Joel Schwartz Schwartz abhors what you have to
say but will fight for your right to say it. E-mail him at
[email protected].
It is a tragic day in America when we have to learn lessons in
fairness, capitalism and good policy from the former head of the
communist KGB, Vladimir Putin. But his tax system has proven to be
better than America?s, which robs the hardest working members of
society and destroys economic incentive.
The liberals avert tax reform by whimpering about tax breaks for
the rich and claiming that reforming our progressive (communist)
tax system will lead to governmental and societal breakdown. But we
must learn from countries like Estonia, Latvia, Lithuania, Russia
and Hong Kong, which have all escaped economic demise by enacting
flat taxes.
Virtually all economists agree that a flat tax is best for
economies, and this has been substantiated by a Wall Street Journal
study that found, on average, countries with a flat tax grow
economically over two times faster than countries with progressive
tax systems.
A primary complaint from the left is that creating a fair tax
system will subvert important funds from our ?efficient? government
and burden the poor. However, Dr. Alan Auerbach, a professor of
economics at the University of California, Berkeley, former chief
economist at the Joint Committee on Taxation, and a Democrat,
estimates a 5.7 percent increase in the American economy and an
average increase of $3,000 in income for the typical family of four
resulting from a 17 percent flat tax. Russia has proven this trend
as their tax revenue for the year 2001 actually increased by 28
percent along with increased economic growth.
The reason for this is when people do not feel like they are
being cheated out of a substantial part of their income, they have
the incentive to work harder and generate more income, and hence
more tax revenue.
Much of our indoctrinated populous doesn?t even realize that the
idea of an income tax is patently un-American. Congress was
expressly forbidden by the Constitution to tax incomes until 1862
when a 3 percent ?temporary? tax was placed to fund the Civil War.
This tax was later deemed unconstitutional by the Supreme Court and
Congress was forced to pass the 16th Amendment which legalized
income taxes.
However, we are stuck with it and must learn more equitable and
efficient methods of taxation that do not infringe on the
individual?s right to property. Presently, we have a 45,000 page
tax book that continually gets larger and more complicated to the
point where the bureaucracy that has been created to implement such
laws cannot even understand them. Last year, internal audits found
that the IRS hotline gave out erroneous advice at least 30 percent
of the time.
Imagine for one second if your own doctor gave you incorrect
advice half of the time. You?d be dead and the doctor would lose
his license. Fortunately, in the privatized industry we have the
choice to choose a more efficient solution. But currently, we are
stuck with one ever-growing failure of a tax system that is never
held accountable for its mistakes.
By solely eliminating the IRS (as the passage of a flat tax
would enable), we would already be saving millions of dollars that
are funneled into a massive bureaucracy that is wholly incompetent.
Furthermore, with a simple and economical flat tax, we omit the
need for tax lawyers and accountants. When people do not have to
pay thousands of dollars to lawyers and professionals to debug the
jargon of our tax laws, they will be far less likely to try to
sneak around tax laws and fabricate deductibles.
Because only the rich can afford these lawyers and accountants,
they often get away with paying only a part of their taxes while
the poor and middle class usually end up overpaying their taxes out
of fear of an audit. A flat tax would remove this gap, creating a
more equitable system as well as generating far more tax
revenue.
Even worse, an unfair tax system that attempts to overburden the
rich, leads to the flight of capital as businesses remove their
assets from the United States and bring taxable income to other
countries. As a result, jobs that might have been created for
struggling American citizens are given to foreigners. So once again
the ?I feel your pain? liberals fill their own elitist pockets by
perpetuating bureaucracy and destroying business at the expense of
those who they claim to represent.
But as long as the taxation lawyers keep filling the pockets of
the Democratic Party, the Republicans remain spineless, and our
populace allows more and more of its fundamental rights to be
snatched by bureaucrats, don?t expect any type of sensible tax
reform. The politicians need to stay in business too, don?t
they?