I just can't sit around in silence any longer. I have been lurking around NS for years now, listening to everyone's opinion and generally enjoying the discourse over a variety of topics. But as we creep closer to November, and the political debates heat up, I just can't suffer in silence as I read these fallacy-ridden arguments any longer. Just as some background, I hold a degree in economics from Pomona College, which admittedly is a fairly left-leaning institution but also very reputable. I am a business consultant and am very involved in my family's small business, although I do not hold any equity at this point.
I would like to address a lot of the issues concerning this current presidential campaign, as this is what this thread was initially about, but I'd like to start with taxes as this seems to be the hot button issue at the moment. I'll start with some of the more illogical arguments first, as they don't take too much time to explain. First of all, those of you who think your taxes (or your parents') go straight into the pockets of day-drinking delinquents need to get your heads straight. First of all, social welfare programs make up a fairly small portion of our federal budget, i.e. unemployment, welfare, Medicaid, food stamps, etc. all add up to about 18%. In comparison, approximately 23% of our budget goes towards defense and other national security outlets, a number that would increase with Romney/Ryan. Also, the population of day-drinking delinquents is again another small percentage of the population receiving federal aid. Meaning that pennies, if not a percentage of a single penny, on your tax dollar MIGHT end up being used to purchase a beer. It should also be noted, that almost 50% of welfare recipients are children, which is especially so when it comes to foods stamps and Medicaid. I know this is just going to provoke people into claiming folks shouldn't start families if they can't pay for it, but that's another hasty generalization and I'm not about to judge people who simply want to carry out the one human purpose on this earth.
Secondly, yes, the rich should be taxed more and yes, that is fair. For me, this comes down to both compassion and simple macroeconomics. I care about people who are less fortunate than me, regardless of how they wound up that way (bad luck, substance abuse, victims of malicious intent). I realize this skiing community of ours is fairly well off and pretty sheltered, which is why I think a lot of you have no idea how difficult it is being poor. I could delve into all the reasons as to why this is, but you should all know that it's not as easy as "taking loans out to get an education" or "getting a job." Next time you see a homeless person on the street, genuinely try and think about what that would be like and the steps necessary to get back on your feet.
As for macroeconomics, I am flabbergasted that people still think the 'trickle-down' theory works. When the wealthy get tax breaks, they do not suddenly start purchasing more consumer goods. They are already living comfortably, the percentage of income spent on consumer goods would actually go down as their gross expenditure would remain constant. When the wealthy get tax breaks, they more often than not spend that extra income on restructuring their stockpile and increasing their investments, which don't trickle down anywhere (except to maybe tax lawyers). Therefore, increasing taxes on top income earners is most certainly an effective way of enforcing trickle down economics and improving the living standards of those less fortunate. I know THIS will provoke people into claiming top income earners would donate to charity more if they had more income, however studies and common sense show this is absolutely not true for many reasons. America has one of the 1st world's worst gini coefficients, that is absolutely inexcusable in my mind and should be fixed (cue cries of socialist pig here). I could get into the housing bubble and national debt but I'll save those arguments for later if the thread goes that direction
And lastly, for those of you squawking about small businesses being hurt by taxes you're also misled. And I say small businesses because large, multi-national corporations are doing just fine in this country, and I wouldn't mind seeing their corporate taxes increase just a bit because of it (but that's a different story). Small businesses, like well-earning individuals, do not immediately go and start spending when they receive tax breaks. That extra money goes straight into savings where it sits around and lets the economy stagnate. The best thing to do to encourage a small business to hire an employee, which is what this economy needs, is to boost spending through demand-side economics. To put it simply, giving my family business X amount in dollars due to tax breaks doesn't do anything. Putting X amount of dollars into the hands of consumers (note: consumers that would actually increase their spending as a percentage of income, not top earners) will bring them into the store and spark demand, consequently creating the need to employ more individuals. Small businesses would LOVE to make it into the $250,000+ bracket, regardless of how high the taxes are, just as individuals would.
Spark notes: There are so many other things I would love to talk about, but these were the arguments that I found particularly irking. Your tax dollars don't buy beers for lazy slobs. Trickle down economics does not work, so yes the top earners should be taxed more. Businesses do not need tax breaks, they need more demand. The segment of the population that represents the largest potential increase in demand/consumption is the lower and middle classes, not the upper class.
Thank you NS for finally tipping me over the edge, I look forward to contributing more within these forums. I'm not trying to bash anyone for their beliefs, I simply want to continue to learn about what other people have to say and maybe contribute a few ideas of my own.
