WHAT’S MINE IS MINE, WHAT’S YOURS IS NEGOTIABLE

12/4/10

While just about the whole world knows by this time that the compromise on the “Bush era tax cuts” will be an extension of those cuts for all taxpayers for the next two or so years, the Democrats have played a very effective political game over the last few days, holding votes first on keeping tax rates where they are for those making under $250,000 while raising them for everyone else and then raising that threshold to $1,000,000. While the proposals passed the House easily, they were doomed in the Senate, where the Republicans, with the help of Democrats who are either more conservative or more frightened of their constituencies than are the true believers in their party, have enough votes to filibuster (Oh, for the days of the real filibuster, with the 30 hour speeches and the attendant mighty bladders or, failing the latter, the concealed catheters. What is called a “filibuster” today is, like many things in modern America, a mere namby-pamby faint echo of the manifestations of the nation’s distant greatness whose name they curiously continue to bear. But I digress.) any legislation not to their liking. One can hear the campaign commercials in 2012: While Hitchcockian music plays in the background, some somber fellow whom we are expected to take seriously, intones “Senator (Insert name of any Republican here) voted to increase taxes on the middle class….” while screams are heard emanating from the assemblage of the somehow put out. And, given the excerebrosity of the American voter, such stunts will probably work. So the Democrats, almost always better at politics than the Republicans, have engaged in some very good politics and, probably, some very poor economics.

The arguments surrounding extending the tax cuts are both old and silly, or at least completely ignorant of Constitutional functions and limits of government, on both sides of the aisle. The GOPers tell us that to raise taxes in the upper brackets would hurt small business people. In order to advance this argument, two statistics would be helpful. First, what percentage of those who pay taxes at the highest brackets are small business people paying business income taxes on their personal forms? Second, what percentage of small business people pay taxes at the highest bracket? That the GOP uses the small business argument as a mere talking point, never providing either of those two statistics, probably says a lot about that argument. Regardless of the statistics, though, it’s a lousy argument, as I will elucidate below.

The Democrats, on the other hand, argue that those in the upper brackets don’t “need” the money and thus should be taxed. I realize that a lot of people on the right who should know better are awfully quick to throw around the facile “Obama and the Democrats are a bunch of Commies” argument; such people should consult with those who have lived under real Communist regimes before throwing around such a specious charge. That having been written, the “ ‘Rich’ people don’t need it” argument sounds a great deal like “From each according to his ability, to each according to his need,” an utterance from a genuine Communist. But, again, I digress.

Both the GOP small business argument and the Democrat “They don’t need it” argument are silly and indicative a flawed understanding of what government can and should do. Both arguments presuppose that the government can and should decide how much of the fruits of one’s labors one should keep based on the worthiness of one’s efforts, in the case of the GOP, or one’s needs, in the case of the Dems. How can anyone with even a vague familiarity with our Constitution and/or our history legitimately argue that the government’s role is to determine how much of the money one makes one can keep? Since when is all income government’s to dispense as it sees fit?