A case for higher taxes?

[allhatnocattle.livejournal.com]

*inspired by a question from patriotress, a Tea Party type gal who wants her taxes lowered



In principle I am against low taxes. Not that I like paying them. A full third is missing off my pay every month, and it grows to nearly 40% after including sales tax on purchases (9 outta 10 provinces have a provincial sales tax as well as the federal one, Alberta is the exception).

Taxes pay for the services we all enjoy and need. They are a necessary evil. Lower taxes means that the nation either has to cut services or go into debt. Americans seem perfectly happy to not have socialized healthcare and to drive on shitty roads. I like nice roads, nice schools, etc.

What we're really talking about is value. I get the feeling the frustration in the Tea Party is they are not seeing much bang for their bucks. They hear about a lot of waste. So by lowering taxes they force government to streamline, eliminating the bullshit and get down to the basic function of government, governing. And not be in the business of providing services they seem so bad at delivering. As they say, they want small government.

I think if they saw value for their tax dollars they might change their tune. If FEMA showed up in NewOrleans during Katrina and saved people right away there's value in that. There's no value in responding to a natural disaster later the foreign NGO's and instead of saving people, they make the priority in shooting looters.

Ikea or Walmart furniture is priced right but so is the quality. Usually you end up buying a new futon every few year because it simply doesn't last. Where if you save up and spend a few thousand bucks on a decent sofa you'll have it for life. I don't mind paying more to have quality. I don't like saving a few bucks to get crap. Of course quality isn't always affordable and a large price tag is never a real guarantee of anything.

And it's the same with taxes... to a point. More taxes paid out should translate into better quality government services. Whether it's services we personally use every day (public roads) or emergency services (police, fire) or services that are not used personally (National Defense, trade negotiations). I would rather pay more to ensure better quality then pay less and put up with crap.

Of course by no means is this any guarantee of quality. There isn't a direct correlating relationship. Just as you can pay a lot of money for a Lexus that rolls over and doesn't stop, you can pay a scant fraction for a 1988 Dodge Diplomat that is totally awesome.

Tax revenue is often wasted on crap. We've all heard stories about the government buying $1000 hammers. Some of the crap is alright, depending on your perspective. Like the latest greatest nuke, as if we need a better nuke.

Private industry perhaps has a better track record for not wasting money. The problems of the recession can be blamed on big companies spending money on stupidity. I mean if I was a bank issuing loans, I might want to make sure the borrowers have the means to pay them back. If I ran a car company, I might not give a project manager a bonus for a car that doesn't work (looking at you, Lexus).

Waste is still waste, private or public. Private industry going into debt usually closes up shop under debt of bankruptcy. Where a government service is often propped up in a way so they can continue to provide services no matter the bottom line, able to deal with the debt in ways unavailable to private industry. This lends itself better for the consumer.

Healthcare is a hot button issue. In Canada we've been slowly moving towards more privatization. I listen to the proposals touting that private company can provide medical services cheaper and with greater competition even cheaper still. However I've never heard of medical services in USA having price wars or going on sale. Maybe without the government bureaucracy the private service will be cheaper, but I see no valid evidence of that. Government does streamline health services for better efficiency all the time. I would rather just have my taxes kept high and deal with the government.

Lowering taxes is an alright principle in the abstract. As I think I said before, I think the idea is to force greater efficiency and eliminate waste. But it seems to me lowering taxes guarantees the value per tax has to decrease as well. Without the revenue quality of services need to be cut, or services eliminated altogether. So which service to you relax on or eliminate? The DEA? How about getting rid of all those pesky anti-counterfeiting measures? Do you really need a chip in your passport? Or the 200 military bases?

Again it's a matter of value. Americans seem really proud of having the biggest, best, baddest military in the world. They can see the value of their tax money in this achievement. Just as Canadians see the real value in paying our taxes through having socialized healthcare. We all like value.

Comments

[mrbogey.livejournal.com]

'Taxes pay for the services we all enjoy and need. They are a necessary evil. Lower taxes means that the nation either has to cut services or go into debt. Americans seem perfectly happy to not have socialized healthcare and to drive on shitty roads. I like nice roads, nice schools, etc.'


The bulk of the federal budget, after defense spending, isn't spent on those things.

[allhatnocattle.livejournal.com]

I'm talking about taxes. I don't think I specified federal or state or provincial or local taxes.

Do Tea Party only want Federal taxes lowered? They're ok with state or local taxes?

[caerfrli.livejournal.com]

I agree that people like us (in the top bracket) don't pay enough taxes but I also think fraud and waste will always be with us to some extent. Chances are cutting back on government's income will only affect government services. The amount stolen will probably remain the same.

[allhatnocattle.livejournal.com]

agreed

[chessdev.livejournal.com]

I tend to agree with you here.

[lovefromgirl.livejournal.com]

Americans seem perfectly happy to not have socialized healthcare and to drive on shitty roads.

Not this American! I'd rather be taxed all to hell and get, as you've said, bang for my buck.

Neither am I particularly proud to be from an enormous, warlike, undereducated country with a vicious class divide. I don't see where my tax money is better spent on the military.

I agree with your second-to-last paragraph, but please tone down the snootiness. You're not better than I am because you were born over the border.

[allhatnocattle.livejournal.com]

I think the last paragraph is far more snooty. Really I make conscious effort to restrain my snootiness.

While I'm 100% serious about this, I know I shouldn't be such a pride-filled Canadian. There's a lot of things around here that need fixing. USA does a lot of things better then Canada, I just can't think of any. Nor can I think of any other place I'd rather be. Maybe a Caribbean topless beach.

[fizzyland.livejournal.com]

Neither am I particularly proud to be from an enormous, warlike, undereducated country with a vicious class divide. I don't see where my tax money is better spent on the military.

Agreed. I can't shake the overwhelming feeling that regards of party, my priorities are ignored by business as usual in Washington.

[sealwhiskers.livejournal.com]

I remember when I first got my hands on the libertarian Taxpayer's bill of rights (TABOR) in Colorado. I investigated it along with some clients for a project, and I was shocked at how services and education stats in CO had dropped from the top 15 to the bottom 20 states before and after TABOR came to be. The more I checked the more I understood that if you want broad quality, tax cutting is never going to be the way. I can't fault anyone for wanting to affect the system when it comes to what they want gov. to spent on, but that's a different issue. A reasonably sized government apparatus is key to quality, as is transparency, voting and debate.

[ddstory.livejournal.com]

This is truly interesting.

Now... how about a tax lj cut?

[dukexmachismo.livejournal.com]

lj-cuts only benefit the rich.

[allhatnocattle.livejournal.com]

Are you serious? I always hate these lj-cut requests. Can I ask why? I mean I understand it makes scrolling through friends page a bit of a pain, but what's a tenth of a second? I mean how do you manage surfing the web?

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[badlydrawnjeff.livejournal.com]

Taxes pay for the services we all enjoy and need. They are a necessary evil. Lower taxes means that the nation either has to cut services or go into debt. Americans seem perfectly happy to not have socialized healthcare and to drive on shitty roads. I like nice roads, nice schools, etc.

The federalism argument was made above. Top-down control simply doesn't work.

If FEMA showed up in NewOrleans during Katrina and saved people right away there's value in that.

They did (http://www.popularmechanics.com/science/environment/2315076):

Bumbling by top disaster-management officials fueled a perception of general inaction, one that was compounded by impassioned news anchors. In fact, the response to Hurricane Katrina was by far the largest--and fastest-rescue effort in U.S. history, with nearly 100,000 emergency personnel arriving on the scene within three days of the storm's landfall.

Part of having a "strong" central government and high taxes is the misguided expectation that the "strong" central government is capable of being a proactive first responder, when the reality is that the best it can ever do in situations such as Katrina is be a secondary responder and react to what's needed. The strong central government we have did not respond the way you'd expect, and instead of recognizing the reality of the situation, you think it has to do with low taxes and low value for the dollar?

Ikea or Walmart furniture is priced right but so is the quality.

I can't speak to Ikea (although the bookcases I have from them have been excellent), but Wal-Mart offers good products at low prices. This perception makes no sense, because they're not selling anything special - just the same products you can get in other places at a lower price.

If anything, Wal-Mart, Target, et al should be a model of efficiency regarding how a government should work in terms of cost/benefit. There's no reason why, for instance, federal workers should be paid so much more than their private counterparts (http://www.usatoday.com/news/nation/2010-03-04-federal-pay_N.htm).

I don't mind paying more to have quality.

More reason to push for more localized control - if you want to pay more, go someplace with like-minded people.

More taxes paid out should translate into better quality government services.

Duh.

Whether it's services we personally use every day (public roads) or emergency services (police, fire) or services that are not used personally (National Defense, trade negotiations). I would rather pay more to ensure better quality then pay less and put up with crap.

Instead, we pay more and put up with crap. And then the answer from the powers that be is that we're not paying enough, and that's why we have crap. It doesn't occur to them that the crap may be from the structure, not the available money.

Of course by no means is this any guarantee of quality. There isn't a direct correlating relationship. Just as you can pay a lot of money for a Lexus that rolls over and doesn't stop, you can pay a scant fraction for a 1988 Dodge Diplomat that is totally awesome.

With this line, you completely nuked the point of this post. I hope you noticed that.

You forgot half the argument.

[squidb0i.livejournal.com]

"Top-down control simply doesn't work..".. in every situation. Use the right tool for each job, with preference to decentralization where possible.

regarding FEMA's response to Katrina

[allhatnocattle.livejournal.com]

The one thing USA really excels at is marketing. America ideas are not just thought up, they are manufactured, packaged, delivered and sold. Now it is a complete failure of American marketing if FEMA showed up. Yes, we know 100,000 first responders were on scene in NewOrleans within 3 days including military, NGO's and foreigners. Your link says, "ONE OF THE BIGGEST reminders from Katrina is that FEMA is not a first responder." There was this huge misconception that that was exactly what FEMA's role was supposed to be. Either the marketing of FEMA lied, or they did a poor job representing what FEMA's role was supposed to be.

OK, so let's get back to value. The perceived value in having FEMA is they were there at the ready in case of emergency. This is why American tax money goes to them. It's not a huge expectation to have a team at the ready able to fly out responding to emergencies in less then 12hr.

Now there's no real value in FEMA until FEMA shows up at the emergency. I mean it might be awesome that FEMA might have been working behind the scenes organizing, but that seems like tax money better spent elsewhere. They should have been prepared. I mean the weathermen predicted days before that hurricane was going to make landfall somewhere.

There is huge perceived value in actually seeing FEMA boots on the ground in action. Citizens see that and their money is well spent. You don't see that and it's been wasted. Perception is everything.

regarding Walmart crap

[allhatnocattle.livejournal.com]

Absolutely not the same quality. A pressboard dresser from Walmart is not the same as a solid oak dresser from Ethen Allen. I'm a plumber so I know tools. A cheap Made in China screwdriver from Walmart is not the same as a screwdriver from KleinTools. The comparisons are endless. Walmart sells crap. It's great if you are on limited budget or understand Walmart goods are essentially disposable. But I need a screwdriver with shatter proof handle and shaft that won't bend. Again it's a matter of value.

On nuking the point of the post

[allhatnocattle.livejournal.com]

it's not suicide of opinion to admit there are exceptions to every rule.

One can pay a lot for "supposed" quality and still not receive it. But if you pay too little you are absolutely guaranteeing that you're getting crap. I mean you can't possibly afford quality.

But what I really wanted to focus on wasn't quality, but value. Of course the two are inter-related and do overlap.

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[badlydrawnjeff.livejournal.com]

Private industry perhaps has a better track record for not wasting money.

It's not perhaps. Private industry must refrain from waste, or that private industry fails.

The problems of the recession can be blamed on big companies spending money on stupidity.

No, it can't. The problems of the recession can be blamed on too much centralized pressure.

I mean if I was a bank issuing loans, I might want to make sure the borrowers have the means to pay them back.

Good thing we weren't, you know, incentivizing people to give loans to otherwise-unworthy applicants.

If I ran a car company, I might not give a project manager a bonus for a car that doesn't work (looking at you, Lexus).

Contracts are contracts. Bad analogy.

However I've never heard of medical services in USA having price wars or going on sale. Maybe without the government bureaucracy the private service will be cheaper, but I see no valid evidence of that.

We can't have price wars here because the rules are so centralized. We don't have a real market in medicine, so we're kind of screwed there. But yes, remove a lot of the bureaucracy and it would be cheaper, no doubt whatsoever. Need valid evidence? Look at the public v. private costs above. Look how well private industry works in terms of efficiency.

Government does streamline health services for better efficiency all the time. I would rather just have my taxes kept high and deal with the government.

Goverment has shown no streamlining ability. And you'd rather deal with the government? Really? What if the only store you could shop at was Wal-Mart? The only restaurant you could eat at was Burger King. The only clothes available were from Old Navy? Part of efficiency and cost-savings is competition and choice. We lack a lot of that in medicine in the US, but it's still better than the alternatives. We could improve medicine significantly by reintroducing that competitive spirit.

But it seems to me lowering taxes guarantees the value per tax has to decrease as well.

Does it? Lowering money to a government organization might require them to streamline operations and do more with less. You know, like every business has had to do in the last couple years. Like how manufacturing exports and productivity is great in the US even as manufacturing jobs disappear.

So which service to you relax on or eliminate? The DEA? How about getting rid of all those pesky anti-counterfeiting measures? Do you really need a chip in your passport? Or the 200 military bases?

Now you're thinking like a conservative. Welcome to why I believe what I believe.

Again it's a matter of value. Americans seem really proud of having the biggest, best, baddest military in the world. They can see the value of their tax money in this achievement. Just as Canadians see the real value in paying our taxes through having socialized healthcare. We all like value.

The difference is that the Canadians don't know any better while the Americans don't have much of a choice, given that we tend to be world police.

Good thing we weren't, you know, incentivizing people to give loans to otherwise-unworthy applicants

[squidb0i.livejournal.com]

Or, you know, incentivizing companies to take massive risks in pursuit of profit by removing decades old legislation that prevented them from, say, consolidating into inefficiently regulated cross-function financial giants? Giants that then, for one example, opaquely securitized said loans and sold the resutling fraudulent assets to unsuspecting clients (including police, teacher, etc pension funds and municipalities). Giants that then took out colossal insurance policies on those doomed securities from an insurance giant also deemed too big to fail, thereby guaranteeing that when they did (as designed) that the resulting bail out would go directly from taxpayers wallets into said companies pockets.

'Cuz that would be crazy..

Re: 2 of 2

[allhatnocattle.livejournal.com]

Thank you for the huge reply. That's awesome. Too bad you can't hide it behind a cut, lol.

I have so much to say on what you've written here, but chores calling. I'll reply later.

Re: 2 of 2

[buggerthis22.livejournal.com]

"The difference is that the Canadians don't know any better while the Americans don't have much of a choice, given that we tend to be world police."

Just curious... why are we the world police??? Sometimes I feel like we butt in where we don't belong.

I'm sorry, but hearing that the government is funding a project to make a jet that can fly itself... well that kinda makes me feel like my tax dollars are going to jack shit. I don't like the funding that goes to the military. I feel it's a little excessive. I'm sorry if I don't believe we need a jet that flies itself. If we're spending money on that sort of stuff, just work on improving what we have! We have plenty of pilots capable of flying our jets. We don't need robots right now. There are more important issues to worry about than that. Maybe it creates jobs, but for who?? For people who have a degree in advanced robotic science or some crap. That's not really making jobs for the rest of the nation. In fact, I think it would be safe to say (if they are sucessful) it would actually cut back military jobs since we won't need pilots if it can fly itself.

On the other hand, funding projects like improving/making new roads creates jobs for the average joe. I think we should be focusing our taxes on projects like that. Our country is in desperate need of jobs that are accessible to the middle-class. I think we need to rethink our position on butting into everyone's freaking business. Think about the amount of homeless and starving people living on our own soil that we do nothing about. Yet when Haiti has an earthquake, we raise like six million dollars to help them. Now, don't get me wrong, I think it's great that we're trying to reach out to others in their time of need, but there comes a point where a country should reach out to its own people. The last time we did something huge to help our own people was during 9-11 and Katrina. I'm happy paying taxes when it helps our people.

Re: 2 of 2

[tridus.livejournal.com]

It's not perhaps. Private industry must refrain from waste, or that private industry fails.

Yeah, right. Private industry wastes gobs of money, and the bigger the company the more they waste. This only holds true for companies in real competitive markets with strong price pressure.

The difference is that the Canadians don't know any better while the Americans don't have much of a choice, given that we tend to be world police.

Yeah, all that money bombing Iraq was definitely money much better spent then on something like those clueless Canadians might spend it on. I mean, doctors for the poor? Pfft. That's completely useless when there's places completely uninvolved with Al Qaeda to blow up!

On healthcare

[allhatnocattle.livejournal.com]

Why do you think Canadians lack choice in healthcare? If I don't like my Harvard trained doctor I can always change doctors to somebody trained at McMaster University. If I don't like clinic or hospital I can go to any other clinic or hospital. Socialized healthcare provides more choice then American free enterprise does! I'm not stifled by trying to find a doctor/hospital that accepts my particular insurance plan, or limited to only docs trained in the Caribbean.

Free enterprise healthcare isn't about competition keeping prices down. No trade really discounts their services. No doctors or architects or plumbers. They might at first to build up client base, but it's pretty standard that the rate is the rate.

Socialized medicine keeps costs down by not only having a monopoly, but the greatest possible client base of 100% of the population. It's every corporation's wet dream. Having 4 insurance companies competing for your business means that none of them have 100% of the population as their client base.

Yes they streamline. They have to. Of course because cash flow limitations, but also because of campaign promises. I seem to recall Obama and McCain both making similar promises of eliminating "pork" (as Americans say).

Re: 2 of 2

[allhatnocattle.livejournal.com]

Private Industry can be just as wasteful and still get by. See Fannie, Freddy, Goldma, AIG, Behrs-Stein, GMC... of course this has been an exceptional few years. So look at Harley Davidson, Cushman, Triumph, Indian, and a slew of other motorcycle companies still in business today in one form or another. Survival of the fittest, eh? Each and every one has has some sort of government bail-out over the years ( most famously Reagan's 45% import tarriff on bikes over 700cc greatly assisted American bike builders)

Oh, you can say it wasn't waste that got these companies in trouble. It was failure to adapt and innovate. It was changing markets. Whatever. All of these are in fact wasteful practices. I mean they made products that didn't sell, or didn't work, or didn't turn a profit. These are perhaps as wasteful as any government project that don't work.

Maybe not. As Tridus points out, there are built in interfere efficiencies to gov't business. I know at least our respective gov'ts both strive to shed the extra weight of inefficiency. Review Obama's and McCain's and even Canadian campaign promises.

There is one good tax

[tcpip.livejournal.com]

I keep pointing people in this direction. I just hope that people will understand it one day.

http://en.wikipedia.org/wiki/Land_Value_Tax
http://taxreform.com.au/

"The single tax is so simple, so fundamental, and so easy to carry into effect that I have no doubt that it will be about the last land reform the world will ever get."

- Clarence Darrow