[freedomtowernight_edited.jpg] 26th Parallel: Tea Party Summary

Thursday, April 16, 2009

Tea Party Summary

Our neighbors to the north at East Central Florida Gazette have a good account of yesterday's Tea Party events. Not strictly a blow-by-blow account of the proceedings, but instead a balanced description of the meaning and purpose behind the events - which have been largely distorted (not surprisingly) by the MSM.
If you visit any of the echoing chattering nodes of the Left, you will be greeted by a circular shouting match that goes something like this: "Rightwingers, Rethugs, Repiggies, etc...are crazy, delusional and in denial about taxes, Obama and the War on Islamic Terrorism." The common Dailykos/HuffPo/DemocratUnderground assessment of these rallies is either A) These Americans are crazy or B) If they are not crazy, then they are stupid and/or greedy because taxes are low already.

The giant flaw in this scintillating logic is that the protests were primarily about spending and the role of government in each American's life. The Left is correct in that taxes are historically low, as a percentage of GDP. They are dishonest in describing what the scope of government intrusion into each American's life will be under the proposals offered by the Obama White House and the Pelosi/Reid Congress. They are also disconnected from a more serious problem than income inequality, and that is tax burden inequality. The bottom 40% of Americans effectively pay no income taxes at all, while the top 20% shoulder 75% of the total tax burden. We have become a society where many have no interest in taxes as they do not pay them, or at least enough to be concerned. These non-burdened Americans will always be predisposed to ask for higher taxes and more government, while an ever dwindling share of the populace foots the bill for the whole country. Aside from the economic deficiencies that attend a narrow tax base, there are moral ones as well. No country in history has ever survived where the majority of its people did not contribute to the maintneance of their country.


Blogger Jonathan said...

The notion that taxes are historically low is inaccurate. Federal spending and tax receipts as a percentage of GDP are at around the same levels they've been at for many years. However, those are high levels when you also take account of the burdens of state and local taxes, and of regulations (which are a form of tax). Also, state and local tax rates and tax receipts are historically high and are increasing. And tax rates on capital and corporate profits are extremely high by world standards, a significant drag on US productivity. Finally, the Democrats' enormous new spending and energy-tax proposals, if enacted, are guaranteed to increase substantially taxes at all levels of government, so whatever the nominal tax rates are now they are sure to go a lot higher in the next few years.

If you want to get an idea of the overall tax burden just look at the proportion of GDP controlled by government. Govt spending equals taxes, either directly via tax collections or indirectly via increased interest rates, business costs and monetary inflation (or all of the above, as seems to be what we are about to experience). Broadly, we are heading from total govt spending @ around 30% of GDP to total govt spending at European levels of 40%+ and that is what people are worked up about.

We have a lot to be worried about, tax wise.

3:43 PM, April 16, 2009  

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