Essay on Taxes and Seeing the Privilege in Paying Them
increase taxes on creative payment to executives, capital gains, & non-wage income & cut down on tax breaks for depreciation.
I believe I posted the following Tweet in the last Lexdate, but I think it's worth posting again as intro to today's entry where I philosophize about taxes.
People can get emotional about taxes. Some people really hate them. A few people even feel real good about paying them. I probably fall in the middle with some leanings to feeling good about them. Let’s explore some of the reasons for these feelings and see if anything interesting comes.
A dichotomy comes to mind while reading The Healing Power of Doing Good: The Health and. Spiritual Benefits of Helping Others by Allan Luks with Peggy Payne: Choice vs Obligation. When it comes down to it, taxes are an obligation put onto us by the State under which we live. We have no real choice in the matter, unless we have no problem going to jail, some other penalty, or willingly leave the country. In general, people would rather choose something rather than feel obligated to do something, though exceptions may exist. Nonetheless, many likely dislike taxes because they're an obligation and have no direct choice or control in the matter.
An argument against taxes that follows from the lack of control and obligation aspect of the matter: the tax payor may not get something in return for their taxes. This case probably holds most true for adults without children or never had children, rich people who have money that won't need to go onto welfare and can pay their way through life, and other services that person doesn't see, but they have to pay taxes, anyway. Don't worry, after listing off reasons for people not liking paying taxes, I will try to argue against such reluctance.
People who receive benefits on the taxpayer dole don't deserve it, local charity should take on the responsibility for these people not the State, and/or it's too impersonal. The first one: People who don't take are of themselves are immoral, which blames the victim who had bad luck of the draw or faces prejudice, many who have no fault in their character. Maybe certain local charities can handle their local unfortunates, but many cannot or everyone in a local area might fit under the need for charitable help, so no one has the fortunes to contribute.
Some argue that charity exists to bring people closer together and strengthen the fabric of society, which science, on some level has proven that helping can help the volunteer (see The Healing Power of Doing Good) and the person in need, if provided for respectfully, might feel gratitude for the help that they've received and feel the desire to give back to society, which is great. This one might actually beg a question: How much risk is there of this one becoming an obligation for both sides, compulsory even, losing its spirit? Taking the importance of this one for granted might transition it into a state where people refuse to do it because they feel required to do it, not out of their own desire to act with altruism.
This exploration will focus mostly on American attitudes toward taxes. The American Revolutionary saying "No taxes without representation", I believe, has stayed with us and emboldens us after about 267 years. We really take it to heart, and it makes sense. It makes sense. Why should we have to pay taxes if we have no say in how they're used or if we have no say in how they affect us, if they're just redistributed from us to someone else? I am a pacficist with an exception for self defense, why should I feel comfortable with the government taking part of my paycheck to wage war? I'm against eating meat or ingesting dairy, but my tax dollars come out of my pocket then get used to subsidize ranchers. My work becomes government assets to fund activities that I despise.
To flip the coin, however, look at Shay's Rebellion, probably the most cited insurrection that inspired the end of the Articles of Confederation to be replaced with the original draft of the United States Constitution. In full disclosure, I have a soft spot for Shay's Rebellion because part of it occurred in my hometown, a middle school I attended for about 3 or 4 months was named after a militia man who marched against the rebels (I believe), the name of a road was named after one of the rebels, and the part that really clenches me, I didn't learn about it until I had moved halfway across the country, at about age 32, and needed the Internet to research it.
To sum up Shay's Rebellion: The original states of our early country had taken on A LOT of debt to fight the Revolutionary War. Each state had the responsibility to pay their own war debt. The states raised income to pay that debt through taxes, especially land tax. One characteristic of landowners is that they don't always have liquid assets to pay their taxes, especially if they inherit their land, the economy isn't moving that much, or they have a bad month, season, or year and their land doesn't produce much. The state doesn't care. It needs money. Landowners have land. The state taxes them. And arguably, the landowners have representation because owning enough property, especially property, grants them the vote. Nonetheless, they couldn't get the state off their back from taxing them because the state had to pay their debts to pay for winning their freedom from the supposed tyranny of King George III and the Parliament at the time.
These landowners said screw it and rose up in rebellion. After all, didn't the American Revolution happen for the same exact reason (at least a lot of Massachusetts towns voted for Revolution because of what they saw as unjust taxes. . .other areas of the country had their own reasons, not necessarily as just)? The rebellion was quashed.
The Federalists, however, realized that this way of doing things wouldn't keep the Union together, though. Some states had the wealth and income to pay off their debt, others don't. They had already seen and foresaw many similar insurrections would happen in the future. So after much debate, they scrapped the Articles of Confederation, wrote the Consitution, and decided that, for the war debt at least, they would pool it together on the federal level and charge taxes more equitably among the states. I can see how some might have grumbled about it, since their states paid off their debt well enough, why should they subsidize other people?
One frank argument is that if other states suffer economic ruin, the more successful states will suffer at some point (if anything, imagine an overflow of economic refugees moving between states just looking for better opportunities, definitely advantages and disadvantages, but it doesn't help for economic diversity and states could end up suffering pretty badly in the need for charity for many of these economic refugees).
I want to come back to the present by discussing an issue that Shay's Rebellion brings up: owning land. To me, amassing property and multiple properties feels like a lot of responsibility and risk. I can see that it comes with the chance of reaping a lot of reward, but it comes with a lot of work, back then and now. In my opinion, if you want to own land and reap those rewards, you better know what you're doing, plan well, adapt well, and have backup plans (whether insurance or savings) ready in case shit hits the fan. Just look at what happened to our economy after the Housing Crash and Great Recession. It was more than housing and mortgages, but A LOT of people got screwed by it. They bought into the prosperity that came with land ownership and homeownership. It was a myth that we all ate up and that the home values would just go up and up and up without any top end. As we now know, that's not possible.
I have some compassion for people who inherit a home or land and have a strong connection to it because they grew up in it, their parents owned it, and a it carried a lot of memories. Nonetheless, if they don't bring in the income to pay the taxes and maintain it, their pretty damn screwed because the state can take a chunk out of them. There's also Estate taxes. . .why should someone have to pay to inherit property that's always been in the family and they've lost that family? Can't the damn government see that it doesn't even make up for their loss? I get it. I may not have that strong of emotional connections with property, but I can get it. Feelings are strong, and they are real. We feel emotional pain and joy the same as injuries and physical pleasure. Love is real.
I've come to appreciate the fact that villages, towns, states, etc. governments tax us for material attachments to this world to deliver services for the social good (and also to pay back debt taken on to pay for those services when the government body didn't have the assets to use). Much of the time that we get taxed, it occurs because of liquid assets growing, getting liquid assets from selling property, from income because of our labor, or using liquid assets to purchase property through sale. In many ways, as long as we don't overspend and take into account taxes, we won't go into negative territory because of taxes. A portion of the liquid assets that we take in or put out are taxed, not usually more.
Yes, we "lose" value and deal with opportunity costs via gaining and using buying power, but a prudent person who puts thought into it will not go into the negative from income tax, sales tax, tariffs, etc.
Property taxes for land or homeownership enters into strange territory, I'll admit. The land can do nothing, generate no income, but you still get taxed for it. Like I said before, I can understand how owning land and a home can suck like that. It's like paying rent on top of rent. Maybe if a town just collected enough money to maintain the department that handles deeds and other things that directly secure ownership of the property to a particular person or entity, people wouldn't get so worked up about the situation. Sure, they might grumble, but they're paying to keep the records there for their ownership. If they want to start their own town do the work to maintain the validity of their ownership, which could include arming themselves and other things to secure their property in that State of Nature, that would be interesting. . .kinda like The Walking Dead without zombies, if everyone followed that lead.
Some take pride in paying taxes, especially from the good that it can do on their behalf for others. I'll aim that pride in a different angle. I agree that taxes can do a lot for the social good, which I'm in support of, including the maintenance of our currency. The value of our dollar bills come from the fact that our Federal government accepts it as payment for taxes. So arguably the presence of that dollar bill in your hand or the 1's and 0's that get passed around from our bank accounts and taken on as loans comes from us paying our taxes (and our government paying back their debt). We could go back to the gold or silver standard, but that limits the growth and malleability of society and our economy. We could also go back to bartering goods and labor and trading IOUs, which might lead to a more stable economy most of the time (but still has the risk of bubbles popping). But if no use for our goods, labor, and IOU at a particular time, it's practically like having no money. Working that way also requires a big paradigm shift. A single currency has the benefit of fungibility and that, for most people, they will more often than not have a demand for money unless their spiritually enlightened and seeking to let go of their material attachments (which isn't necessarily a bad goal).
But I think being taxed and having the ability to pay them while keeping our heads above water and even successful provides us a reason to feel good and even proud (not in a shameful full of ourselves way, but in a good, healthy way). Getting taxed represents our receiving a benefit of privilege. We are gaining power and means, or maintaining power and means. As you can see from the Tweet at the top of this entry, I don't believe tax should be exacted on someone who would go destitute, can't survive, or maintain a certain minimum quality of life if they had to pay a tax, even if they were to practice prudence and reason (because frankly practicing prudene and reason during times of poverty may actually seems like immoral, unruly, or horrible behavior. . .is stealing sustenance to actually continue living an immoral act or is it someone stuck in a State of Nature who would suffer and/or die if they did not steal).
Paying taxes and continuing to succeed feels like a point of pride to me. You're gaining privilege through a system that is maintained by the currency. The more taxes you pay without actually suffering, the better you're doing and the more you get to enjoy life. Rich, wealthy people might think it's unfair that they have to give up more a share of their property, but do you know what, the bigger numerical share means less to the rich person. It's not a toss up between survival and paying taxes, it's a toss up between more property and paying taxes. Your large amounts of property, income, and STUFF that is maintained by your taxes and, arguably staving off a State of Nature, buys you status, prestige, and other things that maintain the good things in your life. It's an accomplishment of our ancestors, today's society, your family, and you that you get to live this life.
Your taxes go to maintaining the social fabric. If you didn't pay taxes, your dollar bills and 1's and 0's would have no value. Sure, we would likely find other things to value, which could include the slavery of other people, but do you know what, that's a whole lot harder to maintain. You would have to put a lot more energy into maintaining your status and property in a State of Nature where someone bigger and badder than you (maybe with an army or even amongst your followers) could just come up to you then kill and/or take all your stuff away. So yeah, you and all your money and all your taxes are what helps keep the world sane, as long as the government and society maintain their sanity, too. And frankly, redistributing your wealth toward services, other people, children, etc. etc. does A LOT to maintaining sanity and even developing the world into a state in which more people can enjoy the benefits of economic privilege and feel secure in a world in which people aren't jealously backstabbing each other to get more and more wealth so they can have more than everyone else and lord it over them.
But hey, if you feel that invested in material attachments as the prime importance of the world and don't want to contribute to the good of other people, you can have the responsibility for contributing to the downfall of society and enjoy the hyper vigilance that you will need to exercise every moment of your life to keep it. In the end, we can all follow through on us all dieing alone or maybe building a world where we all have some sort of authentic, loving company when we pass away.
It's all our choice, we make the world we live in.
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