, one wants to be impressed with the brilliance of the Bush-Dick Cheney administration.  Every step of the way, the Bush-Dick Cheney gang showed how much they cared about the happiness of the typical American.  But there was a fly in the ointment.  And that fly was the damned smiling Canadians.  How were the American people to truly believe that they were the happiest people on the planet if they saw photographs of Canadians smiling?

True, the news organizations helped the administration by reporting on a daily basis about how all of the miserable Latino-types were trying to sneak across the border and snatch the food right from our children’s mouths.  As long as the American people looked southward, they would be assured that life could be worse.

But what if they began to look northward?  They would see 32 million people who were happy AND they weren’t Americans.  That simple fact could undermine all of the hard work that the Bush-Dick Cheney administration had done.  So, to help the American people, the Bush-Dick Cheney administration did what they could to wipe the smile off of the Canadian face.

And that is the reason that I believe the Canadian people are no longer allowed to smile.

[1] For example, my wife, like most Canadians, considers the United States a violent and dangerous place to raise children.  I’m always perplexed as to how she can come up with such bizarre notions.

[2] It is important to note that it seems the Canadians haven’t forgotten any of this.  Several times now, George W. Bush and Dick Cheney have had to cancel scheduled appearances in places like Toronto.  It seems to a casual observer that they aren’t well received.

[3] Canadian conservatives should in no way be confused with American conservatives.  Though they may have a common ancestor in the distant past, they are two distinct species following very different evolutionary paths.  Conservatives in Canada are actually similar to moderates in the U.S.  I am unaware of any Canadian factions that would claim ideological “brotherhood” with the conservative wing of the modern Republican Party.

[4] I know…the Soviet Union had collapsed a decade earlier.  Unfortunately, the only person in that administration who seemed to be aware of that was Colin Powell.

[5] Or did they tell Americans that it was their patriotic duty to “spend, spend, spend” to help finance the war?

[6] I am completely aware that Saddam Hussein gassed his own citizens, the Kurdish rebels.  However, my position is that the only people who can use this act to vilify Saddam are those who protested the continued U.S. support of Iraq back in the 1980s; such as me.  If you supported the Reagan policy of overlooking the atrocity of Saddam using chemical weapons on his fellow Iraqis, you have no right to complain at some later time.  Evil can’t be contextualized with a “different time” rational.

[7] Keep in mind that the Kuwaiti youth were dancing in clubs in Cairo while American youth were putting their lives on the line to drive the Iraqis out of Kuwait.