Tuesday, February 16, 2010

Is Taxation With Representation Really That Much Better?

How much of your income did you give to government last year? Think about it. If you are like most people you paid federal taxes. You likely also paid state sales tax and possibly state income tax. Some cities have a city income tax. Some people even pay borough taxes. If you are a home owner you also paid property taxes.

This sounds like a lot, but it's really just the beginning. Take a look at your regular monthly bills. I did. My last electric bill included $18.27 of taxes. This doesn't sound bad, but compared to the $193.75 of charges for electric service this amounts to 9.4% taxes. My cell phone bill, 14.3% tax. My home phone bill, 45.6% taxes and other government fees. About $0.55 for each gallon of gas we purchase goes to the government. Currently, this is the equivalent of about 21.5% tax. All these taxes on top of federal income taxes!

We give money to the government in other ways as well. When we register a car, we have to pay the government. If we want to fish, we have to pay the government for the privilege of a fishing license. When we drive on a toll road, we pay the government. There is almost nothing we do involving money that does not require us to pay one government agency or another.

Homeowner associations are quasi governments. Anyone who lives in one must pay the association either monthly, quarterly, or annually. Homeowner associations have the power to impose special assessments and to foreclose on property if homeowners don't pay their share of fees.

There are heavy taxes on such items as cigarettes and alcohol. The theory is that these heavy taxes act as a deterrent to limit smoking and drinking. However, there does not seem to be much evidence that increasing taxes on legal stimulants actually leads to decreased consumption.

In 1773, three years before the signing of the Declaration of Independence,colonists in Boston, MA, expressed their outrage at the passage of the Tea Act by the British Parliament. Their main objection was that the Tea Act was passed by Parliament in Britain, not by officials elected by colonists in Massachusetts. Ultimately, the Boston Tea Party is credited as the event that began the revolution which led to the establishment of the United States of America.

Imagine what the colonists would think now! What have we allowed to happen to the country they fought to create? It is almost certain this is not what they envisioned when they were throwing crates of tea in to Boston Harbor, risking their freedom and risking their lives for what they believed to be a fundamental right.

Does representative taxation mean that it is OK for law makers to pass tax after tax and allow bureaucracies to impose "fees" and "surcharges" that, since they are not called taxes, they can impose without an act of Congress? If the colonists were able to look in to the future and see the state of the union today with respect to taxes, would they even bother? Would the Revolution have even taken place?

Why do we allow ourselves to be taxed so much and in so many different ways? This is not to say that taxes are not necessary. Taxes are absolutely necessary. Tax revenues fund our military which helps to keep us free from any attempts from outsiders to take control of our land and resources. Taxes pay for road building and maintenance. Taxes also pay for police and fire rescue as well as libraries and parks. However, taxes (including all fees, surcharges, etc. collected by government agencies) do not have to be such a big part of our lives.

Government in the United States, at all levels, has gotten too big. We need to take a good hard look at everything our tax money, fees, surcharges, whatever name is given to money collected by government, is used for and decide if we really need it. Once we do this, we can say to the colonists, "Thank you for your efforts, your sacrifices. We are doing everything we can to uphold everything you worked for."

4 Comments:

At 10:19 AM , Anonymous Anonymous said...

while I agree with most of what you say, your view on specific taxes in general is a bit skewed. Consider the fishing tax that one must pay should they want to fish (legally.)Believe it or not, the government actually does things with your license tax, and you reap the benefits, whether you know it or not. Where Im from, our large lake used to be one of the top crappie fishing spots in the US, until homes were built around it and pollution decimated the aquatic population. Those taxes from the fishing licenses funded a govnt program to restock the lake, clean the lake up, and return it to a condition better than what would have been. Given your attitude on taxes, I think even Robert Nozick would label you more towards an anarchist than a true libertarian.

 
At 5:46 PM , Blogger Jim Duffy said...

Anonymous - thank you for your comments. Please understand, I am not implying that we need to scrap every tax, fee, surcharge, etc. Simply that we need to take a good look at each and decide if they are truly needed. The clean up job you wrote about is great! I would not consider this wasteful.

Although I would not label myself an anarchist, or even a Libertarian, I have been called worse.

 
At 8:12 PM , Blogger Walter said...

Hi Jim! Nice post. I for one would prefer less taxation and more responsibility taken with the taxes that absolutely must be collected like you stated. Here is some additional food for thought. Do the same kind of analysis on hours of your life and realize how much time is consumed by others such as your employers if you are not self employed and you will be amazed of the pathetic skeleton that you get to ordain according to your own will. Ever since I started thinking about it I have totally redesigned my life and my thinking to maximize my life how I want it not how society or someone else wants it. If you live an average of lets say a lucky 100 years; years 0-18 are not fully under your control, 19-22 totally under your control but your too ignorant to live them up and you can't afford to anyways, then you give years 23-65 to your employers, retire at 66 when your not a worth a shit anyways, have a bad back, angina and arthritis, then you finally have roughly 34 years of pain and poor health until you have to require assisted living and finally die. Your best stretch you gave to your employers and you might think well at least I had vacations but if you do a similar study on your typical year you find that you give away your best hours to your employer, your best thinking to your employers, and then you wonder why you do this? You work your ass off to make a skeleton of a living compared to what you actually achieve in production for someone else, then the government takes it chunk and your employer takes the other chuck, your family take a huge chunk and when you look at what you get you might realize why you're so damn tired. Actually Im not complaining because having realized this I have made some wonderful changes but you have to see this overview before you get the fire to make you change.

 
At 6:49 AM , Blogger Jim Duffy said...

Walter - thanks for your comments. I have had these same thoughts many times. Most recently when I spent a couple days in the hospital.

It is very eye opening to really open up your mind and think about how little time you spend doing things for yourself and, for that matter, your family if you are not a stay at home parent.

I work an average of 53 hours a week, down from 70-75 when I was single. I get home around 7pm. This does not allow much time for family before it is time for the kids to go to bed.

The trouble with spending less time working and more time enjoying life is a lack of cash flow. As soon as I figure out how to live without money I will live a more enjoyable life - probably in Fiji or the Bahamas.

 

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