Showing posts with label taxes. Show all posts
Showing posts with label taxes. Show all posts

Friday, July 3, 2015

Our "Life is a Lottery" Culture

One of the things President Obama is famous for is dissing the successful as "life's lottery winners." This parallels his charge that successful businesses don't deserve the credit for their success, saying "You didn't build that." This is politically shrewd, because it taps into two basic weaknesses of human nature: envy and greed. His philosophy, and that of many liberals in generals, conveys the message that voters are justified in their envy of success and wealth. Voters are encouraged to demand income redistribution because the wealth of others was not earned.
Fairness doctrine dominates the ethos of liberals and lies at the heart of their increasingly successful efforts to punish success by government regulation and taxation policy. If success is due to circumstance and luck, then it is only fair to push for more equal outcomes in the efforts of people to succeed. Voters, perhaps now a majority of them, like the idea of leveling the playing field by taking from the successful and giving to those who have not succeeded.
At the other end of the spectrum, the lottery mentality offers an excuse for those whose lives are mostly marked by failures. Their problem is bad luck, or exploitation by the successful. This is another example of unfairness, perhaps even of the mendacity of those who have won life's lottery. No longer do we have to blame failure on bad choices and decisions or on laziness. Poverty or antisocial behavior can't be blamed on freely chosen actions. Those who fail can find scapegoats and blame them.
Politically, liberal politicians have found the guarantee of success: convince people they are victims and pledge to punish the perpetrators and restore fairness. As Jeff Bergner put it in his essay, "One cannot build a cult of victimhood on the soil of personal responsibility."
It is not just craven politicians who reject personal responsibility. Many brain scientists have arrived at the same conclusion from highly flawed experiments that seem to show that a person makes choices and decisions well before their claim of when they made them. This research has been interpreted to mean that the unconscious mind makes the decision and later that becomes known consciously. Thus, the decision cannot be made freely. It is driven unconsciously by our genes and past learning experiences.
Thus, scientists provide support for redistributionist and retributionist social policies, because life success is not based on merit. We now have defense lawyers arguing "diminished capacity" for criminal clients. We even have clerics who argue from original sin and predestination perspectives that we can't help our bad morals.
I am writing a book on "Making a Scientific Case for Free Will." So far, despite my track record of science-publishing success, no publisher will touch it. Has free will become politically incorrect?
So why try? If you succeed, you won't get credit. You will get diminished, perhaps even punished. If you fail, you won't get blame. In fact, you will get compensated. This is what life in America is coming to in this new age of "life's lottery."

Sources:

Source for quote: Bergner, Jeff. 2015. The fame of life. The Weekly Standard, June 29, p. 25-26.


Source for critique of free-will research: Klemm, W. R. 2010. Free will debates: simple experiments are not so simple. Advances in Cognitive Psychology. 6: (6) 47-65.

Monday, January 30, 2012

Blaming the Rich for Not Paying "Their Fair Share"

President Obama’s re-election campaign theme is to raise taxes on investment income to 30% for individuals and to 54.5% for corporations because he blames the rich for not paying “their fair share.” But this blame is misplaced and wrong at all levels of analysis.

First, the charge is not even true. Not only do the rich pay vastly more taxes than anybody else (the top 10% earners pay 70% of the federal tax revenue), but the rich pay the same rate as everybody else. Warren Buffet’s secretary pays 15% on investment income just as Buffet does. And he pays 30% on non-investment income, while she pays a lower rate because her income is lower and our tax system is “progressive.”

Second, middle-class wage earners commonly have investment income that they don’t pay any taxes on now, because the income is accruing tax deferred in pensions, 401 Ks and IRAs.

No matter rich or poor, investment income can be taxed three times, once on corporations before they distribute the income to their investors, again on the investors when they receive it, and yet again when investors pass on inheritance.

The President’s policy is especially unfair to retired people, most of whom rely on investment income and pensions that in turn rely on investment income.

Obama is unfair to corporations because the higher tax would diminish the capital they have for growth of their business and the number of workers they support. This is particularly onerous for start-up and small businesses which typically have a compelling need for capital. Since small businesses create most jobs, higher investment income tax kills jobs, which is yet another way it is unfair to individuals.

Obama is unfair to the government and the taxpayers as a whole, because economic data show that high investment income taxes actually yield less total tax revenue. In the face of such taxes, individuals invest less and thus starve business of capital for growth, and corporations move jobs overseas. So, in trying to punish the rich, the President would end up punishing everybody.

Finally, Obama is unfair to Congress and his fellow Democrats by beating up on them for a tax policy they have supported ever since 1978. As just explained, there are good reasons why both Democrats and Republicans have supported lower tax rates for investment income. Moreover, Obama is misleading the public into thinking that if re-elected he will get investment income tax rate raised to 30%. Not even the Democratic Senate will vote for that.

In short, President Obama doesn’t really care about being “fair.” This blame-game campaign theme is a cynical ploy to get unthinking voters to vote for him.