Big Dogs Weblog

Obama Will Screw The Wealthy

Jun 13, 2008 Political

I know the idea of screwing the wealthy appeals to many people though I personally don’t understand that mentality. With regard to Social Security and retirement, the idea always appeals to liberals. Social Security is a mechanism with which the government keeps people in poverty because the government controls the fund (which is a misnomer because there is no dedicated fund). The government gets less than a 1% return on the money in Social Security and yet they refuse to consider privatizing at least a portion of it. The presumptive nominee Barack Obama used the current stock market tumbles to stress the point that if retirement money had been tied up in the market people would be hurting right about now. The fact is, they still would have earned more than SS does and they would have the potential to earn unlimited amounts and to receive unlimited amounts in retirement. With SS, one is capped no matter how much income the person made in his lifetime.

Obama wants to increase the amount of Social Security taxes one pays if income is over $250,000. He also wants to raise the cap on the amount that is subject to SS deduction. Obama believes that it is unfair for people making under the cap amount to pay SS on 100% of their income while those who earn more than the cap don’t pay on the portion of income above it. This sounds fair but it is not. People who make a lot of money and who do not begin drawing benefits early are capped on how much they may receive. At about $150,000 the monthly benefit (for 2008) is $2381. It stays at this number regardless of how much money a person makes above the $150,000 so a person who makes $250,000 (or even a million dollars) still only gets $2381. If Obama wants to talk about fairness, how fair is it that they are capped on what they may receive when those who make below $150,000 will get a benefit based upon 100% of their earnings?

As far as privatizing Social Security goes, it is the only proper thing to do. As it stands right now, money is collected from workers and paid to those who are currently drawing benefits. Workers who die prior to retirement lose what they have paid in. Reduced benefits can be paid to spouses but this does not take away from the fact that when you pay it in you lose it, it is no longer yours and you cannot pass it on to your heirs as you could with money you put away in savings or in the stock market. Workers who put a portion of their SS deductions into a private account would make more money and be able to retire on more than $2381 a month. They would also be able to pass the money on to their heirs. The government does not like this because people who are financially independent do not depend on the government and have no need for more social programs. Politicians can’t scare old people for votes if those people are well off.

Obama is a Socialist who believes in redistribution of wealth. He talks about fairness but his ideas are no where near fair. Wealthy people pay almost all the taxes in this country and the liberals keep tapping them for more and more. It is not right and it should not be tolerated.

If only people in this country learned the value of saving and how they could take care of themselves we could all retire in better shape and without government intrusion. Unfortunately, people have come to rely on government for everything. Social Security to the elderly is like crack cocaine to a junkie. Once they get it they are so tied to it they will vote for anyone who promises to protect it.

If they had been able to invest in their youth they would not have an addiction to government.

Source:
WBAL (via AP)
Quick Benefits Calculator (SSA)

Tags: Obama, rich people, social security, socialism, taxes

Democrats Still Want to Tax the Rich

Dec 14, 2007 Political

The Democrats are looking for ways to raise taxes and their favorite target, as always, is the rich. The Democrats have this misguided idea that the rich should pay more because they make more. This is an idea based in lunacy and cultured in class warfare, something the Democrats are very good at. Assuming that all citizens receive the same benefits from government (which is not the case), why should the rich pay more for the same benefits? Why is it fair to make those who make more pay more?

Vin Suprynowicz wrote an excellent piece where he asks that very question. His piece is designed to disprove teacher’s complaints about his assertion that schools indoctrinate students but the analogies he uses are spot on.

Tell them that to defend our country, the Congress has decided we need a new fleet of aircraft carriers that will cost $500 per American. This is to be funded by an income tax which requires one multi-millionaire like Bill Gates to pay $2,500, five average Joes earning better that the national median paycheck to pay $500 apiece, and thus allows four guys whose incomes are way below average to pay nothing at all. Does this represent “everyone paying his fair share”?

The question posed in this scenario is how Democrats view our country. They believe it is absolutely fair to charge Gates more, five guys above the median the $500 and four guys nothing. This is how the progressive tax system works and it is what Democrats are suggesting each time they say they want to raise taxes on the rich. They want the rich to pay more, the above median folks to pay the actual cost and the poor to pay nothing at all.

The problems is, as pointed out by Suprynowicz, everyone in the country would benefit equally from the fleet of aircraft carriers. The fleet does not offer Bill Gates any more protection than the guy who did not have to pay anything at all because we all receive equal protection. As Suprynowicz also points out, our income tax system is run differently than the way we pay for other things:

We pay for most things this way, after all. If a bridge has a $1 toll, everyone pays a dollar – the toll-takers don’t demand more from the guy in the Mercedes and less from the poor fellow in the rattletrap.

Buying a can of beans at the store? No one contends it would be “fair” to charge the well-dressed lady many times the price marked on the can. We also pay for our highways this way – the excise tax on a gallon of gasoline is the same for Mr. Gates as it is for you or me, on the theory that all our cars wear down the pavement about the same.

My first reaction when I read this was that he has it right and it is so easy that anyone should understand it. My second was complete fear that some idiot in government would read it and figure it would be a good idea to charge for everything based on income. In any event, the fact is we do not have to pay for the goods and services we use based upon income levels so why is it fair to make those in higher income brackets pay more in taxes (as a percent, of course they will always pay more in actual dollars)?

The interesting thing here is that while we all receive the same benefit from the protection afforded by aircraft carriers or roads or food we do not receive the same or equal benefits from government. Remember I said assuming we all received the same benefit from government? Well the fact is those in the lower income brackets use far more in government services than those in the higher income brackets. The lower income folks actually receive more from the government than they pay in while those in the higher end receive less than they pay in. Some people pay nothing and receive a lot from the government. The lower three quintiles consume much more than the upper two even though the upper two pay for nearly all the costs of government.

If we wanted to have a fair tax system, those who make less should pay more because they consume more. No one is suggesting that and it certainly would not be reasonable to do so. What would be fair is for government to charge everyone the same rate on their income. We would all be paying equally for the supposed equal benefits of government.

Congress does not want this because they love to take our money and waste it. I have done better investing my money than they have with the money they take from me for Social Security. I know how to better handle my money than they do. Congress has abused the Alternative Minimum Tax and reaped billions of dollars they were not entitled to because they collected it in violation of the rules governing why the AMT was established. Now they are crying that to fix the AMT they need to raise taxes to offset the revenue loss.

The AMT was designed to make millionaires pay a minimum amount in taxes. For years, people who are by no means millionaires have been paying the AMT which means the government has been taking money that it was not entitled to. They should be refunding money to all the people who were forced to pay taxes as if they were millionaires.

In any event, the fact is Congress is incapable of spending money with any amount of responsibility. They have the IRS mob to enforce their extortion racket and they jail those who do not pay taxes to deter the rest of us from deciding not to pay. We need to get rid of all of them and start fresh.

Congress needs an enema.

Source of Vin Suprynowicz’s article:
Indoctrination? What Indoctrination?
Source of Democrat’s Tax the rich

Tags: Democrats, fiscal irresponsibility, rich people, taxes