The above 1943 Donald Duck cartoon, The Spirit of ’43, was funded by the Department of the Treasury in 1943. It highlighted a major problem for the Federal government. Prior to World War II very few Americans paid any income tax and there was no withholding. With the increased taxes to pay for World War II, most full time non-agricultural American workers were going to be paying income tax and few were saving to pay the tax bill when it came due. →']);" class="more-link">Continue reading
One of my pet peeves has long been the fact that most people seem to have no idea how much they pay in taxes. The reason for this is obvious: many of the taxes we pay, by design, are hard to keep track of. In this category are sales taxes, utility taxes, taxes on gas, etc. (This does not include the taxes paid by corporations and other businesses (they do not pay taxes, they collect taxes) that are passed on in higher prices for the products and services that we purchase, or in the social security share of employees paid by employers that effectively reduce the wages that employers pay employees.) In the Wall Street Journal we find that the average worker has a tax rate of approximately 40 percent:
But tax rates are already high—much higher than is commonly understood—and increasing them will likely further depress the economy, especially by affecting the number of hours Americans work.
Taking into account all taxes on earnings and consumer spending—including federal, state and local income taxes, Social Security and Medicare payroll taxes, excise taxes, and state and local sales taxes—Edward Prescott has shown (especially in the Quarterly Review of the Federal Reserve Bank of Minneapolis, 2004) that the U.S. average marginal effective tax rate is around 40%. This means that if the average worker earns $100 from additional output, he will be able to consume only an additional $60.
Research by others (including Lee Ohanian, Andrea Raffo and Richard Rogerson in the Journal of Monetary Economics, 2008, and Edward Prescott in the American Economic Review, 2002) indicates that raising tax rates further will significantly reduce U.S. economic activity and by implication will increase tax revenues only a little. →']);" class="more-link">Continue reading
So much for the “patriotic millionaires” trotted out by the Democrats calling for higher taxes. The dirty little secret of course is that the truly mega rich have elaborate tax planning to avoid paying one thin dime more than they have to in regard to taxes. An increase in rates would have little impact on them. If they were truly patriotic they would be calling for some variant of a flat tax on all income with the elimination of all tax shelters. The poster child for this call by the very wealthy for higher taxes is Warren Buffet. Gee Warren, maybe you could start by having your company pay the billion the Feds say it owes. →']);" class="more-link">Continue reading
The inaptly named City of Brotherly Love is attempting to license bloggers. If bloggers make any money from their blogs, they will have to pay a $300.00 “business privilege tax” to obtain a business privilege license. (I rather like the Orwellian term “business privilege”, as if the right to buy and to sell was some sort of gift of the State.) Go here to read the details at the Philadelphia Citypaper.
Just how many things are wrong about this? Let us count the ways: →']);" class="more-link">Continue reading
A US Government Accountability Office (GAO) report has brought out an interesting mystery in regard to the federal funds given to Worse Than Murder, Inc, aka Planned Parenthood:
A new report from the U.S. Government Accountability Office (GAO) on federal tax money funneled into Planned Parenthood and similar organizations raises more questions than it answers about the nation’s largest abortion chain.
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We continue the test of our Catholic worldview on the subject of the role of the Political Community- drawing upon Chapter 8 in the authoritative Compendium of the Social Doctrine of the Church. We have looked at the Old Testament (#377-378) and Jesus’ interaction with political authorities #379) to see the development of doctrine relating to how we are to regard the political community. Now we turn to “The early Christian communities”.
Yesterday Americans rallied in hundreds of tea party protests against high government spending and taxation. In my state 3000 people turned out in Peoria alone. Good coverage of the tea parties is at Instapundit. Much more at Tea Party online HQ.
Elements of the mainstream media were openly contemptuous of the tea parties, perhaps one of the more obvious examples being here at Hot Air.