Are tax cuts for the rich moral?

The tax cut issue is not just a tax cut issue. It is also a discipleship issue. What does your Bible reading and theology inform you to say about the tax cuts?

From WaPo:

Are tax cuts moral?
A deal President Obama struck with Republican leaders last week will extend tax cuts across the board including, controversially, to the richest Americans.

Some politicians argue that religious values should be reflected in the public square. Should this faith-based view of politics be applied to the economy? Jesus said, “Whatever you did for one of these least brothers of mine, you did for me.”

In a time of economic turmoil and record poverty levels, are tax cuts for the wealthy moral?

About Scot McKnight

Scot McKnight is a recognized authority on the New Testament, early Christianity, and the historical Jesus. McKnight, author of more than fifty books, is the Professor of New Testament at Northern Seminary in Lombard, IL.

  • chris giammona

    Scot

    This is certainly a complicated issue and the comments on the posted web site seem to miss one relevant point in the debate – How do you define rich?

    For example: one emphasis in the debate is that the definition of rich is a couple making $250,000. While there are many places to live in this country where that income level is considered “living like a king”, that would not apply to places like New York City, Los Angeles, Chicago, San Francisco, or other major cities where the cost of housing is very high.

    I would certainly agree that our tax system today is not equitable and the loopholes favor the higher incomer earners.

    Chris

  • Robin

    Just to set the field a bit:

    The upper 1% earned 19.6% of total income before tax, and paid 41% of the individual federal income tax. 47% of citizens pay no Federal Income Tax whatsoever. A recent study published in the Journal of Economic Perspectives (2007) by professors from Paris School of Economics and UC Berkeley found that America currently has the most progressive income tax system in the world and it has the highest tax ratio/income ratio for wealthy individuals in the world.

    Marginal tax rates might be low, but a generous helping of tax credits and deductions (standard and otherwise) ensures that half of Americans either pay $0 in income tax (the tax cuts we are discussing) or receive, rather than pay, income tax.

  • Robin

    What does the bible suggest about either taxes, or the rich?

    I think it is clear that there should be no preferential treatment for the rich, so I would certainly be opposed to giving them a lower tax rate than everyone else.

    I think it is clear that business practices which favor the powerful over the less powerful are anathema (honest weights and measures), so I would be opposed to tax policies that are designed to only be available to people with very good estate lawyers, like the Kennedy’s propensity for sheltering their inherited income overseas.

    Beyond that, I cannot think of any principle that wealthy people should bear a “more than proportional” share of civic costs. The rich young ruler had to sell everything he had to inherit eternal life, but that is a soul issue. Ananias and Saphira were free to keep, or sell their property, as long as they told the truth about it, etc.

  • Robin

    When I say “I think it is clear” above, I mean that I think scripture is clear on this point.

    I think Christians, especially wealthy Christians, SHOULD be welcoming of a tax system that provides more generous benefits even at the cost of higher taxes, and I think they SHOULD be giving personally to charities to an extent that the “suffering” they experience from lost income approaches the “suffering” of the widow when she donated her last two pennies.

    I think these are the things that a heart alive to God, desiring to “Do justice and love mercy” will naturally be pushed to, but at the same time I think it a mistake to say that if a Christian fails to sell everything and give it to the poor, or support 55% inheritance taxes, or trade in their house for a communal living situation that they are necessarily immoral or living in sin.

    Even if it makes me a theocrat I have no problem calling out government policies that scripture clearly condemns (favoring the rich, unequal weights and measures, murder of innocent children, etc.) But I do have a problem calling out governmental policies or personal choices that run counter to my personal convictions but are not clearly unbiblical (insufficiently progressive taxation, luxury car ownership, church building construction, universal health INSURANCE, etc.)

  • Robin

    I’m done for now, sorry I posted so much, but it was one really long thought.

  • Rick

    Isn’t the morality of it partially determined by the “why”, the motivation?

    If it is simply the reason of doing the wealthy a favor, and putting the burden on the backs of the the “unwealthy” (think: Solomon and son), then it would appear to be immoral.

    However, if the reason, or at least part of the reason, is because it makes economic sense (more money to spread around, invest in businesses, jobs, etc…), then it would seem moral.

    Do some disagree with this policy because they don’t think it works, or because they think it is immoral? The two are not always the same thing.

    I hope Mr. Kruse joins in on this discussion.

  • David Himes

    Tax cuts are amoral — just as taxes, in general, are amoral.

    Every faithful believer should be following the tax laws. And every faithful believer should be living in a way to glorify God … which includes how he/she utilizes the monetary resources available to them.

    If we favor tax cuts, because we’re greedy … we’re not loving as Jesus loved.
    If we oppose tax cuts, because we want to take money from those who have it … we’re not loving as Jesus loved.

    Jesus called upon us to change hearts, not change the tax laws.

  • Robin

    I had another thought. I tend to think of the OT sacrificial system (as well as tithing) as a kind of “tax”. What do we learn about the heart of God from such a system?

    It was progressive, sort of, but not in the way we think of progressivity. The standard being advanced by progrssive is “low tax rates for almost everyone, higher tax rates for the rich” The sacrificial system advocated a universal sacrifice for all income classes, except the poor, who were usually able to suffice with a simple cup of flour. So, an income tax system with zero taxation for the poor and proportional taxation for everyone else certainly seems in line with biblical principles.

    Secondly, we know that the progressive tax system I described above was a minimum requirement and still didn’t impress God. The wealthy man that donated at the same time as the widow wasn’t hailed for keeping the law but scorned for keeping it self-rigtheously, and the rich young ruler, who surely kept the law on such matters, still loved his possessions too much to be a Christ follower.

  • SFG

    “Jesus called us to change hearts, not change the tax law.”

    So in the South Africa of apartheid, which was over 90% Christian, followers of Jesus should not have worked to change the law? Or in the American South of Jim Crow laws, which again was 90% Christian, the civil rights movement that was lead by the Black Church was not doing the work of Jesus?

    You might say that if hearts are changed, the laws will follow, but this clearly is NOT usually what happens. For “the Kingdom to come and God’s will be done” often involves working to change laws.

  • Barb

    “to whom much is given, much is expected”
    any tax cut that I get definitely appeals to my greedy nature–more for ME.
    I don’t believe that super rich need tax cuts. I don’t believe that it will hurt small businesses.

  • Linda

    Robin, I disagree with you, since God forbids unequal or progressive taxation system (Ex 30:14-15, and Lev 19:15). God established, as an example, in the government of Israel 10 biblical principles of freedom and one of them was:

    A free market economy based on the private ownership of property (Exodus 20:15,17; Deut 19:14) and individual free enterprise (Eccl 5:19; Prov. 10:2-4; 12:24: 13:4,11; 1 Thess 3:10). Any taxation of 10% or higher was defined as oppression (1 Samuel 8:10-18), and any taxation of property, or of inheritance, was strictly forbidden! (1 Kings 21:3). Institutions and individuals involved in the full time service of the Lord were not allowed to be taxed (Ezra 7:23,24). Any unequal or progressive system of taxation was expressly forbidden (Ex. 30:14-15; Leviticus 19:15). Biblical economics also forbids unjust weights (unbacked currency) and measures (inflation) (Leviticus 19:35-36; Prov. 11:1; 20:10; Amos 8:5-7; Micah 6:11,12).

    -excerpt from “Biblical Principles of Government” at http://www.frontline.org

  • PaulE

    “Do not pervert justice; do not show partiality to the poor or favoritism to the great, but judge your neighbor fairly.” – Lev. 19:15

    Perhaps a corollary question: Is it moral in economic turmoil to uphold taxes for the rich even while taxes are being cut for everyone else?

  • Robin

    Linda,

    I don’t know if you are serious or playing devil’s advocate, so I’ll take the bait.

    First, progressive “taxation” was certainly allowed in the sacrificial system. Here are some citations where poor worshippers were permitted to offer less costly sacrifices if that was all they could afford. Leviticus 5:7,11; 12:8; 14:21,32.

    It is immaterial that the shekel in Exodus 30:14-15 is tied in with the census and therefore looks more like a tax. It was an offering for atonement and redemption from the Lord. Maybe someone more knowledgeable that me can explain why this atonement was a flat tax while the other offering are progressive taxes, maybe there is something in the atonement picture that differs from wave, sin, and guilt offerings.

    Exodus 30: 14-15 is also a bad example because it was a head tax, unless of course you are advocating replacing the federal and state income taxes, state and local sales taxes, social security tax, FICA, UIB, etc. with a simple head tax as determined by the census. Any income tax, even a regressive income tax, is by its very nature more progressive than a head tax because it has income as its basis. Like I said above, I think this is moot because other parts of the sacrificial system are clearly progressive.

  • http://kingwatch.co.nz/Law_Government/voluntary_taxation.htm Blessed Economist

    Are tax cuts immoral.
    Taxes are immoral.

  • Linda

    Robin, was not the OT sacrificial system entirely voluntary, and there was no penalty enforced by the government if you did not give? Whereas if I do not pay my taxes the IRS can penalize me and even throw me in jail for not paying my taxes. Do you not see the difference?

  • Robin

    Linda (continued),

    1 Samuel is also a bad example because it isn’t “everything above 10%” that is clearly defined as oppressive, but the confiscatory actions of a monarch. The point of the passage isn’t that 10% taxes, or even higher taxes are bad, it is that monarchies, by their very nature, lead to confiscatory regimes. The passage would have just as much weight as if he had used 5% or 25%, the point was that the king would be a tyrant and he would take the best of everything.

    Furthermore, it is prescriptive…telling us how we should conduct business, it is a warning…telling us about the dangers of a monarchy.

    Lastly, I don’t know how that passage would look if the children of Israel had cried out for a representative republic in which they elected their leaders to finite amounts of time and they, through their representatives, set tax rates on themselves. “You will vote 10% tax rates on yourselves, and take the best of your flocks, and redistribute them amongst yourselves, because that is what you will choose to do through majority votes and supermajority requirements, and elaborate filibuster rules.” I don’t think that passage tells us much about biblical tax policy in a government where we get to vote in our leaders.

  • Linda

    Robin, do you have any comments on?:

    Any taxation of 10% or higher was defined as oppression (1 Samuel 8:10-18), and any taxation of property, or of inheritance, was strictly forbidden! (1 Kings 21:3)

    Surely the US government is not following this biblical principle for government!

  • Robin

    Linda,

    Most of the other stuff I agree with. We have preserved tax-exempt status for churches and other charitable organizations.

    I don’t think the OT system gives us a clear 1:1 model for setting up a tax system, but that the OT system and the entire bible for that matter, give us principles for how to deal honestly and justly with one another.

    As to the voluntary nature, I’m not sure about this, can someone else say if it was truly voluntary, regardless, even if it was the implication is still that if you didn’t make your offerings (while being able to) that you weren’t a believer and your sins were not forgiven, a much worse punishment than IRS troubles.

    I think we also have to talk about taxing and spending policy. Are you of the opinion that the government has no legitimate authority to do things like build bridges, operate police departments, etc.? Are you essentially a Christian anarchist? If so, I can understand why you think a simple census driven head tax is sufficient (although the head tax probably wouldn’t even be sufficient to pat for the census). However, if you think government can legitimately build roads and bridges, establish a currency, provide police and fire protection, etc. then it is clear that additional, non-head, taxes are necessary and I am in favor of looking for biblical principles to make those as fair and just as possible.

  • Kyle J

    While there are certainly moral dimensions to government taxation and spending, I have a hard time framing the immediate questions facing policy makers in moral terms–we’re talking about the difference between a 36% and a 40% marginal tax rate. Most conservative elected officials are not talking about eliminating progressive taxation with a flat tax. Most liberal elected officials are not talking about increasing marginal tax rates for the wealthy above the range they’ve been in for the last 30 years (30-40%).

    As a political matter, favoring extending the tax cuts only for those with incomes under $200,000 was simply a way for President Obama to beat the tax-cut trap the GOP has been laying since 1980–beating up on those who don’t favor their tax cuts as tax-and-spend liberals, without ever backing up the smaller-government rhetoric with real spending cuts.

    I am slightly hopeful the debate will get a little more honest next year, as both sides have to put forward something resembling a real deficit reduction plan.

  • Linda

    Robin, monarchies just like republics require money to run, so your point is moot – and if I do not pay my taxes the IRS can confisticate my property. But I do not believe in the sacrifical religious system of Israel that a person could be penalized by the government and thrown in jail for not giving sacrificially.

  • Robin

    Linda,

    1 Kings 21:3 is not about inheritance taxes. It is about the right to sell, and to refuse to sell, property and inheritances. More succinctly, it is about eminent domain abuses.

    Ahab didn’t initially try to take the place outright, but to trade for it, or to pay market value. Naboth could have sold the property, it was his right to do so, it was also his right to refuse. Even under the strictest reading of the OT he could have sold it up until the period of the jubilee, possibly up to 50 years, but he didn’t want to do so.

    Since Ahab was ruler his wife devised a scheme to forcibly remove the property through illicit means. I would suggest that the closest modern parallel is when municipalities like New London decide that they want to take property from citizens (like Kelo) and give it to other citizens who will pay more in taxes.

    Either way, this story has nothing to do with inheritance or estate taxes. Other scripture might (I’m not sure) but I know for a fact that this one doesn’t.

    Be honest with me now, are you a Reocnstructionist, or are you just throwing some PBS article at me to play devil’s advocate.

  • Kyle J

    As for whether taxation itself is immoral, one might investigate what sort of scheme of taxation the statement “Render unto Casear what is Caesar’s” was made in regards to.

  • Linda

    Robin, I do know that the government (biblically) is to make the law, enforce the law, judge the law, so they should have armies, and police, and judges, court system, senators, mayors, city councils, etc. But I do not necessarily agree they should be providing fire protection or bridges – fire protection and bridges can and have been done by private companies or volunteers before.

  • Robin

    Linda, even though Republics cost money to run 1 Samuel is still irrelevant. Nowhere in the passage does it say that Israel shall, or shall not, have a tax rate below 10%, exactly 10%, or above 10%. It says that oppressive governments will lead to oppressive policies. One such example of an oppressive policy is a monarch who takes the best of everything, including 10% of income.

    Nowhere does it say what Israel’s tax system is supposed to be, and it certainly doesn’t say that if you elect a representative government you are not free to set tax rates at 10% or above.

    Furthermore, it says nothing about public goods provision. In Ancient Israel (and Egypt) the King confiscated all of this wealth and the only thing he provided was military protection. That is why Samuel says the Israelites will request a King in the first place.

    10% taxes might be oppressive if all we got out of it was an army, but what if we voted for 20% taxes, but got an army, social safety net, roads, bridges, public land grant colleges, etc. Well that might be oppressive or it might not be, you’d have to do a cost analysis to figure that out. Would it matter if we had a unanimous voting rule in place? If we had direct democray and unanimously voted for a tax and expenditure policy then in what sense could it even be alleged to be oppressive?

    1 Samuel provides no answers on tax policy, only warnings about monarchy. I would also suggest it provides warnings about top-heavy heirarchical church government structures, but I’ll leave that fight for another day.

  • http://homewardbound-cb.blogspot.com ChrisB

    “In a time of economic turmoil and record poverty levels, are tax cuts for the wealthy moral?”

    What an odd question. Let’s ask it another way:

    Given that most Americans work for small businesses, and that a significant number of those small businesses pay taxes according to the personal income tax rates, in a time of economic turmoil and record poverty levels, are tax cuts for employers moral?

  • Linda

    Robin, 1 Kings 21:3 has a lot to do with inheritence taxes today because usually the inheritors of a property are forced to sell the property so they can pay the inheritence tax.

    Just like Ahab, the US government is being sneaky.

  • Robin

    Linda,

    Under a strict reading of the OT police, senators, mayors, and city councils would still be unnecessary. All you need is the law, judges, and a judicial system. Ordinary citizens can apprehend criminals and bring them to the judges. You might also need jails and jailers, but you could make due without police and the rest of the politicians.

  • Robin

    Linda,

    If the inheritance tax is designed to rob children of their inheritance, then I can see the parallel to eminent domain abuse. This does not rule out all inheritance taxes, and it especially does not rule out property taxes, which are normally less than 1% of asset value. I work with taxes in Kentucky and our state property tax is 0.122%. That is very different than a 55% tax rate on all assets.

    Again, it isn’t the tax itself that would be addressed by this principal, but the rates and exemption levels that are applied.

  • Linda

    Robin, do you not agree that power corrupts and absolute power corrupts absolutely? If you agree with this then you are foolish to advocate for a bigger and more powerful federal government.

  • Robin

    Linda,

    I too am passionate about the inheritance tax because my father is a farmer and we would have likely lost our farm if the inheritance tax policy had not changed. That is one reason I think the rates and exemptions are important. It is important to note as well that the rate is now 35%, the same as the marginal tax rate for income over $250,000.

    The have essentially said, “look, when you come into any material gain, whether it is lottery winnings, a new home through Extreme Home Makeover, or an inheritance over $5 million, we are going to treat all those transactions the same and tax you on the basis of how they change your income in a given year”

    I don’t necessarily agree with it, but I can understand the logic, and I think they are applying it in a consistent manner. If I win a $5 million lottery, or Ty builds me a $5 million dollar house, they are going to look at that value and tax me at 35%, now they are going to do the same with inheritances. Though if they really wanted to be consistent they would remove the exemption altogether and tax all bequeathments, even sentimental old jewelry and china sets, at the taxpayer’s marginal tax rate.

  • Linda

    #27 (Robin) – yes, how true, under a true theocracy you do not need many people, and when the people of Israel wanted a king then they get taxed and more people are needed to run the government. And did having a king really help the people of Israel? No it did not help at all, therefore you insisting upon bigger federal government (which is like calling for a king) will also not help this country either.

  • Robin

    Linda (29)

    I am a Calvinist, so of course I believe it, and of course I think our government is corrupt and taxes are too high, and we waste alot of money on useless crap. Men are sinful, politicians are sinful, and government is sinful, but I am glad we have a constitution that recognizes this and places some checks and balances on the power of individuals.

    However, there is a vast difference between things I believe, policies I prefer, and issues where I can thunder “Thus saith the Lord!” and speak with biblical authority. I cannot speak with biblical authority on things like top marginal tax rates, head vs. income taxes, inheritance and property taxes, etc. I can speak with biblical authority on giving preferential treatment to the rich, unequal weights and measures, and the insufficiency of keeping the law.

  • Robin

    Linda,

    Are you advocating shredding the constitution, abolishing all Federal, State, and Local executive and legislative branches, eliminating the entire federal and state sets of statutes, as well as 2000 years of common law, and returning entirely to a judicial government guided exclusively by the OT law?

    If you are advocating anything less than that then you too are advocating a form of government that was condemned by Samuel as a law that would not save and would ultimately lead to oppression.

    In the new heavens and new earth we will once have a theocracy with a perfect law, until then all we have are the products of sinful men.

  • Linda

    Robin, you mention property taxes, and that they are only about 1 percent of asset value, you forgot to mention that the government is the one that determines the value of the asset – do you not see how the value of the asset is inflated by the government so they can collect more in property taxes?

  • Robin

    Linda,

    The value of the asset is determined by market value. If I pay $150,000 for a house then it is really worth $150,000. That is its true value.

    It does get complicated when houses haven’t sold in decades, or market values have gone up faster than incomes. I would agree with you that abuses are possible, but I would push for eliminating such abuses, or adopting policies such as assessment freezes so that elderly folks don’t get taxed out of their homes.

    What I wouldn’t do is pull in an unrelated scripture verse and declare that all property taxes are unbiblical.

    It is fine to admit that the system is screwed up in some facets and to work for a better system.

  • PaulE

    Robin (13),

    I’m only making a guess here, but I would venture that the reason both the rich and the poor pay the same half shekel in Exodus 30 is that it is meant to be a ransom for each person’s life. Since neither the rich nor the poor is inherently more valuable to God, it stands to reason that God would require the same ransom amount for each person. Certainly, as you argue, it would be difficult to pull from the passage a principle that God opposes progressive taxes.

  • Dan Arnold

    While trying to read contemporary applications into biblical narrative is a good thing, it is important to try and understand the context a bit first.

    The story of Ahab is not about inheritance but rather how Israel was supposed to be a kingdom under YHWH’s reign. In Israel, because the king was accountable to YHWH (a concession to the people that Israel become like the nations around it), the king could not seize land. Israel and Judah both moved away from the idea of YHWH as king toward a person as king but the king was not the agent of YHWH. In Canaan, where Jezebel came from, the king was Baal’s representative and as such, had the right to seize property. This was completely contrary to the nature of kingship in Israel. Jezebel was employing a Canaanite understanding of kingship in Israel. Israel was not supposed to rely on a king or an army or foreign alliances to protect it, but rather her reliance was to be on YHWH alone. Jezebel, therefore was advocating a way different than what loyalty to YHWH required.

    Incidentally, the right to property was not absolute as demonstrated by the year of Jubilee, where all property was returned to the original clan owner, all Hebrew slaves were freed and all debts forgiven. This was the law and not optional.

  • http://LostCodex.com DRT

    Wow, never thought I would see a Robin vs. Lynda battle. Good show!

    Tax cuts are not immoral, but it is safe to say that the American rich are not going to win any prizes for caring for the underprivileged anytime soon. Further, the arguments proposed around small business case make no sense.

    Small Business Commentary – As a small business owner I understand the whole urgency around ensuring small businesses have enough money to expand our economy and provide employment. Let’s look at it from the notion of results and scenarios.

    First, if I am making, I mean taking home $1 Million a year and this tax goes into effect then I would pay an extra $30,000 in taxes. The high income part is the amount of income over $250k. It would look like this:

    Take home pay on the high income part ($750k) – $480,000
    Take home pay on high income after increase – $450,000

    I don’t think that will make a hill of beans difference in the short term to that person.

    Now take someone closer to the cut off, say $300,000 take home income.

    Take home pay on the high income part ($50k) – $32,000
    Take home pay on high income after increase – $30,000

    Again, this is the difference on top of the income less than $250k. This will not make a hill of beans difference.

    Remember, these monies are on top of money they have already earned. This is not money that is going to help struggling businesses or those that might go bankrupt, no, this is going to help those businesses that are already doing quite well. Makes no sense to me.

    I will put what does make sense to me in the next post.

  • Ryan

    Why do so many people assume that by taxing “the rich” however they are defined means that the poor are helped? Scripture clearly calls us to care for the poor; it does not tell us HOW to do that. Even if it did tell us that still does not mean that taxing “the rich” at a higher percentage rate, creating a Federal government program to channel those resources and identifying the poor to whom the Federal resources will be granted will actually in the end care for the needs of the poor.

  • http://awaitingawhiterobe.blogspot.com MikeB

    I think the first 4 comments Chris and Robin nailed the issue as to the questions involved. How do you define rich, does that definition account for locale, how does one account for the fact that nearly half of wage earners pay nothing?

    The Biblical giving principle is based on a portion of what is earned and everyone gave based on that. 10% (potentially more depending on how one counts the offerings) of what was earned/harvested made everyone a contributor to society. Thus it would seem that a flat tax would be more “fair” and even more Biblical than a progressive system we have right now. Especially given all of the loophole/deductions.

    Going back to the OP – one *could* argue that it is more immoral that 47% of earners pay no income tax if one wants to equate government taxes to morality. We all are citizens of the nation and thus we should all contribute to the costs of running the nation (arguably in a flat proportion to what we earn).

    I really don’t understand why Christians (or anyone else) thinks that the government should get more of our (or really God’s) money. Especially given the poor track record in most areas.

    IMO – the less taxes we pay the more control we have over the resources that God entrusts to us. And as Christians we are called to be generous and glorify God with the resources He entrusts to us (see 1 Tim 6). Therefore we would have even more to give to missions, churches, shelters etc.

    It also takes control from the government determining who would be eligible for help and put that back onto charities and churches where they are better able to assess the true needs.

    We are going to be held to account for how we used what we were given. And part of the assessment is voluntary and generous giving – not how much was forced to be paid to the government in taxes.

    And yes, even if we disagree with the current tax code we are still morally obliged to obey Christ and pay them.

    Just my 2 cents.

  • http://LostCodex.com DRT

    Oh, and speaking of the rich, when are we going to get to swoon over Gates and Buffet and the success they are having?

  • Ryan

    @ DRT and Robin…
    What makes US billionaires so generous?

    “Part of the reason for the apparent generosity of the American super-rich is cultural. While the English aristocracy respected inherited wealth, the Americans revered heroes of industry like Andrew Carnegie, who said that “the man who dies rich dies disgraced”. He was a hand-loom weaver’s son from Dunfermline, who emigrated to the USA, became the world’s second richest man and gave away the whole of his fortune, equivalent to billions of pounds in today’s currency.

    The two richest businessmen in the USA, Bill Gates and the investor Warren Buffet, are following in the Carnegie tradition.. The Bill and Melinda Gates Foundation, set up in 2000, is by a long way the world’s biggest charitable trust, and in 2006 it attracted the biggest single charitable donation in history, of around £20bn, from Mr Buffet. But if other rich Americans – like Mr Gates’s partner, Paul Allen – choose to be much less generous, that is their affair.”

    The Independent June 27, 2007

  • Robin

    Ryan,

    America is awesome and uniquely blessed by God with a manifest destiny. JK :)

  • http://pastormattsblog.wordpress.com/ Matt Rawlings

    Why does the writer assume that taking money from the wealthy (who do tend to invest and spend rather than hoard) and giving it to the government will benefit the poor? The Acton Institutes and many others have demonstrated that our current welfare system hurts rather than helps those below the poverty line. See also,”Losing Ground” by Charles Murray, which is as relevant now as it was when it was published 30-years ago. It argued persuasively that in the wake of The Great Society experiment that government helps trap people in poverty rather than lift them out of it.

  • Robin

    One last example I thought of was Joseph. Genesis says that in the 7 years of abundance his only duty was to go around and collect all of the food produced in the land of Egypt and store it up in preparation for the famine.

    If there was enough food to last through 7 years of famine logic dictates that we was confiscating much more than 10% of the grain. For example. If the total yield in the good years was 200 units and the total yield in the bad years was 0 units, then in order to smooth consumption over 14 years he would have had to institute a 50% tax rate in the good years, and then he sold the tax revenues back to the people and confiscated their property.

    This is oppressive taxation if there ever was such a thing, but I cannot think of anywhere in scripture where God condemns this behavior. Instead he is held up as a man who through faith saved an entire nation.

    It seems that even in the OT confiscatory taxation can be viewed positively if the publicly provided goods are sufficiently large.

  • http://awaitingawhiterobe.blogspot.com MikeB

    Robin@45
    Joseph was given a prophecy about an impending famine. Not sure that it provides justification to a Biblical principle that “confiscatory taxation can be viewed positively if the publicly provided goods are sufficiently large”.

    That seems to be reading into the text a bit…

  • http://restoringsoul.blogspot.com Ann F-R

    Wow, Robin. That’s an amazing misuse of statistics if I’m reading your citation in #2 correctly. You wrote, The upper 1% earned 19.6% of total income before tax, and paid 41% of the individual federal income tax. 47% of citizens pay no Federal Income Tax whatsoever.

    You’ve mixed income earners with citizens. Now, given that all our school-aged children, unemployed, homemakers, & retirees are citizens, but none of them are income earners (except on investments, in the case of wealthy retirees), all you’ve offered are 2 largely unrelated statistical sets and juxtaposed them as if they were comparable.

    Not!

    47% of income earners are not free of taxation, AFAIK. If you have data supporting otherwise, please cite the source.

  • http://awaitingawhiterobe.blogspot.com MikeB

    For the number crunchers…

    “About 47 percent [of US households] will pay no federal income taxes at all for 2009. Either their incomes were too low, or they qualified for enough credits, deductions and exemptions to eliminate their liability. That’s according to projections by the Tax Policy Center, a Washington research organization.

    Source:http://finance.yahoo.com/news/Nearly-half-of-US-households-apf-1105567323.html?x=0

    “In 2008, the top 1 percent of tax returns paid 38.0 percent of all federal individual income taxes and earned 20.0 percent of adjusted gross income,

    During 2008, the bottom 95 percent (AGI under $159,619) paid 41.3 percent of the total collected, a larger share than the 38.0 percent paid by the top 1 percent (AGI over $380,354).”

    Source:http://www.taxfoundation.org/news/show/250.html

  • http://restoringsoul.blogspot.com Ann F-R

    Linda, when can the poor, the foreclosed-upon and the homeless expect the Year of Jubilee (Lev. 25:8-ff)? (eyebrows raised) Shall we consider whether there is historical evidence reveals if wealthy/land-owners in OT times voluntarily participated in this God-mandated practice? Ever?

    Seriously, the attempt to lift legal precepts out of the OT and apply them exactly to contemporary political & taxation realities deals inadequately with the realities of both historical situations. IMHO, we shouldn’t even make that attempt.

    Matt, #44, would you please offer data supporting your contention that the wealthy tend to invest and spend rather than hoard? Here’s another question, is the contemporary practice of investing a form of usury, particularly in the bond markets? And, again, how would today’s “investments” be distinct from hoarding? (cf. James 4:13-5:6)

  • http://awaitingawhiterobe.blogspot.com MikeB

    Another data point for taxes:

    “Taxpayers who rank in the top 50 percent of taxpayers by income pay virtually all individual income taxes. In all years since 1990, taxpayers in this group have paid over 94 percent of all individual income taxes. In 2000, 2001, and 2002, this group paid over 96 percent of the total.”

    Source: http://usgovinfo.about.com/od/incometaxandtheirs/a/whopaysmost.htm

  • http://restoringsoul.blogspot.com Ann F-R

    Mike, #48, that 47% of households, then, may also include high earning households which have sufficient deductions to avoid taxation altogether. I’ve known a few millionaires to whom tax avoidance is quite an entertaining occupation. They’d rather pay CPAs & CFAs to avoid taxes than pay taxes. Let’s not incorrectly employ statistics to support a (false) assumption by many that the 47% are necessarily part of the lower income tiers. The 47% include those who qualified for enough credits, deductions and exemptions to eliminate their liability.

  • http://awaitingawhiterobe.blogspot.com MikeB

    Ann@47 and 51

    “47% of income earners are not free of taxation, AFAIK. If you have data supporting otherwise, please cite the source.”

    I just provided the data you requested to support that half of the households/income tax returns do not pay anything. I am not trying to mislead or even “incorrectly employ statistics to support a (false) assumption”.

    So I do not assume that the 47% – 50% (see comment 50) are high/low earners – but that the the moral problem is half of households don’t contribute anything – no matter what they earn – to the upkeep of the nation. My thought is that all households should contribute at the same level (flat tax) if we are going to try to find and apply Biblical principles. See comment #40.

  • Ann F-R

    Mike, you provided a statistical source on behalf of Robin. The source you cited distinguishes differently than Robin’s info (citizens/households/earners, e.g.). Given the juxtaposition of 2 sentences in Robin’s comment #2, my comment was that the two data sets weren’t comparable. You provided a statistical source which didn’t fully address the issue. I didn’t mean to imply that you were misleading with that data; however, I have heard that data cited in a misleading way by pundits. I do note, moreover, that “households” also does not equate to earners. To give one example, “households” includes all retirees who survive on SS, or who may not have sufficient income from investments to warrant taxation. Is it a moral problem to require taxation via a flat rate on retirees, for instance? ISTM more moral to impose a VAT, rather than utilize a flat rate which penalizes the poor for being poor… (Note: analyze disposable income used for necessities such as food/shelter/medical care as a percentage of income for the lower income brackets vs. the higher, and then ascertain whether the amount left would constitute sufficient amount to pay a 10% flat tax. This is why economists/tax specialists advocate progressive taxation.)

    To Scot’s question, “are tax cuts for the wealthy moral?”, my answer would be “No” (w/qualifications), as an Anabaptist-inclined somewhat reluctant participant in the democratic process. (And there are far too many qualifications to list here.)

  • nathan

    at the end of the day, our commitments to “fairness”, and the principle that we should be able to keep what we create, etc. (capitalism) conflicts with and impedes our ability and desire to simply make the pronouncement:

    Nobody actually needs millions of dollars to live and live well.

  • Jason Lee

    My theology tells me that we should look out for the most vulnerable in our midst (e.g. children in poverty). Non-profits help, but they’re patchy. National social safety nets and preventative programs are needed. Since the rich haven’t necessarily “earned” all of their riches (a lot is due to inherited advantage, etc) a humane society redistributes the excess resources of the rich to help the vulnerable. It’d be hard to say tax cuts for the rich are immoral, but I don’t see why they’re smart, needed, or that “fairness” should be considered.

  • Richard

    In a similar line of thought to Nathan’s comment, it seems to me that it becomes a moral issue whenthe United States is actively looking for ways to reduce the deficit and that only happens one of three ways: revenue increases, spending decreases, or some combination of the two. By extending the Bush era cuts to the wealthy the government has committed itself to either disregarding the deficit or decreasing federal spending, which often affects the poor more so than the wealthy (public education and healthcare suffer, entitlement programs are decreased,federal aid to students is more essential to students from poorer households, etc). The wealthy are, by definition, not oppressed. If they were, they wouldn’t be wealthy and powerful, would they?

  • Kenton

    Income should not be taxed in a free society. Commerce (read “sales”) should be taxed. It was unconstitutional for the first 150 years of the US, and the moral thing would be to repeal the 16th amendment.

    If for no other reason, than this: why is the government supposed to know how much money I make? I can’t hire a babysitter without telling the government. That’s insane.

  • Robin

    Ann F-R,

    I apologize for writing “citizens” when I should have written “households” I wasn’t quoting directly, but trying to capture the relevant information from an article I read in the WSJ today. Mike B. and I are using the same information, I believe. I’m watching the UK game right now so I cannot look up the citation, you just have to trust that I mean to say what Mike quoted.

  • JRS

    Perhaps we should be asking, when is it moral to tax, take by force, from one person to give to another?

    When it happens at the point of a gun we call it a crime.

    Does the Bible really support taking from one person to give to another either by individuals or governments?

  • nathan

    @JRS:

    Just FYI:

    taxes are not, by definition in our system, a “taking by force”. They are part and parcel of the social contract that is our democratic republic.

    The cry of the American Revolution was not “No Taxation”. It was “No Taxation without Representation”…a critical difference that is rendered moot by our current system…and is seemingly lost on certain segments of our body politic.

  • http://LostCodex.com DRT

    Let’s test the outer bound of this. Would those in favor of giving more tax breaks to the wealthy be in favor of unlimited benefit to the wealthy? I think even the most narrow minded would agree that they would want to start to give some break to the underprivileged before the poor started to take up arms against the wealthy.

    But even before the poor took up arms my bet is that the middle classes would see the light and start to make life difficult on the wealthy way before it came to arms. But I may be too optimistic and the greed of the wealthy may be even beyond what I can comprehend, allowing it to get to the point of taking up arms against them.

    The point is, there is a limit to the inequity that the society will bear before it collapses in on itself.

    So the question becomes, what is the motivation by those that *have* to give to those who have not. The country is going to be ruled by those in control (by definition), so what limit will they oblige? It is clearly before the whole country takes up arms against them.

    If we are Christian then I think the limit is much lower than if we identify as Capitalist. How do you identify yourself? Are you in the camp of letting it go until it is no longer in the interest of the wealthy to accumulate more wealth? That is the definition of the capitalist ideal, right? Or is there another rule that we should live by?

  • Jeremy

    I’m not sure about morality…amoral, I think, but there is something to “tyranny of the majority” and the wealthy being a minority are at a distinct disadvantage if the voting base turns on them.

    That said, everything I’ve ever read said that trickle-down economics has been an utter failure and that economic booms and taxes are less tied than conservative pundits want to make it sound.

  • Cathy

    How does the word “moral” apply to any situation regarding an immoral government such as ours? Also, consider that when Congress is in session, it is one of the biggest gathering of millionaires, barring professional athletes. Jesus said, “The poor you will always have among you.” (Matt 14:7) If taking more from the wealthy would really help the poor, then it would be an obvious choice. In his paper, “Jesus the Great Economist” Charles Hansen points out that government as benefactor to the people is the least efficient solution to the problems of those who have real needs. “…the government mechanism of the welfare state delivers no Love, and, in fact, has largely replaced the direct citizen-to-citizen, neighbor-to-neighbor Respect, Care, Knowledge and Service (it’s called LOVE)that we know in our hearts is required to halt the declining values, immorality, family destruction, work and responsibility avoidance, decaying neighborhoods and other symptoms that the modern welfare state…seems to have aggravated rather than relieved.” Is further taking from the wealthy going to change this?

  • Mike Bird

    Scot, as a non-American, I simply do not understand trickle down economics. How can anyone say, with purportedly biblical warrant, that the best thing for the poor is to make the rich richer?

  • Kyle J

    @MikeB

    I don’t disagree that the federal income tax, post-Bush tax cuts, is out of whack. At the end of the day, rates needs to go up for all income segments if the deficit is going to be addressed seriously.

    But when you look at the overall tax system in this country, including payroll taxes and state/local taxes, the tax burden is actually quite evenly distributed across income groups.

    Excluding the very bottom quintile of income earners, total effective tax rates only vary between 22 and 32 percent.

    http://www.ctj.org/pdf/taxday2009.pdf

    Meanwhile, the large bulk of income growth in the country over the last three decades has gone to very high-earners.

    http://www.epi.org/economic_snapshots/entry/top_incomes_grow_while_bottom_incomes_stagnate/

    In that context, asking the wealthy to pay a little more in income taxes doesn’t seem so outrageous.

  • Cathy

    @Mike #64, though you are addressing Scot, I venture to suggest that the government allowing people to keep what is theirs is not making the rich richer. Tax cuts do not make anyone richer….they just give the government less of what is not theirs in the first place.

  • http://communityofjesus.wordpress.com/ Ted M. Gossard

    As one American, Mike (64), I agree! I just think aside from the ways it actually does, overall it demonstrably hasn’t. Another failed policy.

  • http://communityofjesus.wordpress.com/ Ted M. Gossard

    …aside from the ways it has… Exceptions to the rule.

  • http://communityofjesus.wordpress.com/ Ted M. Gossard

    But that’s my perception of it. Greed the culprit, I take it!

  • JRS

    Nathan # 60

    Do I detect a tone of condescension? I hope not and will assume good intentions.

    I do not believe I suggested no taxation.

    I asked is it moral to take money from one person and give it to another?

    So I restate the question. Does the Bible really support taking from one person to give to another either by individuals or by government?

    Until that issue is resolved, what else is there to discuss?

  • Dan Arnold

    For those who think the idea of taking from one person and redistributing it to others, how do you support the transfer of wealth that has happened in the last 30 years? The Fed did a study 5 or 6 years ago which showed that the percentage of wealth became more concentrated in fewer hands since 1980. While the percentage (a little more than 1%) may appear small, the actual amount of wealth is phenomenal. This was a wealth transfer from the poor and middle class to the top 1% of wage earners facilitated by the government. So we already have redistribution of wealth happening, but it’s being redistributed upward.

    On a tangible note, I saw how strange our tax system was this last April. I make roughly 2.5 times more money than a friend of mine who works two jobs, including an adjunct teaching position in world religions. With the way our tax system works, I pay less income taxes (but not payroll taxes) than my friend. Not less percentage-wise, less actual dollars even though I make vastly more money. There is something fundamentally immoral about a system like this.

  • http://kingwatch.co.nz/Law_Government/voluntary_taxation.htm Blessed Economist

    Arguments about the merits of Trickle Down or Tax and Socialize are pointless, because neither works. Why doesn’t the richest church in the history of the world with the best gospel ever, get on an do something about poverty.

  • http://awaitingawhiterobe.blogspot.com MikeB

    To another Mike B @ 64

    “How can anyone say, with purportedly biblical warrant, that the best thing for the poor is to make the rich richer?”

    Tax breaks (across the board) do not make the rich richer. That is a rather distorted view. The Bible does actually promote private property so what the rich person owns is actually his/hers and not the governments.

    Where is there a Biblical mandate that the government should provide the services of society? Why is it that so many think that the “best” thing is to tax more and more so that the government has control of more resources? Resources which are not all driven toward helping the poor. Cathy said it well in #63 that the government programs do not have great track records helping people get out of poverty and do not encourage character or love. Nor what is provided done with efficiency.

  • http://awaitingawhiterobe.blogspot.com MikeB

    KyleJ@65

    Thanks for the articles. However the OP was related to the Bush/federal taxes and the morality of maintaining the current tax code for “the rich”.

    “I don’t disagree that the federal income tax, post-Bush tax cuts, is out of whack. At the end of the day, rates needs to go up for all income segments if the deficit is going to be addressed seriously.”

    If it was “in whack” prior to the Bush tax cuts then are you agreeing with the OP that it is a *moral* problem to maintain the current tax code for all citizens?

    The growing income gap among earners is likely affected by many factors. Not the least of which is exploiting overseas workers, illegal immigration, (lowering wages and shipping jobs out of the country) and “the middle class” outspending their income at enormous rates. However is it the government’s *morale* responsibility to even this out through the tax code?

    The payroll tax (ie) Social Security is actually a proportional tax. Everyone pays the same percentage of income. While there are many other problems in this program, (compare the program goals/incentives at inception to today) the fact that at least it is applied evenly is good.

    As for the chart that including all other taxes (local,property,state etc) evens the tax burden, I would be curious to see other studies and views/charts since the states are so different in how they collect taxes and at what rates. Also the states vary in per-capita income as well. A person making 50,000 in NY or CA would have a far different tax burden than the same person in Alaska or TX.

  • Kyle J

    @MikeB

    I look at taxation as fundamentally a matter of funding the services the electorate has determined to be necessary and worthwhile. For the last 40 years, that’s been a pretty consistent set of services, under both Dem and GOP power: national defense, Medicare/Social Security, social safety net programs, national infrastructure spending, etc. The level of taxation doesn’t determine how big government is. The level of spending does. Cutting taxes now is simply a way of delaying paying for the services the government is providing now.

    Given that much of what government does establishes the framework for economic growth (items mentioned above, plus public safety, a judicial system, and education at the state/local level), asking the those who have earned more under the system (due to the combination of their hard work/ingenuity and favorable economic circumstances) to pay a somewhat higher rate is reasonable.

    This is where I think talking in moral terms can send the tax debate off track. Taxes don’t exist primarily to redistribute income. Taxes are the price of government. For those who want less taxes, they need to be specific about which government services they don’t want any more. For those who basically like the level of services we have, they need to say what a fair distribution of taxation is to pay for them. (For me, a progressive income tax structure, which we’ve had for almost 100 years in the U.S. is acceptable, with rates at the late-1990 levels getting us much closer to a balanced budget.) And, for many voters, the question is putting yourself firmly in one group or the other. Again, I hope we can get something like that discussion in this country over the next year or so.

  • Robin

    Couple of late additions:

    Like Kyle J said, taxes are indeed the price for a set of government services that we prefer, and that is why in the past decade the states with the largest population growth have been low tax states. 7 of the fastest growing states have no income tax whatsoever, South Dakota has the lowest tax burden in its region, and I am struggling to think of the 9th state. For those of you who read economics papers this is simply Tiebout and his “voting with your feet” premise. People have shown time and again that they are more than willing to move from a high tax/high benefit state like California (shrinking population) to a low tax/low benefit state like Texas (fastest growing population and economy).

    Also, regardless of whether we have 35% marginal tax rates, 39.6%, or 70% like we did under Carter, it is almost impossible to get tax revenue as a percentage of GDP consistently over 20% (link below). For 2009 expenditures were more than 24% of GDP and for 2010 they were more than 25% of GDP. Even a tax rate on millionaires of 70% wouldn’t have made up that gap. Regardless of tax policy we have a clear and identifiable spending problem. Current expenditures are higher, as a percentage of GDP (24.7%) than revenues have ever been (1944, 20.9% of GDP with a 94% top marginal tax rate)(links below).

    Lastly, since when do liberals care about deficits? Isn’t that kind of the hallmark of liberalism and new deal Keynesianism, that it is perfectly OK to borrow money to pay for current spending because that spending will have a multiplier effect that will ripple through the economy and cause economic growth. That was the whole reason for putting tax cuts in the stimulus and no Keynesian economist has come out and said tax cuts don’t have a large multiplier. Krugman has said they have a smaller multiplier for the rich than the poor, but even he thinks that cutting taxes for the rich has a multiplier effect on economic growth. If you are a Keynesian and believe this stuff, or if you are just a liberal that has never cared about deficits concerning entitlements like SS and Medicare, then I don’t know why you would be against the tax cuts (from an economic perspective) unless it was just a manifestation of class warfare.

    To be sure, there are lots of reasons conservatives and non-Keynesians should, theoretically, be against such tax cuts, but no clear theoretical reasons for liberals to all of a sudden abandon their Keynesianism and be budget hawks on this 1 issue.

    http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=205

    Taxes as % of GDP (Table 1.2)
    http://www.whitehouse.gov/omb/budget/Historicals/

    Historical Top Tax Rates
    http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=213

  • Robin

    Here is why I don’t favor raising taxes:

    I think it will have real, negative effects on economic growth. This might be OK if I thought that tax cuts were going to be coupled with responsible spending cuts, but there is very little chance for that. The increased tax revenue would have been spent on more new projects, more initiatives, more pork.

    Until the Federal Government shows a real committment to cutting spending, then lowering taxes won’t starve the beast, they’ll just borrow more money to pay for it, and raising taxes won’t produce a budget surplus, they’ll just spend it on more special projects.

    Our only hope for a budget surplus is that we have another economic bubble (like the Tech bubble under Clinton) in which the economy causes tax revenues to grow quickly before the politicians realize what has happened and begin spending the new money.

  • Kyle J

    @Robin

    Certainly the tech bubble was part of it (economic cycles are the largest driver of changes in the deficit). But tax increases (under both Bush Sr. and Clinton) also played a substantial role in getting the budget balanced in the 1990s. It would have pretty easy to maintain that balance over the last decade, except that all the Bush-era initiatives (tax cuts, two wars, prescription drug benefit) were financed entirely on a deficit-spending basis.

    To me, following the model that worked (tax increases + moderation in spending growth) makes a lot more sense than following the one that didn’t (insisting on tax cuts without corresponding spending cuts).

  • http://azspot.net Naum

    @Robin, #76: The empirical evidence of U.S. economic history directly refutes this assertion — the period of U.S. greatest economic growth and advancement (and creation of a large middle class) occurred when tax rates were at the highest, 1930s – 1980.

    I’d say it’s immoral to cut taxes when the government is spending more than it takes in.

    Somebody’s got to pay for the illegal, immoral invasions, the war machine…

  • Susan N.

    Jason Lee @ #55 — yes, this is my belief. Churches on the front lines serving the needy and sharing the Gospel, but the gov’t programs are still needed to address larger issues (healthcare).

    Richard @ #56 — the saddest thing about this discussion for me is hardly a mention of the massive deficit. Unless we as a society take responsibility for paying off our national debt, it will be passed on to our children. It takes money to run a country, fight two wars, have a modern infrastructure, etc. I was disappointed that Obama conceded to continue the tax cut to the wealthiest, but I believe he needed to compromise in order to get anything helpful accomplished. It worries me what kind of future my kids will inherit from this generation. Sticking them with the problems seems immoral to me.

  • http://awaitingawhiterobe.blogspot.com MikeB

    SusanN@80

    “It worries me what kind of future my kids will inherit from this generation. Sticking them with the problems seems immoral to me.”

    excellent point. though I venture we may disagree with the solution.

    KyleJ@78

    “I look at taxation as fundamentally a matter of funding the services the electorate has determined to be necessary and worthwhile.”

    While we certainly have representation, I would certainly venture that the system is still very much broken. We usually have limited choice in the representation and both parties have in the recent past been big-time spenders and have crammed in spending bills with limited to no debate or oversight. So no I don’t see it quite that way.

    “asking the those who have earned more under the system (due to the combination of their hard work/ingenuity and favorable economic circumstances) to pay a somewhat higher rate is reasonable.”

    Doesn’t something like a flat tax do that under a more Scripturally sound principle of proportionality?

    “To me, following the model that worked (tax increases + moderation in spending growth) makes a lot more sense than following the one that didn’t (insisting on tax cuts without corresponding spending cuts).”

    Wouldn’t a better plan be deeper spending cuts rather than spending growth since we have a serious debt problem. Something the Bible also has something to say about. And no raising taxes will not solve the debt problem, it will likely only increase it as recently both Bush and Obama have advocated increased spending.

    The problem is the government can not and will not control spending. It sees itself as the necessary agent of solution in all areas of life. No problem can not be solved by regulation or spending therefore it will not release control of issues like education, housing, and such and stop meddling with the state rights over these areas. The government can not and will not make hard decisions regarding making the entitlement programs more financially sound and overhauling these massive programs so that they not only solve immediate day-to-day needs but also build into the system personal responsibility and incentives to become more sufficient. The response to the debt commission ideas shows that to be the case.

  • Robin

    Naum,

    I’m not sure what you are referring to when you say “this” but I put all the data cites in my post. We had economic growth, but tax revenues as a percentage of GDP never went above 20.9%, even when the top tax rate was 94% under Roosevelt, and even when it was 70% under Carter. Spending has frequently gone above these levels, which is one reason we have lots of debt owned by China.

    Tax revenue is currently well below 20.9% of GDP, and maybe if you reinstate the Clinton tax rates on the wealthy you’ll get it back up to 17% or so (but nowhere near 20% unless you bring back the Clinton rates for everyone, and not just the wealthy. But even if you reinstate the tax rates for every income group, raise the inheritance tax to 55%, etc. You still have to deal with the FACT that revenue as a % of GDP is extremely unlikely to pass 21% and spending is over 25% of GDP.

    That means that under the rosiest taxation scenario where we are literally raising rates for everybody we could still only pay for 80% of current Federal outlays. What we are talking about on here, just raising taxes on people making over $250,000 would probably only get you to being able to pay for 70%-75% of the budget because the tax cuts for the “non-rich” were 3 times larger than the tax cuts for the rich,

    Tax cuts (or tax increases) cannot be large enough to pay for the spending problem we have right now. Raise them all you want. Our only hope for closing the budgetary gap is profound economic growth, which unfortunately noone is forecasting for the next 5-10 years.

  • Kyle J

    @MikeB

    1) “And no raising taxes will not solve the debt problem.”

    That’s a statement of ideology, not fact. Again, raising taxes did, in fact, contribute to balancing the budget under Clinton.

    The deficit = spending minus taxes. Changing either component of the second half of the equation will result in a change to the first.

    (2) I don’t believe that tithing (an act of charity) is the same thing as taxation (a collective act of purchasing government services). And again, overall taxation in this country is pretty close to proportional.

    (3) The argument seems to run “politicians won’t cut spending, so let’s cut taxes–so they’ll cut spending.” But, of course, that hasn’t happened after any of the tax cuts of the last 30 years.

    As for what the electorate wants: Republicans have been running for office on promises to cut spending for the last 30 years. If people who run for office on promises to cut spending won’t cut spending, it may say something about whether they think people would really like those spending cuts, as opposed to some corrupt process that the purported spending-cutters are somehow unable to change when they take power.

    Finally, saying “No problem can not be solved by regulation or spending” is a bit of an overstatement, no? Did government regulations have anything to do with the dramatic environmental improvements in the U.S. since the 1970s? Does public education do anything to improve the social and economic well-being of children from lower-income families?

    It’s difficult to discuss fiscal/economic matters when the baseline is an Ayn Rand/Ron Paul vision of a libertarian utopia that has never existed anywhere in human history.

  • Kyle J

    To clarify one point: I fully realize there need to be changes to federal spending policies, particularly with respect to entitlement programs. But they’ll need to be coupled with tax increases under an realistic deficit-reduction scenario.

    When I referenced spending cuts in my previous comment, I’m talking about dramatic reductions in or elimination of major social programs–which libertarians favor but conservatives actually in elected office seem to oppose.

  • nathan

    #70

    @JRS:

    Sorry if I wasn’t clear…after I posted I thought I should have made clear that I didn’t think that was what you were saying.

    Again, I think your question doesn’t really obtain in a discussion about taxes for the reasons I initially stated.

    However, since you’ve brought it to the table No. It’s not right to take from someone forcibly.

    But, again, taxes of any kind really aren’t the forcible stealing of a person’s wealth. Taxes are a basic feature of the social contract of our democratic republic. We need governance and that costs money.

    We’ve agreed to participate within the structures of our republic, therefore we’ve assented to taxes through our elected representatives. We may not like it, but all this complaining about taxes is mind-boggling to me when the truth is that for most of us our taxes have decreased. (That’s simple fact.)

    You may say you’re not problematizing taxes, BUT your question implicitly tries to frame the conversation in terms that, again, by virtue of our polity, do not really obtain.

    The question with taxes is not if it is stealing. The question is “Do they actually create a burden?”

    A 3% increase on the wealthiest isn’t actually hurting them. Especially when they control more than 80% of the wealth. (We lament this in other countries we call “developing” or “third world”, why not in our own?)

    I know it’s truly the politically incorrect thing to say, but…

    Nobody actually deserves to live with millions and millions of dollars. And nobody actually NEEDS to live with millions and millions of dollars.

    A lot of wealth is generated by a fundamentally inequitable system and so if we do want to inject questions of “stealing and/or ethics” into the mix, then we should be interrogating the basis on which such small numbers of people control so much wealth in the first place.

    Trust me, it ain’t cuz they “work harder” than the poor.

    Peace.

  • nathan

    @Kyle J:

    Well said.

    Despite the attempts to articulate the libertarian view as the essentially “christian one” by some people in the public discourse, it’s fundamentally sub-Christian in its anthropology precisely because it reduces the imago dei to an essentially economic being.

  • http://LostCodex.com DRT

    I contend that most people feel it would be ill advised for them to raise taxes on the weathy because they know the wealthy run the country and if they raise taxes on them then the wealthy will raise taxes on the poor.

    That is the only logic I can think of why people support this.

  • http://awaitingawhiterobe.blogspot.com MikeB

    KyleJ@83

    MB: “And no raising taxes will not solve the debt problem.”
    KJ: “That’s a statement of ideology, not fact. … The deficit = spending minus taxes.”

    Your equation is right, but I am not looking at this so much from an ideology point of view as much as a reaction to the fact that the federal government has not cut spending. So while I agree with this statement: “Changing either component of the second half of the equation will result in a change to the first.”, the practicality is the spending part keeps increasing so raising taxes can only go so far in solving the debt problem.

    “I don’t believe that tithing (an act of charity) is the same thing as taxation (a collective act of purchasing government services).”

    me either. what I don’t understand is why some Christians want the task of caring for the poor to be handled by the government through increased taxes. Particularly based on the poor track record of the government. And as the OP implies then make it a morale imperative on top of that.

    “it may say something about whether they think people would really like those spending cuts”

    That’s part of the problem – people in general don’t want to give up some of their existing and unsustainable benefits. Who collecting SS at age 62 is going to say sure I’ll give that up and wait 10 years to collect?

    “Finally, saying “No problem can not be solved by regulation or spending” is a bit of an overstatement, no?”

    I didn’t say that the federal government could not solve problems. Nor am I saying that it should not have a place in solving problems. If you read the whole paragraph the problem (as I see it) is that today most look to the federal government as the primary means to solving problems.

  • http://LostCodex.com DRT

    MikeB#88 – you say

    “what I don’t understand is why some Christians want the task of caring for the poor to be handled by the government through increased taxes. Particularly based on the poor track record of the government.”

    I hear this argument a lot from people. But didn’t the church pre-date the government? And the church abjectly failed? So the government had to step in? That is what happened.

  • Montjoie

    Political power flows from the barrel of a gun. Taking money from people who do not want to give it is coercion at gun point, ultimately. Doesn’t seem to me the church should be advocating taking other peoples’ money against their will.

    And DRT, “the government had to step in?” To do what? How did that “War on Poverty” turn out for you statists? Who won?

  • Kyle J

    @MikeB

    I didn’t read your concluding paragraph very carefully. I apologize for oversimplifying your statement.

    Concluding thought: I wholeheartedly agree that hard choices will be required, on both sides of the ledger. Extending tax cuts for all income groups–but particularly for those who have managed to do quite well despite the recent economic crisis–hardly represents such a hard choice IMO.

  • nathan

    RE: #90

    Not in a democratic republic. When they take away the vote is when that rhetoric holds true. Our government exists by right of the governed.

    It seems to me that the issue for some people, if they were really honest, isn’t really the “government”…it’s the social contract and the polity our constitution outlines.


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