Letter to the Editor,
I began writing this series of Letters to the Editor on government reform in the Spring, when the editor asked the rhetorical question about government reform, “Does anyone have a better idea?”. In the 10-1-25 paper, the editor asked another question, “Why Not?”. The third of his “Why Not?” questions had to do with changing how the IRS collects taxes to follow more of a business style billing model. So, let’s get to the core of federal spending, the tax code.
Our leadership promotes spending agendas, then tries to figure out how to generate revenue through the tax code. I agree with the editor that our current system of smoke and mirrors, with the IRS already knowing our wages and deductions, dividends, interest, and capital gains income, etc. but asking us to figure this out, usually by paying someone or some internet service to crunch our numbers, is not efficient.
What came before?
We rebelled against the monarchy system (e.g. the royal family owns everything, grants the lords their share of the land to manage, who they keep us villagers and peasants employed… Downton Abbey was a romantic vision of how the lords cared for us masses). Socialism sounds utopian, until you realize that this is like tithing to the Anglican church in the 17th century, especially if your pew is upstairs where the slaves had benches that leaned forward to keep them from dozing off. Communism owns everything, but in reality is a Wizard of Oz world of brutal authoritarianism with a yellow brick road that ain’t golden.
Capitalism… what could go wrong?
When I go to the store, I have a spartan chart of stuff that I do not grow or make myself, while I see charts filled with stuff that would jack up my A1C and LDL levels to stroke levels. How do we figure out what our “bill” would be for our share of government spending, when our carts are filled to different levels of government services?
Our leaders considered some stuff in our carts “luxuries” (e.g. yachts) or “sins” (e.g. cigarettes or alcohol, maybe junk food soon if RFK Jr has influence), to which the tax code attaches sanctions in the form of taxes on those products.
Other items and activities our leaders consider desirable. They provide tax incentives to promote said items and activities.
For instance, on the federal 1040 form, the itemized deduction list encourages home ownership by deducting interest on home loans, caring for one’s health by deducting medical expenses, charitable giving by deducting contributions to organizations which have done the paperwork to qualify, being economically productive by deducting business and work expenses, etc. If someone has enough of those, they can write them off, rather than taking the “standard deduction” which assumes that we are doing a certain amount of those things. Tax incentives also give credit for the nuclear family concept by counting one’s dependents.
Steve Forbes, heir to Malcom Forbes’ media empire and wealth, ran for president in 1996 and 2000. One of his pitches was the “Flat Tax”. He promoted a 17% income tax across the board for minimum wage earners and billionaires. What many folks did not catch was that his plan would have eliminated all those tax deductions. Wealthy people have legal and accounting departments departments to figure how to protect their wealth from taxation. Thus, some of our billionaire leaders get away with paying only $750 in taxes, and we working folks pay thousands.
But, what Forbes was getting at is that whenever the government sanctions some activity and creates incentives for others, those leaders are making moral and economic decisions for us. We lose our freedom when government leaders and agencies start influencing what we want to do to earn income, how to spend it, and what to possess. Eliminate much of the tax code and we are all freer to do what we believe in.
I’m not finished with this, but I’ll leave this for another day. Why does the government want to use the tax code to encourage some activity and discourage other?
Oscar Larson
Baker, WV
