John Médaille of the Distributist Review has an interesting post criticizing the Fair Tax. The Fair Tax is a proposal being advocated by Mike Huckabee who is running for President. He expresses as well as I could the general deficits of the plan. In principle, the advocates claim that it taxes consumption. This is another way of expressing that it adds friction to trade. While I think there is significant benefits to adding frictional costs in some areas, I don’t think all trade is equal and some of it is quite beneficial.
In another discussion I was asked why I don’t support direct cash welfare benefits as is the case with the EITC. Since the fair tax proposals offer a universal welfare benefit, this would be as good of time as any to discuss the why. The short answer is that it is dehumanizing. A part of someone’s ordinary existence should not be dependent upon receiving a check from the government. Systemetizing this subsidization allows wealthy companies to shirk their responsibilities to pay a living wage. In fact, we end up getting into excuse making. Someone will claim that there won’t be any landscaping jobs if a living wage is required. Well, maybe there shouldn’t be any landscaping jobs if the purchaser of landscaping services is unable to purchase them without asking the rest of society to offer a de facto wage subsidy. Not to put too fine a point on it, but it is quite amazing that people will say that it is okay for a company to pay wages that won’t allow the purchase of shelter, food, medical care, and heat. These same people will turn their noses up at our history of slavery in this country when the slavery codes mandated those as minimums. We have people more concerned that if they unionize the guy next to them might get the same raise while the guy at the top is making 100 times their wages and the shareholders are still realizing 20% earnings to boot. All welfare does is attempt to justify the immoral choices of the aristocrasy. Employers get to place the burden of caring for their employees upon society, and employees are deluded into believing they lack what’s necessary in order to be a productive member of society or they think deep thoughts of fairness have gone into the pittance they receive.
As I’ve stated before, if we are going to have corporations, they might as well benefit the public. The free market crowd isn’t a big fan of that, but that is where I stand. Persuant to that, corporations need to pay their employees a living wage. If they don’t want to do that, they can form partnerships and have all the true joys of ownership. For escaping some of the joys of ownerhip, they can pay a corporate tax. This will help even the advantages they enjoy that the Ma and Pa’s don’t. For those needing more justification, consider them licensed tax collecting agents of the State. This isn’t grossly different than our present tax code. This along with a VAT for interstate and international commerce should be enough for the Feds.
Why not a VAT for everything? I don’t think the government needs to be involved in everything. This is why I’m not terribly concerned about living wage laws for partnerships or collecting the sales taxes or VATs for local transactions. I also don’t really see the value in the individual writing a check to the government. In the welfare State, it can theoretically be an issue. Our country did however survive until WWII without an income tax. While I don’t have an issue taxing income over $250,000 a year in principle, I’m not sure it is really necessary. I don’t have an issue with it, because one has difficulty calling income above that point labor. No, I don’t have it out for the rich, but I don’t stay up at night worrying about their ability to survive either.
To ensure my successful run for office, I think local and state governments should be funded by a land tax. In particular, the State should have a crude assessment per acre. For Wisconsin’s 35 million acres, that would have amounted to $314/acre, give or take last year. Some of this would be State and Federal Land that can’t tax itself, so we would be closer to $500/acre, give or take. Needless to say, a 200-acre farm of cash crops just became more expensive, so I think I might have impaired my outreach efforts to the farmers. Of course, the farmers could make that land public and rent it from the State or County. This would of course raise the assessment for everyone else, but we would have the benefit of some public property. Out west and in parts of Canada grazing rights are common, and I think it is a better model than our suburbia model. By the way for those curious, the tax wouldn’t be collected at the individual level. It would be collected by the city or township respectively. A given city may wish to consider structures in its taxing scheme. More power to them in my book. The townships would most likely just directly pass on the tax.
As for welfare itself, make it charity again. Admittedly extraordinary times call for extraordinary measures. If and when a refugee camp sets up outside my city, then yes public spending to avoid an epidemic isn’t a bad thing. And the Lord knows it is a good thing to better the public good. Build roads and parks. Even go about having a government social insurance model that allows all citizens to be able to receive good medical care. Build up a public infrastructure. Be a real community rather than just the glorified caste system as we have become.
And this ladies and gentlemen is why I will never be your elected official.
Ad-Free & Subscriber Log-In