Saturday, September 29, 2012

Why the GOP Must Stand Firm on "Tax Cuts for the Rich"


There is much more at stake in the coming political battle over extending the Bush tax cuts than a mere few percentage points of someone's tax bracket. The Left knows that whatever additional revenues flow to the government from a raise in the top tax bracket from 35% to the pre-Bush 39.6% level will be minuscule compared to the deficit. They don't care, because they're looking to fry a much bigger fish.

To understand what is at stake, we must look at the numbers. The Democrats' assault on "the rich" has taken the form of singling out the "top 1%." That is their symbol and rallying cry.

Remember that the percentage of something is relative to the hard numbers. In relation to any fixed number, the total quantity always equals 100%. If you have 100 marbles of varying sizes in a jar, the total equals 100%. If you take the largest one and shave it down so it is no longer the largest, you still have 100%; except that now the next largest one, which then becomes the largest, is not quite as large as the previous largest marble. You now have a smaller "top 1%." Continue with this process, and eventually all of the marbles are cut down to the size of the smallest--i.e., no more top, middle, or bottom 1%.

The same is true with regard to taxpayers in an industrial economy.

If every dollar of the "rich" that falls into the category of the highest 1% of income were redistributed away, reducing the taxpayers "take-home" pay below that magic threshold--effectively discouraging anyone from earning money above a certain level--the total number of taxpayers will still equal 100%. But now the next highest level of income--what was the previous 99th percentile--becomes the new “top 1%.” If their "surplus" wealth is confiscated, then the next level of income becomes the “top 1%,” and so on.

But the Left doesn't want to take it all, just a "fair share," you say? Think again. There was a time when the highest rate in America was 91%. Then came the Kennedy/Reagan tax cuts, which brought the top rate down to 28%. The rates have bounced around since then, settling at the current top rate of 35%. But make no mistake, the Left has been itching to reverse the Kennedy/Reagan tax regime, and their 1% strategy is their means. If the premise that the top 1% should be singled out for special, higher taxation is accepted, the Left will always have someone to go after. Just as the process by which we reached today's massive welfare state was a long-term, incremental process, so it will be with regard to the tax issue. As long as there is any income “disparity” whatsoever, there will be a “top 1%” to exploit--and it will be.

The logical endgame of Obama’s anti-1% crusade is a society of universal economic, rather than legal, equality; that is to say, of universal poverty--a jar full of small marbles. Then, a new top 1% will have arisen; a top 1% comprised of rulers over a command economy. This is why the Left is so feverish about the relatively inconsequential 4.6% rise in the top rate that excluding "the rich" from extension of the Bush tax cuts would engender. The Left's “top 1%" strategy fits neatly into its collectivist worldview. It is an egalitarian assault on virtually any productive person with an income above bare poverty levels. Obama’s vision is not new. It has a name. It is nothing less than a “soft” brand of Marxian communism.

How, then, will the Republicans respond? There is only one way to stop this game: Attack the principle behind it--which, really, goes to the heart of the fundamental battle between individualism and collectivism. If the Republicans cave in on taxing the rich, they will have handed the Left a "gift that will keep on giving." Once the principle that the highest earners can be singled out for discriminatory taxation, what's to stop the Left from going back to the 1% well time and time again?

There are many policy areas in which the GOP can and must halt its retreat, and draw a firm philosophical "line in the sand." It must use this battle to take a firm stand for real tax fairness--extend the tax cuts for everyone, or no one, the polls be damned. The long-term philosophical stakes are high in the coming tax battle. That is a good place to draw that line.

Related Reading:

My Challenge to the GOP: a Philosophical Contract With America

In the Spirit of Compromise, How About a Flat Tax?

Global Wealth "Redistribution" for Global Poverty: The Egalitarian Ideal, by Ari Armstrong

5 comments:

Mike Kevitt said...

A "philosophical 'line in the sand'" entails a phycical line in the sand. This is true of all the policy areas where the GOP must halt its retreat.

Concerning tax cuts, their extension must be for everyone, period!, and not, "or no one". If we allow "or no one", the Left will say, "OK, then no cuts for no one." If they can't target the top 1%, they'll go for all 100%. If they, thus, get 100%, let's not enable them to credit us for helping them by our allowing, "or no one".

And, in all policy areas, the philosophical line must be a physical line, sooner or later, physical repercussions, including violence, be damned.

The Left established statism incrementally, by our incremental and willing retreat (we feared violence, but they didn't; Chamberlain, concerning Czechoslovakia, feared violence, but Hitler didn't). If we hadn't retreated, they'd've gotten physically violent and we'd've had to enforce the law. But we were chicken.

Can we reestablish our rights, even incrementally, without incurring their initiatory violence? Any violence involving our reestablishment of our rights is automatically initiatory BY THEM. We would, thus, have to enforce the law.

Mike LaFerrara said...

My point of "extend the tax cuts for everyone, or no one" is to take a stand against tax discrimination (fairness), not to suggest that the GOP should offer both as valid alternatives. They must be willing to accept a stalemate--and thus an expiration of all of the tax cuts--because no tax cut is better than the Democrats' alternative. However, I think the Dems will fold, and then continue to use the issue against the Repubs as they have since the temporary extension two years ago.

But if they don't, keep in mind that no agreement means major federal spending reduction, too--a net positive.

As to your "the philosophical line must be a physical line," we need to be careful about appearing to advocate violence (I don't think that's your intention, but your wording could be taken that way). We didn't get to statism because our side feared violence. We got here because our side feared challenging altruism and upholding self-interest.

Mike LaFerrara said...

What I meant by "a net positive," I meant from the spending side of the ledger. There is nothing positive about raising taxes.

Mike Kevitt said...

3 My wording hardly indicates that I ADVOCATE violence, but I suppose it's such that the adversaries can spin on it, to smuggle that notion into people's heads. "Violence", or "advocating violence" is smear language. It smears initiatory with retaliatory, thus holding retaliation as "evil", "wrong", and "illegitimate" along with initiatory, making no distinction where there's a real distinction to be made.

I don't advocate initiatory violence, but, morally, I DO advocate retaliation. Practically, I advocate retaliation IF it can be made to stick without being foolhardy.

There is plenty of legislation, regulations, decrees and courtroom (that's not to say judicial)decisions which ARE NOT LAWS because they are initiations of force, thus, crimes in writing, enforcement of which are physical crimes in fact. In principle, morally, I advocate violence against THAT because it would be retaliatory, self-defence, when the "police" or other enforcement "authorities" show up. Then, it would be time to forcibly remove the offending crimes in writing, and trash'em. Then, in due time, publish the paperwork formalizing this action and explaining this action's legitimacy. Practically, I advocate all this retaliation IF it can be made to stick without being foolhardy, and then only as a last resort.

If our side has people, now, who are ready, willing and able to assert self-interest and trash altruism, let them start out intellectually, taking it clear through to where it counts: to legislative chambers, executive and regulatory offices, courtrooms and enforcement apparatus, reestablishing unincumbered law for retaliatory force against crime.

If we make, or even credibly threaten to make, progress this way (your pgm. for education tax credits requires INITIAL legislation, in this case, an actual law, "casting the die", where the rest will be only falling action since it's already a done deal), watch the continuing sheltered, covert initiatory violence we're already subjected to every day start morphing into the open, into something that looks and feels more like violence, possibly with acutely deadly effects. They're not afraid to back their initiatory force (altruism) with more initiatory force.

I simply think THAT's what the intellectual effort will run into if we ever start meeting with success: an overt morphing of initiatory violence. If, in this way, we loose any ground despite successful intellectual effort, then what? Overt physical retaliation, though morally called for, would undoubtedly be foolhardy, practically speaking. For that reason only, I wouldn't advocate it. So, then what?

If our side, eagerly asserting self-interest, doesn't fear violence, we're liable to have to show that we don't fear it, and that we laugh at it by countering it by retaliation when it's initiated upon us. How? Well, let's not be foolhardy; how ever we can, while gaining more means over time, while not giving up on the intellectual effort.

Am I going overboard with all this? If I am, I'll listen to whoever might quietly (not noisily) school me on it.

Mike LaFerrara said...

Mike; For clarity, let me summarize your position, if I understand you correctly:

As long as we are free to publicly advocate our views through speech and press, and have a (relatively) fair and transparent electoral and legislative process by which to pursue legislative or judicial repeals of rights-violating laws, retaliatory force and violence against enforcement of such laws is not justified. In the event that the losing political factions were to usurp the people’s right to self-government and sanction and support open violence against the political opposition, then retaliatory force is justified. (But then, we’re talking civil war—a distant possibility—and all bets are off.)

To expand on this, let’s ask: In the event we succeed in rolling back statism, will the people dependent on it turn violent? Unlikely, if the repeals are done right; i.e., are appropriately phased in over time, as required. And since rolling back statism in a representative republic presupposes widespread popular support, any violence by any fringe group would meet popularly supported government retaliation (criminal law enforcement). There would be no need for private citizens to “take the law into their own hands.”

Will the time for “the people” to “take up arms” against the government arrive at some point? That was the situation in the 1770s, and the Founding Fathers explained why and sanctioned any future such action in the Declaration of Independence—but only on the rarest of occasions and the most final of last resorts. We are a long, long way from those circumstances today, and will be for at least the foreseeable future. Only if and when the government removes all other options for instituting change, and living conditions become intolerable, should civilian retaliatory force be considered in a domestic political context. Even then, we still have passive resistance or “non-violent civil disobedience” as a means of bringing change. It is such passive resistance from within—from both the people and the satellite states—that ultimately brought down the Soviet Empire without a shot being fired.

It’s right to expose statist laws as initiations of physical force. But I think it’s counterproductive to even suggest retaliatory force as a possible means of combating statist laws in America today. Why go there? And the propriety of passive resistance is not evident yet, either. The correct pro-freedom course of action appropriate to America today is: Obey the laws, fight for change within the system, and don’t be a martyr.