Tax Day, 2024

Today is April 15th, 2024, the day on which most American citizens will have to have paid their federal taxes on "incomes, from whatever source derived."* It's a day most of us hate, but it represents - together with voting - one of the fundamental duties of responsible citizenship ... sharing in the costs and mechanisms of good government.

In modern America, paying your taxes isn't easy. Nor is voting in many places, for that matter. This year, as I've done every year for decades, I spent many hundreds of dollars to pay a professional to calculate my taxes and file all the appropriate paperwork to keep me out of jail. This amount is deductible on my taxes if I itemize my deductions ... but, like most middle- and lower-class Americans, I don't have enough total deductions to itemize. Unfortunately, one has to do all the byzantine calculations to determine whether or not itemization is possible. Over the years, most deductions that benefit average citizens** have been whittled away or eliminated by Congress in an attempt to make up for the tax cuts benefiting businesses and the very wealthy - those who are able to shape the tax laws to their advantage by the strategic use of donations to the right parties and politicians.

I've written about the unfairness and idiocy of our tax system many times in this space, but as a (relatively) low-fixed-income senior citizen, my voice doesn't rise above the din of outrage raised by those who pay virtually nothing in taxes and wish to pay less. You may want to remember, when you cast your vote in November, that there are a lot of people paying vast amounts of money to once again elect Der Furor and other Republicans because they promise "tax cuts." Just read the fine print and understand it's not your taxes that are being cut.

Have a good day. I hope it won't be too ... taxing. More thoughts coming.

Bilbo

* According to the Sixteenth Amendment to the Constitution, adopted in 1913. The Amendment itself is two lines long. Today's tax code is millions of lines long. Go figure.

** Such as interest on consumer loans and credit cards, and medical expenses. And consider that a billionaire can deduct many expenses related to his/her private jet, but a teacher who has to spend her/his own money on a classroom not properly funded by local government has to just eat those expenses and smile.

Tax Day, 2018

Today is the last day to file your Federal income tax return for 2017 and render unto Trump what is Trump's. You'd better do it quickly, because the combination of the administration's recent huge tax cut* and its enormous budget, means Uncle Sam needs your largess as soon as possible.

Here are a few cartoons that deal with the sheer, unutterable joy of calculating your taxes ...

Good luck.

Have a good day. More thoughts tomorrow.

Bilbo

* Hope you're enjoying the few dollars it got you. Of course, if you're a corporate titan or other part of the 1%, it probably looks better.

Looking Out for Your Welfare, Ha, Ha

Here's an interesting take on the GOPs drive for tax reform, in the language of their own justification for eliminating some popular personal deductions:

"Keeping records of these expenses is often very burdensome for taxpayers, and this current-law deduction also poses administrative and enforcement challenges for the IRS."*

I'm pleased that the GOP is so concerned about the record-keeping burdens of taxpayers that they're helping us out by eliminating the deductions many employees are currently able to claim, such as the out-of-pocket expenses teachers incur because their schools are chronically underfunded**. It will also be a joy for me to be able to stop documenting my ever-increasing and previously-deductible medical expenses.

But the GOP is not only interested in rescuing taxpayers from onerous task of documenting their deductions ... they also want to help the Internal Revenue Service deal with its "administrative and enforcement challenges." Of course, most of those challenges could result from the GOPs refusal adequately to fund and staff the IRS, but that's not important now ... nothing to see here, folks, just move along.

Oh, yes - and tax cuts for businesses are permanent, while those for individual taxpayers are only temporary.

And let's not forget the relentless GOP drive to kill the Affordable Care Act without any coherent and workable plan to replace it ... despite eight years of bitching, complaining, and staging scores of useless, theatrical, time-wasting votes to kill it.

Thanks, GOP, for looking out for the little guy ... you're the best!

Have a good day. The ones to come will be increasingly taxing. More thoughts tomorrow.

Bilbo

*  The quote is at the bottom of page 19 of the Section-by-Section Summary of the "Tax Cuts and Jobs Act" (H.R. 1), published by the House Ways and Means Committee. You can read the whole thing here. 

** In large part because of anti-tax positions of local Republican parties.

Something is Rotten in the State of Denmark. Not.

In Act 1, Scene 4 of Shakespeare's play "Hamlet," a palace guard named Marcellus sees the ghost of the dead king appear on the palace walls and suggests to his friend Horatio that "Something is rotten in the state of Denmark."

Well, there may be something rotten in Denmark, but it's apparently not rotten enough to make the Danes miserable. According to this article in HowStuffWorks, Denmark is noted for being one of the happiest countries in the world, and there are five reasons they're happier than the rest of us ... the first two of which I think are of particular interest to present-day Americans:

#1. They Trust Each Other. Wow! Trust ... what a novel concept! According to an author who has written on the issue of Danish happiness, trust in one's fellow citizens is "taught in schools and learned through everyday interactions with trustworthy and responsive institutions." I suppose there was a time in America when we trusted each other, but - except for our closest friends and family members - that time is long gone. We've fake-news'ed and insulted ourselves right out of the ability to trust our fellow Americans ... which is bad news for our civic culture and democratic institutions.

2. Their Welfare State Works. To the average American, the term "welfare state" conjures up the horror of hard-working, upright citizens forced to support a vast underclass of lazy, worthless people happy to do nothing at their expense, and a visceral hatred for taxes is encoded in the DNA of every American. But contrary to the assertion by Donald Trump and the unshakeable belief of most conservatives that Americans are the most heavily-taxed people in the world, Danes pay as much as 52% of their income in taxes. As the author of the article notes:

"... in exchange for forking over half their earnings, every Dane gets free health care, free K-college education (students are actually paid $900 a month), highly subsidized child care and generous unemployment benefits."

The article goes on to note that surveys reveal that nine out of 10 Danes say they pay these huge taxes gladly, because they see that they're getting something for it.

As my father would have said, can ya manganese that?

We Americans have so thoroughly drunk the Kool Aid of belief that government is always the enemy and taxes are always bad that we cannot conceive a situation in which that's not the case, in which we might actually be happier under a different approach to taxation and overall social welfare.

It may be that the Danish model wouldn't work on an American scale ... but wouldn't it be interesting to try?

Have a good day. More thoughts tomorrow.

Bilbo

About Foxconn and Tax Credits

I have often written about taxes in this space, as you know if you've been with me for any length of time. My position on taxes is this: I don't like to pay them any more than anyone else does, but I recognize that if I expect my government to provide services I need or want, I need to pay my share of the cost. As the American jurist Oliver Wendell Holmes, Jr, famously said, "Taxes are the price we pay for a civilized society*."

Unfortunately, taxes in this country have strayed far from their original purpose of providing funds to operate the government and provide basic services. Over the years, they have morphed into a tool for tinkering with the economy, for rewarding political supporters** or penalizing enemies, and for supporting experiments in social engineering. "Tax credits" are the go-to solution for every program a government wants to appear to support, but doesn't want to have to pay for directly.

I thought about this last week when I saw this headline in the Washington Post business section: Foxconn Deal to Build Massive Factory in Wisconsin Could Cost the State $230,700 per Worker. The story details how Foxconn, the huge technology firm that provides parts and supplies to Apple, Google, and many other companies, has agreed to build a giant factory in Wisconsin which would employ 3,000 people by 2020, with potential growth to 13,000. If the factory is built (which is by no means certain***), and if it does eventually employ 13,000 people, an economic analysis suggests that the tax breaks granted to entice Foxconn to build the plant will cost the state of Wisconsin about $230,000 per worker in lost tax revenue.

Which goes to the question I always ask when "tax credits" are touted as the solution to a problem: how will the lost revenue be made up?

The stock answer is that tax credits pay for themselves, because the losses will be made up by increased taxes on on individual earnings and on other businesses which benefit from the economic boom generated by the original tax breaks. This reminds me of the old joke that compared daylight savings time to the man who cut off the lower half of his blanket and sewed it to the top to make it longer.

As I see it, tax credits are a false solution to economic problems. Allowing individuals and businesses to reduce their tax liability, even for ostensibly good reasons, reduces the amount of money taken in by the government for use in funding its programs and operations, and that shortfall needs to be made up somehow ... usually by higher taxes on somebody else.

Americans don't like taxes, but the historical truth is that we're not so much anti-tax as we are anti-taxation without representation^†. We elect (or vote out) a President, members of Congress, governors, state legislators, mayors, and other local officials who we make responsible for decisions - with our input - on the imposition of taxes. Today, of course there's a joke that says "If you thought taxation without representation was bad, you should see it with representation." Nevertheless, although we complain bitterly about high taxes, we here in the US enjoy one of the lower overall tax burdens in the world.

So ...

If you're a resident of Wisconsin, and you're looking forward to one of those jobs at Foxconn making flat-panel displays, you should understand that you will very likely pay higher taxes on your paycheck and higher fees for other services to compensate the state for the huge tax breaks your employer is getting for giving you that job in the first place. Good luck with that.

Have a good day ... one that isn't, hopefully, too taxing.

More thoughts tomorrow.

Bilbo

* Or Donald Trump's version of America, which increasingly doesn't seem to qualify as "civilized."

** "A government that robs Peter to pay Paul can always count on the support of Paul." - George Bernard Shaw

*** According to the article, Foxconn announced plans to build a new $30 million plant in Pennsylvania four years ago, but the factory was never built.

† The Declaration of Independence castigated King George III "For imposing Taxes on us without our Consent," not for "imposing Taxes on us."

When Caesar Needs Help Getting You to Render

I think most of us are familiar with the Biblical story told in chapter 22 of Matthew, verses 20-22* ...

"20 And he saith unto them, Whose is this image and superscription?

21 They say unto him, Caesar's. Then saith he unto them, Render therefore unto Caesar the things which are Caesar's; and unto God the things that are God's.

22 When they had heard these words, they marvelled, and left him, and went their way.

This story is the basis of the separation, in Christian tradition, of temporal and spiritual authority. "Rendering unto Caesar" is sometimes used as shorthand for paying taxes to the various temporal authorities who are legally entitled to dip their sticky fingers into our pockets.

But what happens when Caesar isn't able to enforce all the rendering he's expecting? There's an empire to run, after all ... somebody has to make sure we're doing all the rendering we're supposed to do.

And that's why the Internal Revenue Service, suffering from years of budget cuts and benign neglect, mostly from tax-hating Republican members of Congress, has decided it needs help, and has announced plans to contract with four commercial debt collection agencies to go after those who have insufficiently rendered unto Caesar.

Yes, folks, after years of the IRS warning you that it would never contact you directly by phone to demand payment of taxes, it is now contracting with professional debt harvesters who are authorized to contact you directly by phone to demand payment of taxes.

This is not good, and not only because it will make it far more difficult for the average citizen to differentiate between legitimate tax collection and the ubiquitous scams in which despicable thieves call citizens directly and demand payment of an alleged tax debt.

When I was working as a contractor for the Air Force, I learned about the concept of inherently governmental functions. What this meant in practical terms was that there were certain things that I, as a contractor, was not permitted to do. I could, for instance, go to meetings as a representative of the Air Force office I supported, but could not define an official Air Force position on an issue or commit the Air Force to any expense or course of action. I was permitted only to take notes and report back to my government customer, who would then decide what to do and take the appropriate action.

One definition** states that an inherently governmental function is “a function so intimately related to the public interest as to require performance by Federal Government employees.” In my opinion, for what it's worth***, the collection of taxes - the ability of an agency of the federal government legally to seize my wealth and punish me if I fail to give it up - is the very definition of an inherently governmental function. In what universe is it appropriate for a commercial entity to wield such power?

So, Dear Readers, be very careful in the future when somebody calls you on the phone and says they're representing the IRS and demanding payment of a tax debt. Supposedly, the IRS will have first sent you a letter telling you to expect contact from a collection agency before anyone calls you. This means that now, not only do you have to worry about scam phone calls, but you also need to carefully review and confirm the authenticity of any letter you receive that claims to be from the IRS.

And that, friends, is an inherently personal ass-covering function.

Have a good day. Beware of scammers.

More thoughts tomorrow.

Bilbo

* King James Version.

** In The Federal Activities Inventory Reform (FAIR) Act of 1998. 

*** Not much, I can tell you.

Bilbo Pontificates on Energy, Transportation, and the Environment

Back in 2007 I wrote a post titled Thigh Bone's Connected to the Hip Bone, etc., in which I suggested that we as a nation were being pretty dumb by looking at all our problems in isolation rather than as part of an interconnected system in which responses to one issue have ramifications in other areas. That idea - my concept of government, society, law, and the economy as a system rather than a group of unconnected activities - underlies my thinking on virtually every discussion of the issues we face. In the last few posts, I've talked about approaches to immigration reform, foreign policy, tax reform, and the economy in ways that try to address how the solutions are all interconnected. Today, let's think about how energy, transportation, and environmental policies all fit together (and, of course, fit with all the others).

Tax reform is difficult enough to think through, because there are so many vested interests that benefit from the current system in one way or another. The same applies to developing energy, transportation, and environmental policies, except that it's almost worse: our current slapdash approach combines the worst features of tax policy, agriculture policy, housing policy, foreign policy, environmental policy, the oil industry, the nuclear industry, vast swarms of lawyers and pundits, and probably several others I've forgotten. If the country needs a tax system that looks like someone designed it on purpose, it needs other comprehensive policies at least as badly.

Here are my thoughts ...

1. Immediately Start Up Manhattan Project II to Develop Safe, Reliable, Renewable Alternative Energy Sources. During the darkest days of World War II, when victory against Nazi Germany and Imperial Japan was not yet a foregone conclusion, President Roosevelt authorized the Manhattan Project to develop the atomic bomb. It was the most expensive crash program in American history, harnessing the efforts of the nation's finest scientists in a money-is-no-object effort to develop the ultimate weapon to defeat the ultimate evil. Today, we need a new Manhattan Project to break our reliance on fossil fuels. This effort would be funded by a tax on oil company profits, a small tax on gasoline- and diesel-fueled vehicles, and a small parallel tax on gasoline at the retail level (not more than 2 cents/gallon).

2. Open the Yucca Mountain Repository for the Safe Storage of Nuclear Waste, and Do Not License Any New Nuclear Plants Until It Is In Operation. Nuclear energy is often touted as an environmentally safe, clean source of energy, and it is ... for the short term. The elephant in the nuclear room that no one in the industry wants to discuss is that nuclear power generation produces radioactive waste, much of which will be deadly for tens of thousands of years (see my earlier post "Don't Dig Here"). If we are going to rely on nuclear power, we must accept the risks inherent in its waste, and must have a secure, remote place to store it that's as safe as we can make it. Yucca Mountain is probably as safe a place as we're likely to find on the earth.

3. Shift Ethanol Production From Corn to the Use of Other Agricultural Waste Products. If ethanol continues to be used as a component of gasoline, it should be made from products other than corn. Reliance on corn distorts agricultural prices and policies and eats up valuable land that could be used for growing other staple products.

4. Require That All New Construction Employ Environmental Principles. "Green" construction techniques and building features will help save energy both in construction and throughout the life of the structure. Built-in solar panels in areas with abundant sun or geothermal units in geologically active areas, "green roofs" for insulation (and gardening), and a return to the use of natural construction materials instead of plastics will all help to conserve energy by minimizing the need for electricity and relying on renewable natural energy sources.

5. Ban the Manufacture and Use of Non-Biodegradable Plastics for Packaging. There are vast islands of floating plastic bags in the oceans, hazardous to fish and plant life and not going away in our lifetimes. Landfills are choked with plastic trash. We need to get away from the use of such materials now. Many stores are offering reusable bags; their use should be made mandatory, as should the use of biodegradable products for packaging of all types.

6. Invest in the Nation's Rail Network. Railroads can move vast amounts of cargo over long distances at cheap rates while using less energy than long-haul trucks. Modernize and expand the nation's rail system for both passengers (in high-traffic areas like the East Coast corridor) and for cargo (nationwide).

7. Encourage Expansion and Use of Mass Transit in Major Metropolitan Areas. Buses, light rail networks, and similar mass transit methods save energy while moving large numbers of people. Encourage use of mass transit by expanding networks to serve larger areas and by limiting the ability to drive in urban areas (for instance, by reducing availability of parking). This will be very difficult, as we're a nation that loves its cars and the individual freedom and flexibility they offer ... but they turn open land into roads and parking lots, turn fossil fuels into carbon exhaust, and are a long-term threat to the environment.

That's the basics of my energy policy. Take your best shot. Some of my friends and commenters have already pointed out that everything on the list is going to be expensive and problematic in some way, but we need to do something. If you don't like my ideas, don't just say they won't work ... propose something better.

Have a good day. More thoughts tomorrow, when we announce the Right-Cheek Ass Clown for September.

Bilbo

Bilbo's Personal Income Tax Reform Plan

Yesterday I offered my thoughts on a rational and realistic foreign policy for this country. Since I'm on a roll, why not dust off and update my post from back in 2008 on tax reform? As a result of years of political shenanigans and misuse of the power of taxation by governments led by both parties, this is an enormous, highly-charged, and vastly complicated problem to solve. For this reason, I’ll approach it in sections; today, we’ll look at personal income tax.

The fundamental problem with income tax system in this country is that we have forgotten that the purpose of taxation is to raise money to fund the operation of the government, not to implement social policy or to solve (or sidestep) other problems. The Founders knew that the government needed the power to levy taxes ... their problem was not with taxes per se, but with taxation without representation, which is why they vested the power of taxation in the legislative, rather than the executive branch of government. Citizens have a duty to pay taxes to operate government at the national, state, and local levels, and each level executes different types of responsibilities. Governments at each level have a duty to manage the people’s affairs and money in such a way as to ensure that the tax burden is the minimum required to fund necessary and efficient operations. Here's what the Constitution has to say on the subject:

Article 1, Section 7: All bills for raising revenue shall originate in the House of Representatives; but the Senate may propose or concur with amendments as on other Bills.

Article 1, Section 8: The Congress shall have power to lay and collect taxes, duties, imposts and excises, to pay the debts and provide for the common defense and general welfare of the United States; but all duties, imposts and excises shall be uniform throughout the United States.

The 16th Amendment: The Congress shall have power to lay and collect taxes on incomes, from whatever source derived, without apportionment among the several States, and without regard to any census or enumeration.

When tax policy is used for purposes other than raising operating revenue, it creates a problem which cascades through the economy and the society. When, for instance, the federal government grants “tax breaks” to a particular special interest group, offers “tax credits” as a way of reducing costs of programs or services to taxpayers, or uses “tax incentives” to garner support for particular programs or activities, the revenue those taxes would have brought in is now no longer available and must be made up somehow. Popular alternatives include:

Shifting the tax burden to other groups. This is what happens when the tax code allow higher-income taxpayers to pay proportionally less tax than less-affluent citizens, either by complex and targeted deductions or more advantageous tax rates;

Increasing levies on individual taxpayers. This is the usual route, as individual taxpayers in the middle and lower economic classes generally lack the organized political power to fight the additional tax burden;

Imposing fees for services that were previously provided free of charge, or increasing fees already in existence; and,

Increasing government borrowing (includes both direct borrowing and the sale of bonds and other treasury securities). This avoids the political heat involved in taxing other industries or individuals, but pushes the problem down the road by increasing government debt and incurring the interest payments on that additional debt. It also dries up money that would otherwise be available for individuals and businesses to borrow.

The tax code as it exists today is an unworkable farce. As a result of laws which change each year, special breaks and incentives provided to special interests, and the use of the tax code as an instrument of social policy rather than revenue collection, the size of the complete code is mind-boggling: according to estimated figures provided by the Tax Foundation for 2013, the US Tax Code is 74608 pages long. It’s no wonder that an entire industry of expensive tax preparation specialists and tax lawyers has become necessary to assist citizens in calculating their taxes, filing their returns, and defending themselves against the often-draconian penalties involved when inevitable errors are made.

This, as my father would have said, is no way to run a railroad.

We must return to a tax system that, as former Treasury Secretary William Simon once said, looks as if someone designed it on purpose. We must have a tax code that is fair, easy to understand and implement, and raises just enough revenue to operate the government and provide the services that the majority of the citizens expect.

I propose completely scrapping the tax code in its present form, and replacing it with a graduated flat tax. Basic elements of the proposed new federal income tax structure are:

1. All income earned within the United States, regardless of source, is subject to taxation. The US is the only country that taxes personal income not earned within the borders of the nation. It's time to catch up with the rest of the world and limit taxation of personal income to that earned here at home.

2. All deductions and credits are eliminated. This would both tremendously simplify the tax code (most of which is designed to explain the arcane calculations of various deductions) and increase the amount of potential revenue.

3. Tax rates are low, but progressive and scaled to gross income. The initial proposal is:

$0 - $50,000 per year: 1-5%
$50,001 - $100,000 per year: 6-10%
$100,001 - $500,000 per year: 11-15%
$500,001 or more per year: 16-20%

By contrast, consider that the highest federal tax bracket for 2015 (levied on incomes over $464,850) was 39.6%. Oh, and what's the logic of an odd figure like $464,850 as a break point, anyhow?

Under this proposal, some people in the very lowest economic categories will be required to pay taxes, which they may have avoided in the past, and some people in the upper income levels will pay less. The burden is, however, spread more equitably and the elimination of deductions and credits not available to everyone suggests that lower rates overall can produce equivalent or greater revenue.

4. Income reconciliation and tax calculations are spread throughout the year, with the month for tax submission based on the last two digits of the taxpayer’s social security number. This eliminates the enormous national trauma of every taxpayer submitting their returns at once, swamping the IRS collection system and inviting the type of errors inherent in processing such a vast number of returns in a short time. Taxpayers whose social security numbers end in 01-10 would file in February, 11-20 in March, etc. This would finish up submissions with 91-00 filing in November, leave two months free for the IRS (or its successor) to work on crunching the numbers, and not require anyone to pay taxes during the November-December holiday season.

Now, I'm not an economist. You could put everything I know about economic theory into your navel and still have room for a herd of elephants and a brass band. But I have to believe, based only on some rational, common-sense thinking, that overall rates can be radically lowered for almost all taxpayers if we just return to basics: tax all income, eliminate all deductions and credits, and use the tax code for revenue generation rather than as a political tool or a means of implementing social policy.

This is my plan for personal income tax reform. Take your best shot.

Corporate tax policy is much more complicated. I'm not a businessman and don't know much about tax implications for business earnings. So discussion of that part of my economic reform plan will have to wait until I can do more research, talk to people smarter than I am*, and think it all through.

If you want to look at the comments that were made on the original version of this plan from back in 2008, the post is here (this is the same link I provided earlier in the post).

Have a good day. More thoughts tomorrow.

Bilbo

* There are a lot of them, so it may take a while.

Rendering Unto Caesar

Yesterday was April 18th, the day on which - because the 15th fell on a Friday - we Americans had to cough up our share of the dollars Uncle Sam uses for all the things he does. You have no doubt seen many tax-related memes and cartoons ...

... and have no doubt bitterly complained about the Internal Revenue Service, government spending, and taxes in general. As the old joke goes, if the Founders thought taxation without representation was bad, they should see it with representation.

Which brings me, however circuitously, to my point: while we all hate the IRS and its mind-numbingly complicated forms and inability to provide basic advice and service to taxpaying citizens*, it's the representation part that we ought to be criticizing. After all, the IRS - intrusive and heavy handed though it is - is only executing the horrifically complex tax code written by the reprehensives you and I elected. 

As I've written here before, I don't object in principle to paying taxes because I recognize that taxes provide the money our government needs to operate. I may (and frequently do) object to what those taxes are being spent on (services of any kind for people in the country illegally, for one), but I understand that I have an obligation as a citizen to cough up my share. My biggest issue is the overall unfairness of the system.

Of course fairness, like beauty, is in the eye of the beholder. If you are wealthy, fairness means that you don't pay any more proportionally than a person of lesser means; if you are a business owner, fairness means that your tax burden limits your profits as little as possible; if you are an ordinary member of the dwindling middle class, it means that you pay a fair share compared to others and not a cent more; and if you're a poor person, it means that the Big Bad Government either doesn't tax you at all or actually pays you something.

Most of the "tax dodges" many of us complain about are perfectly legal, which doesn't make them fair other than to those who were able to get them enshrined in law. If you have the means to hire good tax lawyers and purchase the right legislators, you can get the law written to your advantage ... fair to you, that is ... less so to the rest of us, who have to make up the difference.

The situation isn't going to change, however much the 99% might wish it so. The tax code is written by and for those who have the means to adapt it to their needs. The tax code is mind-bendingly complicated and will remain so, because an insanely complex code supports a huge industry of tax preparers, tax consultants, tax attorneys, and tax software developers. And it will remain so as long as we use taxation as a vehicle for social engineering, business development, and political punishment rather than as a vehicle for bringing in funds to operate the government.

It's not fair and will never be fair ... the best we can do is try to expose the most egregious abuses of the system, whether they are legal or illegal, and hope that some tiny, incremental changes might be made.

Rub that lamp, and ask the genie for tax code reform. It's the only thing that will work ... unless, of course, the genie has already been suborned by someone with deeper pockets.

Have a good day.

More thoughts tomorrow.

Bilbo

* You can blame that part on Congressional conservatives who hate the IRS and believe that slashing its budget will punish it for its misdeeds. Where I come from, we call this "cutting off one's nose to spite one's face."

Of Taxes and Libraries

As you know, today is April 15th, and every American knows what day that is - Tax Day ... the day on which we render up to our federal Caesar that portion of our personal fortunes to which Caesar lays claim. If you are a hard-core Tea Party Republican or a Libertarian, your head exploded when you read that. If you are an average American, at the very least it made you cranky.

Nobody likes to pay taxes, myself included. But taxes pay for the things our government does. Some of those things we expect, like, and even demand. Some, we don't. But guess what? We elect the people who decide how much tax we pay and what those taxes are spent on. Don't like paying taxes, or what your government spends those taxes on? Quit bitching and elect someone else.

Okay, end of fulmination. Now let's talk about one of the good things those taxes pay for ... libraries.

April 12-18 is National Library Week. Libraries make books available to everyone ... especially to those who might otherwise not be able to afford them. They further the education of our citizens, and help them make good decisions. They provide a safe and exciting place for our children to learn, to hear stories read aloud, to practice arts and crafts and to broaden their young minds. Libraries are an investment in the future - a part of the infrastructure of the mind.

Of course, we could spend all that money on corporate welfare and on tax benefits for already-wealthy people who don't need them. If that's what you want the government to spend your money on, you know who to vote for.

And you deserve what you get. Too bad the rest of us will get it with you.

Have a good day. Support your local library. More thoughts tomorrow.

Bilbo

Deep in the Heart of Taxes. Sorry.

There are lots of silly things that show up on the Internet. This blog, for instance. But I like to think that I, at least, bring some thought and analysis to the things I write, unlike many of the things that are driven by brainless passion for a specific political position or religious belief.

I call your attention, Dear Readers, to an item that's been going around on Facebook, designed to drive every red-blooded American crazy: A List Of 97 Taxes Americans Pay Every Year.

I have written many times in this space on the subject of taxes, which I dislike paying as much as anyone else. I understand, however, that taxes are a sad but necessary part of citizenship ... the burden we share in paying for a government that provides the services we have come to expect. If it weren’t for taxes, after all, how would the government function? If you believe that Americans would be lining up to volunteer their time and money to build roads and bridges, teach school, and make sure public utilities are available, then I have some prime swamp land in Florida and a bridge in New York to sell you.

Want to get someone really mad? Come up with something like "a list of 97 taxes Americans pay every year." And then trust that no one will really read the list and think about it.

I read the list. And I thought about it. And I got really mad. But not for the reasons you might think.

It is perfectly clear that we pay lots of different fees and taxes which are imposed at every level from the Federal government on down. Governments need the money to pay for the things they do just like we need money to buy food, clothing, shelter, health care, pornography, etc. I get that. But the “list of 97 taxes” implies that it’s a list of 97 separate taxes that burden every single American.

The trouble is, it ain’t so.

A quick look at the list suggests a few observations:

- First of all, you can significantly reduce the list by combining things that are the same, but have different names (Garbage Tax and Waste Management Tax; and Highway Access Fees, Toll Booth Taxes, and Tolls come to mind).

- A Cigarette Tax doesn’t affect you if you don’t smoke, and a Liquor Tax doesn’t affect you if you don’t drink. And to the extent that they encourage people to smoke or drink less*, it might be argued that they are actually beneficial by reducing the cost of health care for everyone else.

- Garbage Taxes, Waste Management Taxes, and Hazardous Material Disposal Fees. Onerous? Perhaps. But how else do you propose to pay for the facilities to safely dispose of your trash and your hazardous waste? And if you live in an area where the Big Bad Government isn’t taxing you to do this … does the company that picks up your garbage do it for free out of the goodness of their community-minded hearts?

- Sewer and Water Taxes. I suppose you don’t need to pay these if you don’t need or want clean water, or if you’re willing to dig a latrine or build an outhouse in your back yard, or manage your own septic tank. And why is it wrong to ask industries that pollute the water you drink to pay for helping to clean it up?

- Highway Access Fees, Tolls, Gasoline Taxes, and Interstate User Diesel Fuel Taxes. A pain, to be sure. But how else do you propose to raise the money to build and maintain roads and bridges? Perhaps the "Adopt a Highway" program could be made mandatory and include the responsibility for paving and pothole repair along with picking up trash.

And …

- Passport Fees. The last time I looked, nobody was forcing anyone to travel abroad. If you don’t leave the country, you don’t need a passport and don’t need to pay the fee. If you do need to travel abroad, why should I pay the cost of issuing you a passport? What’s your problem?

Now, to be fair about it, there are some fees and taxes on the list that tend to piss me off:

- Sports Stadium Taxes. If a major league sports team wants a new stadium, they should fund it themselves. I don’t see it as my job to sweeten the deal for a team whose owners are multi-millionaires and whose members probably make more than I do. And don’t forget that on top of those taxes that were levied or bonds that were issued to build the stadium, you’ll also pay a gazillion dollars for tickets to see the games played there, and about $8.00 for a hot dog.

- Air Transportation Taxes. These are way out of control. I wrote in this blog some time back about the difference between the airfare the airlines quote you - which is often not “cheap,” but “reasonable” – and the final price that goes on your credit card, in which the accumulated taxes and fees often double the cost of your trip. This is insane. And combine that with ...

- Hotel Taxes. These are also way out of control, and usually consist of three or four separate taxes on the same room charge: a sales tax, a hotel tax, an occupancy tax, and a tourism tax, to name a few. They can easily add hundreds of dollars to a vacation hotel bill.

So what’s my point?

The article that railed about the “97 Taxes Americans Pay” is stupid. People who read it without thinking, get spun up, and post it on Facebook or elsewhere and rail about robbery by the Big Bad Government are stupid, too. Nobody likes taxes. But before you scream about them, consider the things they pay for, and how you propose to pay for those things without them. Just what services and activities we want to pay for with those taxes, and how high the level of taxation ought to be to pay for them, is a matter for calm and rational discussion … but just screaming bloody murder about evil taxes does nothing except make you look like an idiot.

Okay, end of screed.

Have a good day. Don’t overtax yourself. More thoughts tomorrow.

Bilbo

* And don't whine about the Nanny State. If your bad habits impose costs on me, I have no problem with taxing you to bear the cost of your bad choices.