Let me begin by saying that I believe in foreign aid. I think properly used, foreign aid can be a significant tool in our national security in addition to making the world a generally better place.
We give a significant amount to Israel each year - $3 Billion. It is the largest recipient of US government aid. That equals a little more than 1% of their entire GDP and almost 4% of the government budget. It essentially goes there with no strings attached. A group of legislators have proposed that we raise that amount to about $3.7 Billion and Israel is hoping to see it raised to between $4 & $4.5 Billion.
To put those numbers in context. The population of Israel is roughly the same as either New Jersey or Virginia. New Jersey is the state with the lowest return on its federal tax dollars in the US and actually ends up with roughly a negative $23 Million each year. That is, NJ sends $23 million more to the federal government than comes back to the state. Virgnia is the state with the highest amount of return from the federal government. It receives about $97 million more than it sends in in federal taxes. Look at those numbers for a second and realize that the state with the highest return on its federal tax dollars gets back less than 1/3 of what we sent to Israel this year... and there are obviously strings on much or most of that money. Israel, on the other hand, continues to break international law with the building of settlements. Additionally, 1 of 3 Israeli families receive some kind of government welfare including large numbers of ultra-orthodox Jews who live on state subsidies for religious study. Some studies show that 65% of ultra-orthodox men do not work but instead spend their time being paid by the government to study torah and scripture. The ultra-orthodox are also the fastest growing Jewish segment of the Israeli population.
Some economists are arguing that the Israeli economy will collapse under the weight of its welfare system. It is no wonder that they are hoping for a significant increase in our aid... On top of those who are paid to not work, Israeli citizens receive other benefits that US citizens do not. All universities are subsidized by the state and students pay only a small percentage of the actual costs. Health insurance is universal and looks to me roughly like Medicare for All. One could easily argue that we subsidize all of these benefits.
So what do I think we should do? I think that aid should be tied to real actions that reflect our values. Should we dictate to Israel how they should live? No. But neither should we subsidize their choices when they conflict with our own. Here are two examples. We refuse welfare to criminals in the US... tie our aid to the dismantling of settlements and to better treatment of the Palestinians. We hold as one of our deepest values separation of church and state... tie some aid to the removal of special perks for ultra-orthodox sects.
Showing posts with label taxes. Show all posts
Showing posts with label taxes. Show all posts
Wednesday, April 27, 2016
Tuesday, March 08, 2016
Free College?
I pay taxes to support education because I want to live in a society wherein the citizens are educated at least enough to be contributing members of society. We provide education for our children because we require at least a minimally educated population or things get very ugly very fast. So why through age 18? I would argue that education has historically been provided in the amount required for an individual to be a productive member of society. For a long time - during the agricultural age, 8th grade was enough. That meant an individual could read and do enough math to be sure they weren't getting cheated when they sold a cow at market and that they could make reasonably informed decisions at the ballot box after making judgments regarding the claims of politicians. We provided that for every child in every family and the broader society absorbed the costs. An individual family that wanted to send their child further could do so on their own dime but the minimum was provided "free." A child with an 8th grade education could become a fully functional and contributing member of society. He or she could have a family, a home, and make a contribution.
When the industrial age took hold and life became more and more technical, 8th grade was no longer enough. More complicated math was often required. The world was becoming smaller so citizens needed to be able to reason a bit more to understand international issues. One needed to read better to be able to understand manuals for complicated machinery. As a society we added 4 years to what was provided "free." It was clear that 8 grades was not enough but 12 seemed to meet the requirements. A high school diploma was enough. Again, a family that wanted to send their children to college or technical school could do so, but society both required and funded through high school. An individual with a high school diploma could make a good living, raise a family, be a part of society...
A high school diploma is no longer enough. The vast majority of jobs available to an individual with only a high school diploma could just as easily be done by a machine and it takes more training than just high school to run those machines. We also live in a world that is becoming more and more complicated and ignorant populations do not make wise decisions. Either college or technical education after high school is required for an individual to become a fully functional member of society. If we as a nation do not provide those educational requirements, we run the risk of having a larger and larger underclass without any ability or hope of ever becoming a fully functioning member of the society. That is a recipe for disaster.
So... Bernie Sander's call for "free" public education is not a pie in the sky dream. It is a requirement for a healthy society. "But it is so expensive. Where will we get the money to pay for it?" We get the money to pay for the things we think are important. When the government decided we needed to go to war in Iraq & Afghanistan, almost nobody asked how we would pay for it. When my county decided they needed a new county jail, questions of money came up but almost nobody seriously said, "let's leave the criminals on the streets." So where do we get the money? Raise taxes? Perhaps. Cut the military? Perhaps. Make it happen one way or another? Absolutely.
Now how about the folk who incurred huge debts at exorbitant interest rates in order to become fully functioning members of society - taking on costs that the broader society took on in the past? I would argue that at the very least, the government should take over the private loans and convert all student loans to 0% interest. They aren't charging that much more than that to big banks that borrow money from the government... why not free a generation of young adults from that burden, allowing them to truly become fully functioning?
Wednesday, October 03, 2012
Pulpit Freedom Sunday
Religion and politics has become a hot button topic these days.
Roman Catholic Archbishop John Meyers has said that members of his church who are pro gay marriage should not receive the Eucharist.
For the past five years a group of conservative pastors have observed what they call Pulpit Freedom Sunday. Each year there is a lot of discussion about the propriety of the day and of churches making political endorsements. It is scheduled for this Sunday.
First let me come clean. I believe in absolute freedom of religion. The State has no right to dictate what a religious group can say or believe or constrain the way that faith lives itself out unless it is a danger to the general public. I also believe in freedom from religion as a necessary corollary to absolute freedom of religion. If individuals are not able to escape the influences of faith, they cannot freely choose. Public policy is therefore never to be based on religious doctrines. Freedom of religion is clearly an important issue in the two situations raised above.
A Roman Catholic archbishop can restrict who receives the Eucharist based on his understanding of Roman Catholic teaching. If he deems that advocating gay marriage is a sin, and that sin precludes one from the Lord's table, he can do that. The Roman Catholic church is not a democracy and it is irrelevant whether the majority of members agree or not or even if the teaching has no credible basis in scripture. He is the bishop and he speaks for the church (I know that is a slight over simplification). There is a set body of doctrine and practice, set by the church, which members are obligated to hold and observe. Now, if he is misinterpreting the church's teaching, that is for those above him in the hierarchy to say, not the members, not the US government, and certainly not those outside of the Roman Catholic Church. If an individual disagrees, he or she can leave that communion.
I also agree with the founders of Pulpit Freedom Sunday that the state has no right to control anything said from the pulpit. Part of the issue of freedom of religion is precisely that, that the government has no right to dictate what a religious group can or cannot say. Indeed, for many of the early framers of freedom of religion, a significant part of the equation was the ability of the Church to judge the State. How could they do that if they were not allowed to speak on political issues? If you look at the history of political speech in churches, it was not against IRS rules until the time of LBJ. Before then, pastors often spoke on political issues and no doubt, endorsed candidates at times.
Many folk misunderstand the way the tax code impacts separation of church and state. They often believe that religious organizations receive their tax exemption because they are like other charities that receive special tax status because they provide some community good. While I would argue that religious groups do a tremendous amount of good in our society, that is not why they receive tax exempt status. They receive tax exempt status solely because they are religious groups. The Supreme Court said in 1819 that the power to tax is the power to destroy, and the State has no grounds for any type of control over any religious group... therefore no taxation.
Some see the tax exempt status as a government subsidy to religion. The argument goes that because religious organizations do not pay taxes but do receive the benefits of government services, that equals a subsidy. The argument itself is not all that strong, but even if accurate, it does not matter. The Constitution precludes the establishment of religion and as was said above, the ability to tax is the ability to destroy... thereby interfering with religious freedom.
Now, I would not dare endorse a candidate from my pulpit (even though anyone who knows me could make a pretty accurate guess who I'll be voting for). I believe that God calls each of us to weigh the questions and make a decision. I believe there are some views that are clearly mo but that reflects my theology, not everyones'. Some religious groups have very well defined beliefs and extremely narrow options for disagreement. Freedom of religion requires that they be allowed to speak their religious beliefs from their pulpits.
Two other issues that have been raised a lot lately are not so clear - payment for contraception by medical insurance paid for by Roman Catholic institutions and the issue of abortion and public funds. The Catholic institutions in question are involved in matters not quite so clearly religious in nature such as hospitals, hire individuals who are not Roman Catholic, and serve in ways that are not quite clearly religious. I think the solution given by the Obama administration is an inelegant but workable solution.
As for abortions, public funds are not eligible to be used to pay for elective abortions anyway so the question is moot. It does raise a sticky point for me. What about taxes that are used to pay for things clearly in violation of a group's religious principles? If public funds were used to pay for elective abortions, should Roman Catholics or members of some evangelical groups be allowed to withhold a portion of their taxes because the funds are being used in ways that conflict with their faith? How about tax dollars that fund the military or capital punishment, both of which have been forbidden in Anabaptist doctrine for centuries? Should Anabaptists be allowed to withhold the percentage of their taxes that go to fund the military?
Roman Catholic Archbishop John Meyers has said that members of his church who are pro gay marriage should not receive the Eucharist.
For the past five years a group of conservative pastors have observed what they call Pulpit Freedom Sunday. Each year there is a lot of discussion about the propriety of the day and of churches making political endorsements. It is scheduled for this Sunday.
First let me come clean. I believe in absolute freedom of religion. The State has no right to dictate what a religious group can say or believe or constrain the way that faith lives itself out unless it is a danger to the general public. I also believe in freedom from religion as a necessary corollary to absolute freedom of religion. If individuals are not able to escape the influences of faith, they cannot freely choose. Public policy is therefore never to be based on religious doctrines. Freedom of religion is clearly an important issue in the two situations raised above.
A Roman Catholic archbishop can restrict who receives the Eucharist based on his understanding of Roman Catholic teaching. If he deems that advocating gay marriage is a sin, and that sin precludes one from the Lord's table, he can do that. The Roman Catholic church is not a democracy and it is irrelevant whether the majority of members agree or not or even if the teaching has no credible basis in scripture. He is the bishop and he speaks for the church (I know that is a slight over simplification). There is a set body of doctrine and practice, set by the church, which members are obligated to hold and observe. Now, if he is misinterpreting the church's teaching, that is for those above him in the hierarchy to say, not the members, not the US government, and certainly not those outside of the Roman Catholic Church. If an individual disagrees, he or she can leave that communion.
I also agree with the founders of Pulpit Freedom Sunday that the state has no right to control anything said from the pulpit. Part of the issue of freedom of religion is precisely that, that the government has no right to dictate what a religious group can or cannot say. Indeed, for many of the early framers of freedom of religion, a significant part of the equation was the ability of the Church to judge the State. How could they do that if they were not allowed to speak on political issues? If you look at the history of political speech in churches, it was not against IRS rules until the time of LBJ. Before then, pastors often spoke on political issues and no doubt, endorsed candidates at times.
Many folk misunderstand the way the tax code impacts separation of church and state. They often believe that religious organizations receive their tax exemption because they are like other charities that receive special tax status because they provide some community good. While I would argue that religious groups do a tremendous amount of good in our society, that is not why they receive tax exempt status. They receive tax exempt status solely because they are religious groups. The Supreme Court said in 1819 that the power to tax is the power to destroy, and the State has no grounds for any type of control over any religious group... therefore no taxation.
Some see the tax exempt status as a government subsidy to religion. The argument goes that because religious organizations do not pay taxes but do receive the benefits of government services, that equals a subsidy. The argument itself is not all that strong, but even if accurate, it does not matter. The Constitution precludes the establishment of religion and as was said above, the ability to tax is the ability to destroy... thereby interfering with religious freedom.
Now, I would not dare endorse a candidate from my pulpit (even though anyone who knows me could make a pretty accurate guess who I'll be voting for). I believe that God calls each of us to weigh the questions and make a decision. I believe there are some views that are clearly mo but that reflects my theology, not everyones'. Some religious groups have very well defined beliefs and extremely narrow options for disagreement. Freedom of religion requires that they be allowed to speak their religious beliefs from their pulpits.
Two other issues that have been raised a lot lately are not so clear - payment for contraception by medical insurance paid for by Roman Catholic institutions and the issue of abortion and public funds. The Catholic institutions in question are involved in matters not quite so clearly religious in nature such as hospitals, hire individuals who are not Roman Catholic, and serve in ways that are not quite clearly religious. I think the solution given by the Obama administration is an inelegant but workable solution.
As for abortions, public funds are not eligible to be used to pay for elective abortions anyway so the question is moot. It does raise a sticky point for me. What about taxes that are used to pay for things clearly in violation of a group's religious principles? If public funds were used to pay for elective abortions, should Roman Catholics or members of some evangelical groups be allowed to withhold a portion of their taxes because the funds are being used in ways that conflict with their faith? How about tax dollars that fund the military or capital punishment, both of which have been forbidden in Anabaptist doctrine for centuries? Should Anabaptists be allowed to withhold the percentage of their taxes that go to fund the military?
Tuesday, February 22, 2011
These Cuts
I've been chomping at the bit here for weeks as I listen to politicians talk about cuts that need to be made in government programs and that all of us will need to share the pain. They're lying. And it is immoral.
Here's where are the cuts they're discussing - education, food safety, children's programs, programs to help the poor, international food aid, and the list continues in a similar vein. Most of the budget items are relatively small but they are symbolic. To the degree that a budget is a moral document that speaks to a nation's real priorities, these discussions clearly tell us that the most vulnerable in our society are on their own. These cuts won't fix any perceived problems but the mean spiritedness and short-sightedness of the proposed cuts really is amazing to me. Imagine the future if our educational system, already lagging behind much of the developed world in important ways, is defunded and pushed further down the list. Imagine the future in our cities if the poor safety nets we currently have are removed. As a further insult, I did see a report today that while discussion these small cuts, funding for one will continue - the Army will continue to purchase ad space on a NASCAR car to the tune of $7 million a year.
Which leads us to the big areas... First is the military, which depending on how you count it is somewhere between 1/3 and 1/2 of the entire government budget as we care for vets, support bases in over 150 different countries, and prosecute two wars that are rapidly approaching the longest wars we have ever engaged in. There is almost no discussion about the efficacy of the current military or the necessity of maintaining it as it is. Do those bases in 150 countries really contribute to our security? Or are there other ways to accomplish this? After spending nearly $1 trillion in Iraq and Afghanistan, are we closer to lessening the threat of terror? And even if we are, might there have been better ways that would have cost less and caused less suffering? As long as military power is an unquestioned value for our country, we will never even investigate the possibilities.
Second is Social Security, the retirement income program. Discussions of cutting the two latter programs are taking place. Unfortunately, they haven't been honest. We hear that Social Security will be broke in X years... as the society ages and there are fewer workers paying in and more taking out of the system. While that piece is clearly true, the original intent was that the funds paid into Social Security were envisioned as being in a "lock box" as a trust fund, held for the time when they ould be needed. Whether that was ever a realistic plan or not is debatable, but beginning with Reagan, the fund was used to pay for other government programs, essentially moving it from a retirement investment program to just another tax used to fund the government.
Any changes made to Social Security will have far reaching implications for our society as it has become the primary income for many elderly folk, the very folk who built this nation. And many who are nearing retirement have planned their lives with that program as an essential part of their future. There are ways to make the program more viable. The tax is capped at a certain income level. If the funds were only used to cover the costs of Social Security, this might make sense but as they are used to fund other government programs, they become an incredible regressive tax. So raise the cap or remove it entirely. There is talk of raising the retirement age as people live longer. While this discussion has merit, it must also be noted that different slices of the population have very different life expectancies and some kinds of work simply cannot be extended. While a 70 year old may do fine behind a desk at a computer screen, climbing onto a roof to do manual labor is a very different issue. And finally there are those who look at the statistics and see the program as being viable, as it currently is, for a very long time.
Third is Medicare, the medical program for the elderly and disabled. Frankly, I don't know enough about Medicare to be ignorant enough to make stupid comments. I do know that it, as with Social Security, is a critical part of the system many people rely upon and that the problems in our heath care delivery system are systemic.
Fourth comes the other side of the equation - taxes. Our highest marginal rates are the lowest they've been for over 50 years. Surely it tells us something that as the tax rates went down, the deficit went up. The discussion has been framed by the right wing that taxes are always evil and should never be raised. While my bank account certainly appreciates that argument, my heart finds it terribly lacking. It takes money to provide essential services. In my mind, the role of government is to provide those essential services, especially the ones that cannot or will not be provided by private enterprise. To the degree that an individual receives the benefits of living in this society, that individual is responsible to pay back. That means taxes. It is clear that since the Reagan presidency, income has been redistributed upward (see the chart to the right which goes through '07, the trend has increased since then). The wealthiest 1% have by far received the most benefits of living in this society. They, and the rest of us, should pay our fair share to support this society.
OK, now for the theological part... it is simple. The scriptures again and again show God's expectations that a society must care for the poorest and most vulnerable of its citizens. Sojourners Magazine is distributing What Would Jesus Cut bracelets... surely he would not cut the programs upon which the poor depend.
Here's where are the cuts they're discussing - education, food safety, children's programs, programs to help the poor, international food aid, and the list continues in a similar vein. Most of the budget items are relatively small but they are symbolic. To the degree that a budget is a moral document that speaks to a nation's real priorities, these discussions clearly tell us that the most vulnerable in our society are on their own. These cuts won't fix any perceived problems but the mean spiritedness and short-sightedness of the proposed cuts really is amazing to me. Imagine the future if our educational system, already lagging behind much of the developed world in important ways, is defunded and pushed further down the list. Imagine the future in our cities if the poor safety nets we currently have are removed. As a further insult, I did see a report today that while discussion these small cuts, funding for one will continue - the Army will continue to purchase ad space on a NASCAR car to the tune of $7 million a year.
Which leads us to the big areas... First is the military, which depending on how you count it is somewhere between 1/3 and 1/2 of the entire government budget as we care for vets, support bases in over 150 different countries, and prosecute two wars that are rapidly approaching the longest wars we have ever engaged in. There is almost no discussion about the efficacy of the current military or the necessity of maintaining it as it is. Do those bases in 150 countries really contribute to our security? Or are there other ways to accomplish this? After spending nearly $1 trillion in Iraq and Afghanistan, are we closer to lessening the threat of terror? And even if we are, might there have been better ways that would have cost less and caused less suffering? As long as military power is an unquestioned value for our country, we will never even investigate the possibilities.
Second is Social Security, the retirement income program. Discussions of cutting the two latter programs are taking place. Unfortunately, they haven't been honest. We hear that Social Security will be broke in X years... as the society ages and there are fewer workers paying in and more taking out of the system. While that piece is clearly true, the original intent was that the funds paid into Social Security were envisioned as being in a "lock box" as a trust fund, held for the time when they ould be needed. Whether that was ever a realistic plan or not is debatable, but beginning with Reagan, the fund was used to pay for other government programs, essentially moving it from a retirement investment program to just another tax used to fund the government.
Any changes made to Social Security will have far reaching implications for our society as it has become the primary income for many elderly folk, the very folk who built this nation. And many who are nearing retirement have planned their lives with that program as an essential part of their future. There are ways to make the program more viable. The tax is capped at a certain income level. If the funds were only used to cover the costs of Social Security, this might make sense but as they are used to fund other government programs, they become an incredible regressive tax. So raise the cap or remove it entirely. There is talk of raising the retirement age as people live longer. While this discussion has merit, it must also be noted that different slices of the population have very different life expectancies and some kinds of work simply cannot be extended. While a 70 year old may do fine behind a desk at a computer screen, climbing onto a roof to do manual labor is a very different issue. And finally there are those who look at the statistics and see the program as being viable, as it currently is, for a very long time.
Third is Medicare, the medical program for the elderly and disabled. Frankly, I don't know enough about Medicare to be ignorant enough to make stupid comments. I do know that it, as with Social Security, is a critical part of the system many people rely upon and that the problems in our heath care delivery system are systemic.
Fourth comes the other side of the equation - taxes. Our highest marginal rates are the lowest they've been for over 50 years. Surely it tells us something that as the tax rates went down, the deficit went up. The discussion has been framed by the right wing that taxes are always evil and should never be raised. While my bank account certainly appreciates that argument, my heart finds it terribly lacking. It takes money to provide essential services. In my mind, the role of government is to provide those essential services, especially the ones that cannot or will not be provided by private enterprise. To the degree that an individual receives the benefits of living in this society, that individual is responsible to pay back. That means taxes. It is clear that since the Reagan presidency, income has been redistributed upward (see the chart to the right which goes through '07, the trend has increased since then). The wealthiest 1% have by far received the most benefits of living in this society. They, and the rest of us, should pay our fair share to support this society.
OK, now for the theological part... it is simple. The scriptures again and again show God's expectations that a society must care for the poorest and most vulnerable of its citizens. Sojourners Magazine is distributing What Would Jesus Cut bracelets... surely he would not cut the programs upon which the poor depend.
Thursday, December 23, 2010
Sin vs. human need
I used to participate in a Christian bulletin board that was populated mostly by fairly right wing folk who tended to be close to libertarian about the cold sins and very authoritarian regarding hot ones. They thought the government should not be involved in educating children or restricting business activities and certainly shouldn't be taking taxes from them but it was the governments business to restrict with whom or how you had sex. Sin was a big word for them but it only had to do with individual behavior, never corporate or systemic issues.
Whenever the discussion of entitlement programs came up, invariably someone would argue that the government should not be forcing them to help others... that indeed, were it not for the onerous tax system, they would take care of those in need. Now, these are folk who have more than a healthy respect for the fallen nature of humanity but they seem to forget their own theology when helping those in need comes up. Suddenly the better nature of human beings comes into play and we can count on good Christian people to do what is necessary to take care of those in need, providing food, shelter, education, etc.
Sin is not as important a word in my theological vocabulary as it is for them. Indeed, I rarely use the term. In this instance I would be more likely to use the terms selfishness, greed, and lack of a sense of community responsibility. I have no expectation that good Christian folk either could or would meet the needs of those in their communities if suddenly the government programs disappeared. For those of us who live in our comfortable suburban settings, it is all too easy to ignore the needs of those across the tracks. For those of us serving the needy, we know the needs are overwhelming. For those of us struggling to keep our heads above water, our children fed, the heat on... our needs are too immediate to have resources to help others.
Yes, I have seen and experienced the sacrificial love of many good Christian (and non-Christian) folk. As government funding for programs for the needy has shrunk, I have seen many good people work and give to pick up the slack. I do not believe that generosity is strong enough to overcome human greed or selfishness. I do not believe that enough good folk are open to the needs more than a few blocks away in a sustained way to meet those needs. I do not believe that without government intervention that there would be adequate resources to make a difference. The power of human sin is just too great. And I am always surprised that my brothers (they are all men) on that forum think otherwise.
Whenever the discussion of entitlement programs came up, invariably someone would argue that the government should not be forcing them to help others... that indeed, were it not for the onerous tax system, they would take care of those in need. Now, these are folk who have more than a healthy respect for the fallen nature of humanity but they seem to forget their own theology when helping those in need comes up. Suddenly the better nature of human beings comes into play and we can count on good Christian people to do what is necessary to take care of those in need, providing food, shelter, education, etc.
Sin is not as important a word in my theological vocabulary as it is for them. Indeed, I rarely use the term. In this instance I would be more likely to use the terms selfishness, greed, and lack of a sense of community responsibility. I have no expectation that good Christian folk either could or would meet the needs of those in their communities if suddenly the government programs disappeared. For those of us who live in our comfortable suburban settings, it is all too easy to ignore the needs of those across the tracks. For those of us serving the needy, we know the needs are overwhelming. For those of us struggling to keep our heads above water, our children fed, the heat on... our needs are too immediate to have resources to help others.
Yes, I have seen and experienced the sacrificial love of many good Christian (and non-Christian) folk. As government funding for programs for the needy has shrunk, I have seen many good people work and give to pick up the slack. I do not believe that generosity is strong enough to overcome human greed or selfishness. I do not believe that enough good folk are open to the needs more than a few blocks away in a sustained way to meet those needs. I do not believe that without government intervention that there would be adequate resources to make a difference. The power of human sin is just too great. And I am always surprised that my brothers (they are all men) on that forum think otherwise.
Wednesday, December 22, 2010
George Ought to Help
This is a typical argument of those who are against government programs that help the needy. It feels right and it seems to make sense. After all, isn't it my money that I worked hard for? And if it is, shouldn't I be able to decide what I do with it and help others only when and if that is what I decide to do?
Unfortunately, the argument is incomplete. It implies that one earns what they earn entirely on their own... that the accumulation of wealth is based solely on the talents and work of the individual. Let's add some other variables to the argument.
Let's say that Otis is blessed with incredible genetics. He has an off the chart IQ. He lives in a place where there are no public schools and dad dies in a mining accident when he is 7. At that point, in a country with no safety nets, Otis must go to work in the mines to help support the family. That his IQ is 40 points higher than that of the guy who owns the mine is irrelevant. The owner gets the profits and he dies of black lung disease at a young age.
How about Fred... he invents a new doohickey. He is pretty sure that he can come up with capital to put together a manufacturing facility to make the doohickeys but the roads and the railroads have fallen apart do to lack of government investment and he cannot get the doohickeys to market. The company fails.
Jack got a hold of one of the doohickeys and was mighty impressed. Off he goes to some other developing country and copies it, with much cheaper labor and lower quality materials. He makes a killing.
How bout Marianne... She worked hard all of her life. The company she worked for made tons of money for the owners and stock holders. She was proud of her contribution. She made a reasonable salary... but not enough to invest any significant amount for the future. She retired and was doing OK... then she got sick. She didn't have health insurance - too old and her health was poor so the cost was prohibitive. The children of the owners, who just inherited their wealth, lived in ease in gated mansions, while she made choices between heat, food, and the medicines she needed.
And James... grew up in a very poor neighborhood in a decaying city. The schools spent more energy on discipline than teaching. He didn't know anyone with two parents in the household. Half of the men he knew were either in jail or recently released. Few had legitimate jobs. When he began to skip school in 7th grade and sell drugs on the corner, nobody was surprised. His brother Bob tried to learn in school but it was difficult. He spent as much time watching his back as studying. When he graduated, he was able to get into a local college but he was so far behind the other students, he couldn't catch up and flunked out.
Steve comes from a middle class family. He went through a good school system, paid for with government funds and got a job working for a good company. They rely on a workforce that is well educated provided via the public schools. It is not possible for their employees to live with walking distance of their offices and factories so they rely on a good system of roads for people to travel to work. The monetary system is relatively stable so they can make plans for months or years in advance. They have good police and fire services to keep their capital safe. Steve's bosses are smart enough to know that the business depends on the input of all of the workers at each level and that without the infrastructure the government provides, they could make no profit at all.
And finally there is George. He is likable, smart enough, and able to keep up without working too hard. Indeed, he is a "C" student and spends a lot of time partying. He lives in the best neighborhood and is going to a top rated school. When he graduate, he gets into an Ivy League school, not because of his grades or even sports, but because of his last name. He goes to school with the sons and daughters of other powerful people and when they all graduate, they all move into positions of power and wealth.
All of that is to say that the system is not fair. Nobody makes it or fails entirely on their own. I would argue that those who benefit most from the system - like George and to a lesser but still significant extent Steve - should pay the most to maintain the system. I would even argue that the system requires some to be outside of it. Ask any Chamber of Commerce how they would feel about total employment and they will quickly tell you that someone has to be out of a job or the system would fail.
Bottom line when someone tells you that the government is stealing money they made from them, tell them to go and make that money without any of the supports that come from the government.
In a day or two I'll address another piece of the puzzle... Human generosity vs. human sin. Then, I'll get to who is better at providing for basic needs, government or for profit business.
Wednesday, December 08, 2010
taxes
Back in seminary we were given the option to opt out of Social Security on religious grounds. The requirement was a religious objection for clergy to receive government aid. As you can guess, a few classmates did opt out on anything but religious grounds. Even then (mid 1970's) there was discussion that Social Security would not be there when we began to retire. These classmates felt that they would do better by contributing the same amount to investments managing those resources on their own. I have no idea whether or how they did. My guess is that at least some of them made no additional investments and will be in a real mess when they come to retirement as they will not be eligible to receive Social Security or Medicare. Others may have been disciplined about investing and have done quite well. We'll see how it plays out for them.
I remember the discussions very clearly. I remember arguing that beyond the question of whether or not it is moral to claim a religious exemption when one is really thinking only about the economics of the situation, there is the question of one's responsibility to the common good. I argued that it didn't matter whether or not SS would be there when I retired, it was my responsibility to pay in to support those who had given their lives building the society whose benefits I enjoyed. I still feel that way even though my quarterly payments of self-employment tax (the equivalent of the payroll tax) do hurt and the fact that I am more than frustrated by the most regressive tax in our system.
Those who benefit from the structures of the society should pay to support that system and those who benefit the most should pay proportionately more. I am not only willing to pay my part... I am morally obligated to do so and the size of my part is based on the benefits I receive and have received from the system.
This chart is a very important one for thinking about taxes... and about our current situation
A few observations -
I would argue that the wealthy and the corporations that do business in the United States receive the most benefits from the system and should proportionately pay more to sustain that system.
Taxes are the lowest percentage of GDP in 60 years... No wonder we're having a budget crisis.
Corporate taxes - in a time of HUGE profits to corporations - are the lowest they have been on the chart. We have all heard of huge corporations like Exxon in 2009 reporting a tax benefit of 1.1 million on 45.2 billion in profits. The GAO reported in '08 that from '98-'05, 2/3rds of US corporations paid no income tax.
Employment taxes - Social Security, Medicare, etc - are probably the largest percentage of the chart... and are the most regressive tax in our system, effecting the poor and middle class while not being levied on higher incomes.
Estate and gift taxes, the closest things we had (and I did say had) to a wealth tax, were never large but they did contribute to the fiscal pie, have shrunk to zero.
Clearly, this situation is not sustainable. The question is what should be done. The government does things that are necessary to have a civil society and those things cost money. They must be paid for and the only way to do that is via taxes. Somebody has to pay taxes and the lion's share are now being borne by workers through the payroll tax. In this situation, the Republicans and a few Democrats are arguing that we must extend tax cuts for the wealthiest 2% while cutting safety nets, social programs, and other expenditures that contribute to a civil society. This is exactly the wrong answer. Taxes should be raised on those who benefit the most.
The argument goes that raising taxes on the wealthy will cause them to invest less, resulting in fewer jobs, etc. This logic fails when you think about it. If money is invested, that removes it from the taxable income so logically, a higher tax rate encourages rather than discourages investment. Why give the money to the government when you can use it to add capital to a business and thereby avoid paying the taxes?
I remember the discussions very clearly. I remember arguing that beyond the question of whether or not it is moral to claim a religious exemption when one is really thinking only about the economics of the situation, there is the question of one's responsibility to the common good. I argued that it didn't matter whether or not SS would be there when I retired, it was my responsibility to pay in to support those who had given their lives building the society whose benefits I enjoyed. I still feel that way even though my quarterly payments of self-employment tax (the equivalent of the payroll tax) do hurt and the fact that I am more than frustrated by the most regressive tax in our system.
Those who benefit from the structures of the society should pay to support that system and those who benefit the most should pay proportionately more. I am not only willing to pay my part... I am morally obligated to do so and the size of my part is based on the benefits I receive and have received from the system.
This chart is a very important one for thinking about taxes... and about our current situation
A few observations -
I would argue that the wealthy and the corporations that do business in the United States receive the most benefits from the system and should proportionately pay more to sustain that system.
Taxes are the lowest percentage of GDP in 60 years... No wonder we're having a budget crisis.
Corporate taxes - in a time of HUGE profits to corporations - are the lowest they have been on the chart. We have all heard of huge corporations like Exxon in 2009 reporting a tax benefit of 1.1 million on 45.2 billion in profits. The GAO reported in '08 that from '98-'05, 2/3rds of US corporations paid no income tax.
Employment taxes - Social Security, Medicare, etc - are probably the largest percentage of the chart... and are the most regressive tax in our system, effecting the poor and middle class while not being levied on higher incomes.
Estate and gift taxes, the closest things we had (and I did say had) to a wealth tax, were never large but they did contribute to the fiscal pie, have shrunk to zero.
Clearly, this situation is not sustainable. The question is what should be done. The government does things that are necessary to have a civil society and those things cost money. They must be paid for and the only way to do that is via taxes. Somebody has to pay taxes and the lion's share are now being borne by workers through the payroll tax. In this situation, the Republicans and a few Democrats are arguing that we must extend tax cuts for the wealthiest 2% while cutting safety nets, social programs, and other expenditures that contribute to a civil society. This is exactly the wrong answer. Taxes should be raised on those who benefit the most.
The argument goes that raising taxes on the wealthy will cause them to invest less, resulting in fewer jobs, etc. This logic fails when you think about it. If money is invested, that removes it from the taxable income so logically, a higher tax rate encourages rather than discourages investment. Why give the money to the government when you can use it to add capital to a business and thereby avoid paying the taxes?
Thursday, April 15, 2010
Tax Day
I mailed off all of my tax forms today and like most folk, have mixed feelings at best. We do have a refund... but I also have to make quarterly payments so one hand receives a check while the other writes one. All of it has been more immediate this year with all of the talk going on regarding the federal deficit and the impact it will have on future taxes.
I've been hearing commentators over the last few days say that with the huge deficit and the new health care bill, we will need to raise taxes or cut entitlement programs or both. As a general rule, I believe we should pay as we go. Yes there are some things for which borrowing is a logical plan, but generally, we should pay for the benefits we receive. And if you can't afford a Mercedes, drive a Kia. But here's the problem... we're being told to drive a Kia while nobody is questioning whether or not we really need a 14,000 square foot house with a pool and a tennis court. Huh? Let move away from the metaphor. The largest area of expense in the Federal budget is military spending. Now, the government figures say military spending is 20%, but that does not include costs for past military, interest on the debt incurred by military expenditures, or military costs that fall under other budget categories. The War Resisters League places the percentage of military spending at 54% with 36% going to the current military. In either case or somewhere in between, military spending is a huge piece of the pie. It needs to be a part of the discussion.
A budget is a reflection of values. Where your heart is... there is your money. The US spends more on the military than the next 15 nations combined, accounting for 47 percent of the world’s total military spending. Of the next 15 countries, at least 12 are considered allies of the U.S. So what does this massive spending say about us? Do we need to maintain military bases all around the world? Does that even make us safer? Or are the better ways to spend our money?
I don't mind paying more taxes. I benefit from living in the country in ways I cannot begin to express. It is my responsibility to contribute both to current needs and to the future. Even though I am a pacifist, I won't even complain about a reasonable amount going to the military. I do mind 1/2 of my taxes going to empirism. So let's talk seriously about the budget, about deficits, about the need to both cut spending and to raise taxes, but lets keep military spending on the table and realize that without cutting those expenditures, other changes will be inadequate to solve the problem without causing incredible hardship to our population. Imagine how many seniors would live in poverty if we drastically cut social security. Imagine what would happen to health care for seniors if we did away with medicare. We already have school districts talking about cutting a day from the school week to cut costs... imagine.
One of the primary pieces contributing to the disintegration of the Soviet Union was unsustainable military spending. Infrastructure suffered. Social programs suffered. Education and health care suffered while they continued to spend on the military until everything collapsed.
I've been hearing commentators over the last few days say that with the huge deficit and the new health care bill, we will need to raise taxes or cut entitlement programs or both. As a general rule, I believe we should pay as we go. Yes there are some things for which borrowing is a logical plan, but generally, we should pay for the benefits we receive. And if you can't afford a Mercedes, drive a Kia. But here's the problem... we're being told to drive a Kia while nobody is questioning whether or not we really need a 14,000 square foot house with a pool and a tennis court. Huh? Let move away from the metaphor. The largest area of expense in the Federal budget is military spending. Now, the government figures say military spending is 20%, but that does not include costs for past military, interest on the debt incurred by military expenditures, or military costs that fall under other budget categories. The War Resisters League places the percentage of military spending at 54% with 36% going to the current military. In either case or somewhere in between, military spending is a huge piece of the pie. It needs to be a part of the discussion.
A budget is a reflection of values. Where your heart is... there is your money. The US spends more on the military than the next 15 nations combined, accounting for 47 percent of the world’s total military spending. Of the next 15 countries, at least 12 are considered allies of the U.S. So what does this massive spending say about us? Do we need to maintain military bases all around the world? Does that even make us safer? Or are the better ways to spend our money?
I don't mind paying more taxes. I benefit from living in the country in ways I cannot begin to express. It is my responsibility to contribute both to current needs and to the future. Even though I am a pacifist, I won't even complain about a reasonable amount going to the military. I do mind 1/2 of my taxes going to empirism. So let's talk seriously about the budget, about deficits, about the need to both cut spending and to raise taxes, but lets keep military spending on the table and realize that without cutting those expenditures, other changes will be inadequate to solve the problem without causing incredible hardship to our population. Imagine how many seniors would live in poverty if we drastically cut social security. Imagine what would happen to health care for seniors if we did away with medicare. We already have school districts talking about cutting a day from the school week to cut costs... imagine.
One of the primary pieces contributing to the disintegration of the Soviet Union was unsustainable military spending. Infrastructure suffered. Social programs suffered. Education and health care suffered while they continued to spend on the military until everything collapsed.
Wednesday, February 24, 2010
You Get What You Pay for
Remember that little piece of wisdom? And we believe it don't we? Nobody expects to get a good reliable car for $1000. Nobody expects a $5 pair of shoes will last more than a few days. A cheap tool will be made of inferior materials and won't do the job. You can't get a good guitar for $150. The list goes on. You get what you pay for. Now, I know there are exceptions, but they are rare. In any given situation, you can count on that little aphorism being true.
Why then do we expect anything different when it comes to government? We have this crazy (and I mean that term) movement called The Tea Party that wants to cut taxes and cut government spending... screw the common good. They aren't asking what will happen to roads, to schools, to the elderly, to children, to the poor, to those who for whatever reason live on the margins of life. Maybe they don't care. They say people should be responsible for themselves and they should, but we live in a society where all of us depend upon the commons just to stay alive. Unfortunately, the benefits of the commons are not equally distributed. Those of us who are doing well, in large degree do well because of an infrastructure that has been provided for us by others. They say that government is inept. To some degree, that is true, but to the degree that it is true, it is because it has been the agenda of many in the Republican Party to make it inept and weak so they could "drown it in the bathtub." They say we should trust the free market. Indeed, our market has produced the most affluent society ever to exist, but when allowed to run free it has also shown that it has no compassion and no commitment to anything beyond the bottom line. They say they don't trust government bureaucrats but forget that at least they are supposed to have the public interest at heart. Corporate bean counters often have a very different fiduciary responsibility. Public interest and common good are irrelevant and may be in conflict with their shareholders' interests and those interests always come first. And they say that those who are most productive should be able to keep all they have while the least should fend for themselves. I would argue that those who are most productive owe that in significant measure to the schools, connections, opportunities that the greater society has afforded them and that they owe those taxes to the society that makes their wealth possible.
You get what you pay for... there are no shortcuts when it comes to building a civil society with opportunity and possibility for all of its citizens.
Why then do we expect anything different when it comes to government? We have this crazy (and I mean that term) movement called The Tea Party that wants to cut taxes and cut government spending... screw the common good. They aren't asking what will happen to roads, to schools, to the elderly, to children, to the poor, to those who for whatever reason live on the margins of life. Maybe they don't care. They say people should be responsible for themselves and they should, but we live in a society where all of us depend upon the commons just to stay alive. Unfortunately, the benefits of the commons are not equally distributed. Those of us who are doing well, in large degree do well because of an infrastructure that has been provided for us by others. They say that government is inept. To some degree, that is true, but to the degree that it is true, it is because it has been the agenda of many in the Republican Party to make it inept and weak so they could "drown it in the bathtub." They say we should trust the free market. Indeed, our market has produced the most affluent society ever to exist, but when allowed to run free it has also shown that it has no compassion and no commitment to anything beyond the bottom line. They say they don't trust government bureaucrats but forget that at least they are supposed to have the public interest at heart. Corporate bean counters often have a very different fiduciary responsibility. Public interest and common good are irrelevant and may be in conflict with their shareholders' interests and those interests always come first. And they say that those who are most productive should be able to keep all they have while the least should fend for themselves. I would argue that those who are most productive owe that in significant measure to the schools, connections, opportunities that the greater society has afforded them and that they owe those taxes to the society that makes their wealth possible.
You get what you pay for... there are no shortcuts when it comes to building a civil society with opportunity and possibility for all of its citizens.
Thursday, April 16, 2009
Tea Parties?
I've been watching them and have a number of observations and puzzlements and fears.
My observations - reading comments of the participants, nobody seems quite clear what they're protesting. There are lots of concerns about taxes going up... but nobody has raised any taxes at this point. There are complaints about the government spending too much but no other suggestions for how to address the current situation other than tax cuts, which of course, got us where we are. And there is anger about helping out those who are poor or in trouble because it is obviously always their fault. And lots of poor logic... tax cuts do not cause investment in business. They cause profit taking. Higher taxes cause investment because by investing in infrastructure, you avoid the taxes.
As for redistribution of wealth... that is clearly a Biblical idea (see Acts 4 & Leviticus 25) and that is precisely was tax systems do - redistribute wealth. They only question is where and how. Sometimes it is direct and active, other times it is less direct but the result is always the same, capital moves. Under the Reagan philosophy which has held sway since 1980, wealth migrated upwards with the expectation that it would trickle down. Well, it did migrate up as wealth has become more concentrated and the gap between the wealthiest folk and the poorest folk in the US approaches that of any developing country, but it didn't trickle down.
puzzlement: Where were these folk when Bush was building record deficits? Many were saying that if you disagreed with Bush policies you were tantamount to a traitor. So why now are they marching? Do they really not understand the implications of doing nothing to help the economy? Do they not see the connection between tax cuts, a system that encouraged greed, and our struggling economy? And what in the world does any of this have to do with the Boston Tea Party? Or Thomas Paine?
It makes me afraid. In large degree the protests seem to be about fear. People are afraid of the future and feel insecure. Those are not unrealistic fears for many folk. The problem is that right wing media and politicians are feeding on that fear and deepening the polarization of our country. They are fanning the fears so that they move from rational concern to irrational terror. They are offering no solutions. They are not talking. They certainly are not listening to any other viewpoints. It is all about building up a political base who are blinded with rage and shaped by fear that is both rational and irrational and using them to gain power. That makes me worry about the future of my country.
My observations - reading comments of the participants, nobody seems quite clear what they're protesting. There are lots of concerns about taxes going up... but nobody has raised any taxes at this point. There are complaints about the government spending too much but no other suggestions for how to address the current situation other than tax cuts, which of course, got us where we are. And there is anger about helping out those who are poor or in trouble because it is obviously always their fault. And lots of poor logic... tax cuts do not cause investment in business. They cause profit taking. Higher taxes cause investment because by investing in infrastructure, you avoid the taxes.
As for redistribution of wealth... that is clearly a Biblical idea (see Acts 4 & Leviticus 25) and that is precisely was tax systems do - redistribute wealth. They only question is where and how. Sometimes it is direct and active, other times it is less direct but the result is always the same, capital moves. Under the Reagan philosophy which has held sway since 1980, wealth migrated upwards with the expectation that it would trickle down. Well, it did migrate up as wealth has become more concentrated and the gap between the wealthiest folk and the poorest folk in the US approaches that of any developing country, but it didn't trickle down.
puzzlement: Where were these folk when Bush was building record deficits? Many were saying that if you disagreed with Bush policies you were tantamount to a traitor. So why now are they marching? Do they really not understand the implications of doing nothing to help the economy? Do they not see the connection between tax cuts, a system that encouraged greed, and our struggling economy? And what in the world does any of this have to do with the Boston Tea Party? Or Thomas Paine?
It makes me afraid. In large degree the protests seem to be about fear. People are afraid of the future and feel insecure. Those are not unrealistic fears for many folk. The problem is that right wing media and politicians are feeding on that fear and deepening the polarization of our country. They are fanning the fears so that they move from rational concern to irrational terror. They are offering no solutions. They are not talking. They certainly are not listening to any other viewpoints. It is all about building up a political base who are blinded with rage and shaped by fear that is both rational and irrational and using them to gain power. That makes me worry about the future of my country.
Monday, March 30, 2009
AIG, taxes, and religious bodies
Hey I'm a Baptist. I believe in absolute freedom of religion. No government has any right sticking its nose in any matter having to do with religion. A few weeks ago I wrote a post about a movement of folk trying to get the LDS church in trouble for supporting prop 8 and that their tax exemption should be reneged.
I said "no" to this in spite of being staunchly opposed to their stand on the presenting issue.
I also made a statement in that post that puzzled a few people... Common wisdom is that non-profits don't pay taxes because of the benefit they provide to the community and the argument follows that when a non-profit breaks its covenant with the community, its tax exempt status is a benefit that can be removed. I said, "Religious groups are not taxed because the government has no say over them. The power to tax is the power to control and the state has no power when it comes to religion."
This power was demonstrated in the AIG mess when congress proposed a new tax law to tax the bonuses received by AIG workers at 90%. The power to tax was clearly the power to control. And that is why religious bodies are not taxed. If they could be taxed, then the government can control what they do and say. Indeed, that is precisely what those who wanted to remove the tax exempt status from the LDS were/are trying to do, control the actions of a religious organization through the power of the government.
I said "no" to this in spite of being staunchly opposed to their stand on the presenting issue.
I also made a statement in that post that puzzled a few people... Common wisdom is that non-profits don't pay taxes because of the benefit they provide to the community and the argument follows that when a non-profit breaks its covenant with the community, its tax exempt status is a benefit that can be removed. I said, "Religious groups are not taxed because the government has no say over them. The power to tax is the power to control and the state has no power when it comes to religion."
This power was demonstrated in the AIG mess when congress proposed a new tax law to tax the bonuses received by AIG workers at 90%. The power to tax was clearly the power to control. And that is why religious bodies are not taxed. If they could be taxed, then the government can control what they do and say. Indeed, that is precisely what those who wanted to remove the tax exempt status from the LDS were/are trying to do, control the actions of a religious organization through the power of the government.
Thursday, August 28, 2008
Obama tax cut
Here's a quick little page that gives you an idea of what will happen to your taxes if Obama is elected. Bottom line for the vast majority of Americans... you get a tax cut.
Check out your tax cut
Check out your tax cut
Tuesday, April 15, 2008
tax day
I have to tell you that tax day is not a happy day for us. As a pastor, we pay quarterly paymets so even with the best of planning, we still have to pay a chunk of money. If something didn't work correctly through the year, we pay a chunk for two years. All of that is depressing but there is more. There is a piece of the tax code that I try to ignore for most of the year but when we finally do our income taxes, I am faced with it.
We owned a home in Albany. It was one of the least expensive places to purchase a home and in the 14 years we were there, we saw almost no appreciation in the value. Still, it was a great house and there are other benefits to owning as we later came to appreciate. In California, we live in a parsonage. Owning a home was out of the realm of possibility here because property values are completely out of whack. What we hadn't really figured out though, was that the difference of not having the mortgage payment would cause our taxes to just about double.
Purchase a house and you get to deduct your interest (which just happens to be the biggest part of your house payment for most of the life of the mortgage) and your property taxes and because that pushes you well past the standard deduction, you get to deduct all of your charitable giving too. It ends up essentially being a government subsidy as you hopefully build equity while you are receiving a huge tax break. And the bigger your payment, the bigger the deduction! Rent... and you get none of that. No tax break. No equity. Nada.
So who lives in rental housing? Folk who can't afford to purchase property. So once again the haves get the breaks and the have nots get... fill in the blank.
And I know that was part of the driving force behind many poor folk getting in over their heads in the housing market... they thought that finally they could get their leg up. That just adds to the ambivalence I mentioned in the earlier posting.
We owned a home in Albany. It was one of the least expensive places to purchase a home and in the 14 years we were there, we saw almost no appreciation in the value. Still, it was a great house and there are other benefits to owning as we later came to appreciate. In California, we live in a parsonage. Owning a home was out of the realm of possibility here because property values are completely out of whack. What we hadn't really figured out though, was that the difference of not having the mortgage payment would cause our taxes to just about double.
Purchase a house and you get to deduct your interest (which just happens to be the biggest part of your house payment for most of the life of the mortgage) and your property taxes and because that pushes you well past the standard deduction, you get to deduct all of your charitable giving too. It ends up essentially being a government subsidy as you hopefully build equity while you are receiving a huge tax break. And the bigger your payment, the bigger the deduction! Rent... and you get none of that. No tax break. No equity. Nada.
So who lives in rental housing? Folk who can't afford to purchase property. So once again the haves get the breaks and the have nots get... fill in the blank.
And I know that was part of the driving force behind many poor folk getting in over their heads in the housing market... they thought that finally they could get their leg up. That just adds to the ambivalence I mentioned in the earlier posting.
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