I disagree with your whole premise that government has ANY responsibility in redistributing wealth. What sort of Marxist message are you trying to send? One thing that people that make this argument always fail to address is that in America people have the same opportunities to start a business, invent a new tool etc. All Americans have the same ability to use the tax code to write off the expense of running a business. Some people choose to use them while others do not.

Another thing that is never addressed is that a large percentage of those low income earners are low income earners because of the choices they make. I just moved out of a neighborhood of 12 years in Del City, Oklahoma, a suburb of Oklahoma City. My neighbors were living in section 8 housing with no electricity though they had plenty of money to party all night every night. They would sit in the front yard with the kitchen table with 10 – 15 teens smoking pot and drinking beer day and night. The police would be over there almost every day until the house was eventually condemned for occupancy because they had no electricity. The reason we finally moved out of there is because my own son was doing drugs and arrested on several occasions.

My point in all this is that many of you that believe in redistribution of wealth are very quick to punish those that produce and earn a living as though they must have gotten their wealth in some dishonest way. You never want to discuss why these people are low income in the first place. People need to wake up and understand that this whole progressive tax system and the class envy is a calculated political move by Marxist Communists. If you think I am making this up, just go on Google and search for their web site at by searching for "Fifth International". This is a Communist web site that tells of their goals and objectives. Chief among them is the elimination of private property by revolution. They achieve their goals by dividing groups of people against rich people. You can read all about it in Karl Marx's own Communist Manifesto.

The one thing that Communists never want to talk about is that they use Socialism as a temporary phase between Capitalism and Communism. Communism advocates a totalitarian rule for a limited time to prevent the bourgeois (rich) from stopping them. Unfortunately history will tell you that human nature makes people greedy and power hungry. Once this totalitarian regime gets control for their limited time, they like it and never give it up. Those that disagree with their views conveniently disappear. Look at the history of Communist nations and you will find that they are usually run by a dictator.

Do not fall into these economic arguments where the author takes the premise that government's responsibility to redistribute wealth is just the way it is. No it is not. Government has zero responsibility and in fact it is an over step of authority to attempt to do such a thing. The truth is that some people are motivated and others are not. Some people could be given $1 million and would be poor again within days. The problem is not an unequal distribution of wealth but an unequal distribution of common sense. Most people are innocent and just want the best for everyone and do not think in terms of agendas. They are the ones that fall prey to this argument. They are the ones that do not understand all the details but have good intentions.

People in this country DO have equal opportunity but because of the culture war and people exploiting racism, class envy, they have convinced people that they are victims when they are not. They are only victims in that they are not being educated but rather being indoctrinated that they are victims and that rich people are to blame. Instead of preaching victimization they should be educating them on the opportunities that are right in front of their faces.

Socialism/Communism ignores human nature that once it is achieved, there will not be an equal distribution of wealth but rather a dictatorship where all are poor and the totalitarian state has all. There will be no bill of rights. They will have you believe that the people will have the power when in reality human rights will be gone. They ignore that our Democracy claims they are a government of the people, for people, and by the people and yet they claim that the poor are somehow enslaved to the rich. They assume that people of wealth are exploiting those of less means when the reality is that some people will never get off their butts and make something of themselves. They have the same opportunities to start a business and write off their expenses as Walmart does. Don't buy into this class warfare game. You are being played to get you angry so that you will eventually participate in a violent revolution against the bourgeois class when you have just the same opportunities as they do.

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Thanks for sharing your, well, colorful views. I particularly appreciate the following, completely sane and logical, sentiments:

"Any politician who attempts to pass legislation to make us more like those european countries SHOULD be labeled a socialist and have their faace plastered on posters with a Hitler mustache because they would be Socialist."

You're totally right. Any politician who recognizes the importance of government in providing goods that the free market fails to provide, such as universal education, affordable health care, roads, defense, and so on, should clearly portrayed as Hitler, because clearly what they stand for is the same as what Hitler stood for.

I also appreciate your comment: "I applaud all those “rich” people who manage to hide their money in offshore banks and otherwise out of the reach of Uncle Sam because Uncle Sam needs to learn to live within it’s means..not act like the Mob shaking us down to take what they have no right to."

After all, what could be more patriotic and pro-American than hiding your income from the American government, which after all, has not provided the American people with a SINGLE benefit in its 200+ years of history except the Constitution itself, which in your view gives the government the right to do nothing to promote economic well-being of its citizens.

You could not be more correct that because of the greed and selfishness of the super-rich who prefer to hide their incomes and wealth the US government has been forced to live beyond its means. Wasteful government spending, particularly on America's bloated military, has forced the government to borrow billions that it could be collecting in taxes from those Americans who are most able to pay taxes, the super rich, whose incomes have actually grown over the last several years, increasing the wealth gap in the US to its greatest level since 1929, putting us roughly at the same income and wealth distribution as most sub-Saharan African nations or corrupt Latin American dictatorships of the 1980s.

Surely this is the America the founding fathers had in mind when they wrote your beloved Constitution. One with an education system that produces math and science students ranked in the lowest 10% of the industrialized world, one with a crumbling infrastructure and a public transportation system that was long ago surpassed by the lower-income nations of South East Asia and Eastern Europe, one with a military whose budget consumes 60% of American taxpayers' money and one in which $400 billion a year is paid to foreign holders of US debt because politicians are too afraid to make any meaningful steps towards balancing the budget by increasing the marginal tax rates on the richest 2% of households in what has become the most unequal society in the developed world.

So thanks for your valuable, completely rational, insights. I hope you find some more posts on this blog that you will feel inspired to leave such thoughtful comments on.

I'll look for you in the audience at the next Tea Party rally, I assume you'll be the one holding the poster portraying Obama as Hitler!

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People really have to start looking to the government to provide everything for them because truth is..the government is far more of a harm than a benefit in anything it provides. I am an American..I DON'T want to be more like our European "friends" because what works there won't work here. If the government only did what the Constitution explictly said it could do (and it's a limited list) then we wouldn't need to raise taxes on anyone because we'd have more than enough money taken in to pay for the things the Federal government is authorized to do. So I say "NO" to the government doing more for me..I want them to do less and basically leave me alone. In my opinion we have NOTHING to learn from our Northern European "friends" and why should we do something just because other countries do them? Any politician who attempts to pass legislation to make us more like those european countries SHOULD be labeled a socialist and have their faace plastered on posters with a Hitler mustache because they would be Socialist. Perhaps the progressives among us who want to redistribute wealth (steal from some and give to others what they have not earned) and basically have the government be both Mother and Father to us should learn a thing or two from JFK who said "Ask not what your country can do for you but ask what you can do for your country." On a final note I applaud all those "rich" people who manage to hide their money in offshore banks and otherwise out of the reach of Uncle Sam because Uncle Sam needs to learn to live within it's means..not act like the Mob shaking us down to take what they have no right to. I'm just waiting to be able to say "I told you so" when the economy completely collapses due to Obama's marxist policies.

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Sure, those who earn the most may be paying half of their hard earned income to the government in taxes, but imagine being able to retire at 62 and enjoying a generous and guaranteed government provided pension until you die. Imagine going through your life NEVER having to worry about what would happen if you broke a leg or came down with an illness while in between jobs, since you are given health insurance for life just for being a citizen! Wouldn't you be happier and less stressed, more content and relaxed if you could live a life free of the financial anxiety brought on by the costs of health, education and retirement in America?

I heard a great episode of NPR's Planet Money recently where the host went to Denmark (http://www.npr.org/blogs/money/2010/01/podcast_tax_me_please.html) which was voted this year as one of the the happiest countries on earth, to figure out exactly why those Danes were just so darn happy about their lives. What they found were several European immigrants (from other RICH European countries) who had actually moved to Denmark to work in regular old jobs, precisely BECAUSE the taxes were higher there. People interviewed actually said they moved there because the taxes were higher, therefore they were able to enjoy a more comfortable quality of life due to the generous provision of goods and services by the government.

In the spectrum between total freedom and total government control, I tend to think that total freedom may at times lead not to happiness and individual liberty as much as it leads to stress, uncertainty, anxiety, poor health and a life of never-ending debt and financial distress.

Don't get me wrong, I believe in liberty and the efficiency of free markets. But in certain cases, particularly health care, education and the responsibility for the nation's elderly, the United States has a lot to learn from its Northern European friends. But why don't we have the same system? Because any politician who attempts to pass legislation to make us more like them is instantly labelled a socialist and his face is plastered onto posters with a Hitler mustache on it and marches are led by those claiming we'll be like North Korea in no time!

Go figure, Americans want to take care of themselves, let them… In the mean time, I'm happy to be an American living in Europe, for the time being at least!

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Your response to Brad is very interesting and I second your opinion for the need for progressive taxes to redistribute income. I really liked how you pointed out that capital is essential for research and development which would mean it is usually the rich that conduct R&D and become richer as a result of this. I also believe that while entrepreneurship and innovation is necessary, also the work of, for example, construction workers is vital to an economy to for instance maintain transport systems and create new buildings.

@ Marcelo,

I think Laura means regressive tax, which is probably why she says "people don’t have enough income to pay for their consumption."

-Eline

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Taxes are necessary because the government can use its revenues to spend in public goods, such as defense, education, public transport systems or road construction. If these goods were not public goods they would be more expensive and not everyone would be able to use them – they would then be characterized by excludability and rivalry. In Belgium, tax revenues are used to maintain, amongst others, health care, which ensures Belgian citizens are healthy and therefore more productive, the public transportation system, which increases the efficiency of the economy, and education as this too will increase the productivity of the workforce.

2. Discuss the claim that a progressive tax system stifles innovation, entrepreneurship and incentive to work.

A progressive tax system is seen by some people as "a punishment for the rich" as it, by demanding the highest tax rate from the rich, in a way penalizes the rich for the hard work they have inserted into becoming rich. Therefore people would be discouraged from investing into research or development or working harder with the purpose of becoming more wealthy, as they would see a great portion of their income disappearing to tax. I personally disagree with this claim as the richest will always have enough money despite the fact that a lot of it goes to taxes, and though they might have worked hard to become wealthy, as soon as they are wealthy they will be merited a lot more than someone with lower income working twice as hard.

3. On whom does the largest burden of a sales tax (like the fair tax) fall? Is a sales tax “fair”? Why or why not?

The largest burden of a sales tax falls on low income people, as a larger percentage of their income goes to this tax than with high income people. Therefore a sales tax is not "fair" as the rich will benefit from this will the poor will see more of their income going to tax, and incomes will be distributed unfairly.

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I dont understand the fact that you are saying that government's taxes pay their taxes… However, I do believe that with the taxes payed by rich and poor, the government uses this money to invest, develop and improve goods and services for society, in terms of public goods, as such as education, health, social security, etc.

Armando

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2. I disagree since the tax percentage increases the income, meaning people will still earn more than before.

3. For the poor, according to their income they are consuming a major part of their income in taxes, unlike the rich is almost nothing.

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What you say is completely contradictory! You have to remember that the rich pay for the regressive tax too. They also consume. How is it fair if they must pay high rates of progressive tax in addition to regressive tax?

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Taxes are necessary to facilitate government welfare for the poor people AND rich people. Public transportation system, maintenance of roads, utility, social healthcare system, or any type of government industry are funded by tax revenue, and without, the government won’t be able to operate these public goods. In Japan, the public transportation system and police departments are maintained by tax. Without our daily transportation method would be extremely difficult and the security of the citizen is not established without police.

2. Discuss the claim that a progressive tax system stifles innovation, entrepreneurship and incentive to work.

The rich people in society are usually the ones who worked the hardest to reach to their positions with their creativity and innovative invention. The progressive tax system would disrespects the achievements of the successfully people and penalize them for their hard work, when they should be rewarded for their contributions to economy.

3. On whom does the largest burden of a sales tax (like the fair tax) fall? Is a sales tax “fair”? Why or why not?

In theory, the regressive tax is more advantageous for the rich people because the tax constitutes more percentage of the poor person’s income than rich. However in reality, the largest burden of a sales tax is probably the richer people because they are the people who consume more. If they consume more, majority of the sale tax revenue comes from the rich people.

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Do you think that the government's combination of the progressive income tax and the "unfair" sales tax turn out to be fair in the end? I personally think that all parties come out satisfied to an extent in the end, which is the most appropriate scenario. It isn't appropriate for either party to be the only happy party in the end and I think that the government understands this full and well, which is why they combine different taxes in order to achieve "fairness."

-Dennis-

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2. There are people that argue that the progressive tax system will destroy incentive because people will not want to be rich if it comes along with higher taxes. The idea presented here is inaccurate, entrepreneurial spirit is still alive, so long as all incomes aren’t directly controlled by the government. Those with a higher income still have the opportunity to live very luxurious lifestyles.

3. The largest tax burden of a sales tax falls on the poor. A sales tax is inherently unfair because the poor have to pay the same amount as the rich who have much higher incomes. However, the rich pay a greater income tax than the poor, so in the end the government is just trying to achieve a balance in taxes by combining fairness and unfairness (just like the Senate and the House of Representatives). All states have the same amount of representatives in the Senate, but they have representatives based on population in the House. This is just the way that the United States government is set up to solve the fairness/unfairness conflict.

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