The other week, as I peddled a stationary bike at my favorite health club, I caught a portion of a (close captioned) town hall meeting with Treasury Secretary Timothy Geithner on CNBC. He addressed the administration/treasury’s efforts in easing the recession and unfreezing the credit markets. An initial observation: Mr. Geithner was speaking about policies favorable to “95% of working families,” parroting the administration’s line before (and after) the election, and I was struck that here was a bureaucrat speaking like a politician (per the “working families” instead of “citizens” or even “taxpayers”). Now, I understand Mr. Geithner isn’t technically a part of President Obama’s burgeoning “czardom,” as Geithner does hold a traditional cabinet position, but I think such language may underscore some of the criticism directed at the administration regarding czars (i.e., an objection to politicking under the auspices of federal authority, not to mention the etymology of the word “czar”– Caesar, one who wields unelected, imperial power. Um, isn’t the whole idea antithetical to the American system?). But this minor point is pure discursion.
What interested me more is what Mr. Geithner was saying related to taxes. In addition to asserting that we must never again fight two wars “without paying for them” (another political line, though he might have a point), he said that we can never give a big tax cut to the wealthy without paying for it. Several interesting points arise from his statement. First, I applaud him for appreciating that the government should take in what it gives out, or that government should only give out what it takes in. Such is simple financial prudence. Second, he is most likely not implying that we should cut government spending (since he has already identified himself as a politician of the left), but rather suggesting that we shouldn’t be cutting taxes, which I think is the wrong economic solution to the tax/spend equation. (Second and a halfly, does he think that we should raise taxes to erase the quadruple-record $1.7 trillion budget deficit?) Third, “tax cuts for the wealthy” is a completely disingenuous political appeal, because the wealthy are disproportionately and heavily taxed under our federal system. Any across the board tax cut will thus result in the wealthy receiving disproportionate benefit (i.e., more total dollars back in their pockets than people in lower brackets), because they pay more in taxes in the first place– all giving apparent justification to the misleading charge that any Republican tax cut is “for the rich,” who should be rather forced to pay their fair share.
This is such a tired political tact, because excuse me, the rich already pay their fair share. And then some. Remember, the top 1% of wage earners pay more in income taxes than the bottom 95%. The top 1% earn 22% of the income, while the bottom 95% earns 63%. Meanwhile, 47% will pay no federal income taxes at all.
How do we justify this disparity? Because the rich can “afford” it? I realize each additional dollar has diminishing value relative to the previous one (i.e., the difference between a reasonable standard of living and the lavish is not so great as the difference between poverty and a reasonable standard of living), but how does that warrant the government taking private property from one group of people, effectively giving it to another group, because the government thinks the first group doesn’t need it? That sounds like tyranny.
I know I’ve already written about the progressive tax system a couple times before here at the Discursionists. I realize there are much more pressing tragedies and injustices in this world than a disproportionately high tax burden on an unfavored political class. I appreciate that as Americans, we all have it very, very good in the grand scheme of things, which imposes on us some spiritual obligations. But justice is not inconsistent or contradictory, and is required in the small things and the large. Even if we don’t think the rich deserve anything they don’t already have (and maybe not even that), they are entitled to a consistently applied rule of law, just like everyone else. Basically, if justice per the law is truly blind, we should all bear a proportionally equitable burden. And all refrains to “tax the rich” is our national context is an advocation for subtle, perhaps even somewhat painless but maybe not less profound, injustice.
Am I wrong?