In January of 2015 I started an intermittent series to outline the characteristics of a politician for whom I would love to vote. The first blog post talked about how I would like to see a politician view our military engagement. Most politicians for whom I vote, I vote for somewhat begrudgingly knowing that there are many attributes of him/her that I truly do not appreciate. I often times have to choose the lesser of two (or three, or four) evils. So I will describe what kind of character and political stances that I would appreciate my close-to-perfect candidate to possess. I obviously cannot address all political stances in one single post, so I will break this up into several posts. I would love to hear your comments on each characteristic, but please save your comments on unrelated characteristics until they appear.
Politics can be a tricky thing. I believe that we have a several reasons for the stalemates that we have. One reason is the language we use, another is an unwillingness to speak to both sides and to truly try to understand the other side, and another is an unwillingness to compromise. I try to clarify language, speak to both sides, and reveal compromise in this post. I am sure it will not bring 100% agreement, but I do believe it will bring people closer together and make future discussions more profitable.
Higher Income Taxes
This blog post is inspired by a Facebook post that I made and the subsequent comments. The political stance will be taxes, but that subject is too broad for one post, so I will narrow it down to taxes on the very rich for one specific purpose.
I honestly believe that a lot of the disagreement over taxation of the very rich is one that could be remedied if only we were to change our language when speaking about taxes, and change the way we use taxes. A number of people may agree with the principle behind an idea, but cannot agree with how it is being presented. And there are a number of people who simply cannot trust the American federal government with money. Knowing those stumbling blocks, I believe there is a way to avoid them.
I am going to first copy my Facebook post and then address some of the concerns raised by commenters. Here is my post (with some small edits from the original):
Let me give you an insight to my mind. I struggle with a number of thoughts. I am in favor of the very rich paying proportionally higher taxes to everyone else. However, I am not in favor of the rhetoric used to support such tax hikes. For instance, when I hear someone say, “We want them to pay their fair share”, I get irritated because by all statistics they pay more than their fair share. I do not support the unjustified condemning of one group for the sake of another group. I cannot support any form of greed, no matter if it is coming from the rich or the poor.
I could get behind a candidate if they said something along the lines of, “We admit that we are going to unfairly take more from the very rich because we, and even they, recognize that they can afford higher taxes. We are then going to directly use these taxes to help the people on the lower ends of society. Not a single dime of these taxes will go to politicians, or any political spending at all. The revenue will go directly to help the lowest in society.”
One reason government exists is to protect the lowest in society. The very rich have a right to their money. The poor does not have a right to the very rich’s money. However, government exists to make sure that the very poor are not forgotten and to help them. In our Constitution the American government has a right to tax for the benefit of our country. Since the very rich have already benefited from the country, I have no problem with government stepping in and doing their job.
This is not the same as wealth redistribution. This is basically charity for the poor. Of course I would also put in place some measures that makes sure the people who would be benefiting from this taxation would not be people who simply expect others to provide for their lives.
As you can imagine, I received many responses to this. Some people loved it, others not so much. What I would like to do here is help point out a few things that I believe will bring more agreement on this issue and hopefully instruct our politicians how they need to speak and act in order to attract more people from the other side of the aisle to support their cause. I admit that this blog post will not cover all responses, but I think it will be a good start. I also admit that I may be very ignorant as to what is already out there. I know that some of what I speak about below is already out there to some degree, but I do not know all the specifics.
Since this was originally a Facebook post and not intended to be a comprehensive paper on America’s tax code, there were some obvious questions that came up when people read my post. I completely admit that I did not concern myself with all possible objections when I first penned the post. So to help move this conversation along I will start by defining a few things better.
First, when I said the very rich, I did not have any specific income amount in mind, but let us for argument’s sake say the top 1% of American earners. In order to be in the top 1% your household has to make $450,000 in a year. Currently there area bout 1,170,000 households in the top 1%.
Second, I did not say how much the very rich should be taxed. Again, I did not have any specific number in mind, but let us just start with 2-3% of pre-deductible income of any variety (e.g., wage, dividend …). If we allowed a 2% tax on the top 1% of households, at 1.17 M households, that would yield at the absolute very least $10,530,000,000. And that is assuming that all these households only make $450,000/yr. But really we know that many of these households make far more than that. What that actual number is is beyond the scope of this blog. If someone were to find that, I would be very grateful.
If we allowed a 3% tax, it would yield $15,795,000,000 with again assuming only $450,000/yr income. That is a lot of money being flooded into helping the very poor. 2-3% is a very low number. If your household brings in $450,000/yr, 2% is only $9,000, and 3% is only $13,500. I know that if I made that much money, I would not have a problem with a tax that went directly to the poor.
Third, I did not say who the very poor was. Again, I did not have any specific number in mind, but let us just start with households that are below the poverty level.
As you read, I believe that the language that the very wealthy need to pay their fair share is a huge stumbling block to certain people. By almost every statistic, the very wealthy pay more than their fair share. This language only makes certain people less inclined to support the cause of requiring the very wealthy to pay a higher percentage on their taxes.
As I said, if a politician were to just be honest and admit that we are requiring the very wealthy to pay more than their fair share, then I believe that certain people would be more inclined to respect the honesty and accuracy of that statement.
Personally, this is a huge stumbling block for me when it comes to supporting a politician’s stance that the very wealthy ought to pay a higher percentage in income taxes. The “fair share” excuse to raise taxes is a lie. I cannot support a lie. It also paints an incorrect picture that many in the very wealthy category do not already contribute a whole lot to society. It makes all of them seem stingy when in actuality there are a lot of them that are very giving.
Financial assistance to the poor will be abused (either by the poor themselves, or by the government using the collected money to pad their pockets)
I believe that another big stumbling block is distrust in the system. Some of this distrust is understandable and even justified. I have personally seen people take advantage of welfare or other government assistance programs. Granted, there is no system that is abuse proof; however, I do believe that there are ways to decrease the abuse or to at least to allay fears that funds will be abused. One of my friends commented on my post and stated, “Any social program should be measured by the behavioral incentives it produces, not by its noble intentions.” I completely agree with that. Below are a few ways to use these funds to incentivize people to improve, not to just receive.
- Work program
The first way is to create a government work program that only credits funds to an individual if he/she works to earn the money. Many poor cannot get a job even if they wanted to because of a plethora of reasons. Many of these reasons could be reduced in a government work program. A work program helps the individual have self-respect and will cause the individual to appreciate the money he receives, which should help lower the temptation to waste the funds.
These work programs could include beautification jobs around town, assisting with town filing, repair or maintenance of the elderly or physically impaired homes, or any host of small to medium jobs that need to be done around town.
2. Donation to top tier charitable organizations working directly with the American poor
What if instead of allowing the government to take the funds generated from these taxes, they could be donated to top tier charitable organizations? This would allow taxed individuals to choose from a variety of very select organizations that work directly with the poor. This would help ease the mind of the taxed individuals and also allow them to feel good about their tax dollars.
In order to make sure these funds are actually used for the poor, any organization that accepts tax funded donations would be required to not raise the salary of their top two paid positions in any year that they accepted funds. These organizations would also be required to use at least 85% of their income for programs before receiving this tax aid, and 100% of all received tax aid would go to programs.
3. Restricted time of receiving funds
If the tax funds are given directly to an individual, the individual only has a limited time he/she can receive funds of this variety. I would imagine that two years is plenty of time to help someone get from a life of poverty to a sustainable living situation.
The people that would be limited in the time they are allowed to receive funds would be people of a certain age and health. If the person is 18-60 years old and physically well, then the person should be limited. If a person is over 60 or physically impaired, then there would be broader boundaries.
4. Incentives for employers to higher those just out of correctional facilities/rehabs
A good number of our very poor are people who have just left prison or rehabs. They remain poor and unemployed because of the large stigma placed on them once they leave these facilities. If, however, we incentivized companies to higher these individuals, then maybe we could get more of the very poor to work and out of poverty.
What if the government would use the funds to pay for 25-33% of an employee’s paycheck if they hire someone directly from a correctional facility or rehab release program? Of course this would only be a temporary assistance (see above). The assistance would cover jobs ranging from federal minimum wage to $15/hour.
5. Incremental release from program
One big problem with our current welfare program is that once an individual makes a certain amount of income, all support completely drops off. This is a terrible situation as it actually encourages people to stay below a certain income level. Instead of completely dropping off, assistance should be incrementally decreased based on income. That way any assistance decrease will be offset by income generated. Paul Ryan has noticed this as a huge flaw in our system and is trying to change that.
6. Job placement program
As I said earlier, there are a number of reasons why poor/homeless people cannot get a job even if they wanted to. I had a friend who made the following Facebook post and it is worth learning from:
This week started off with a reality check for me in regard to caring for and loving those in our city who are homeless. A friend who recently made our church his home asked me if I could take him to get his ID. It is his last step to ending his homelessness. He has a couple weeks sober (hallelujah), stood in the long lines to get his birth certificate, his social security card; went to the doc to do his TB tests, waited for the results which were negative (hallelujah) and now the final step, his ID. We arrived with excitement but left disheartened. He needs 2 forms of proof of residence. What? Why do we make it so difficult? He’s homeless and trying so hard to make a huge change in his life. But it’s not as easy as we may think. So before we so easily and ignorantly throw out the statement so often heard, “some people just want to be homeless”, it’s not as simple as that. I wonder how many got to the point that my friend did, but the systems requirements dashed their hopes and they gave up? each night, sleeping on the street is a night that makes it much easier to pick up the bottle again. Here’s an idea. Let him into housing and give him 60 days to get his ID. Here’s another idea. Christians open our homes and our churches to individuals who need a home. If you have or know someone who has empty houses that would allow us to manage them for men, women and families needing a home, please contact me. If you’re looking to invest in real estate, consider making an eternal Kingdom investment with your property. It’s a win, win, WIN!
You see? It is not as easy as you think it may be to get out of poverty. A job placement program could help make the transition from homeless to employed much easier.
Other Ideological Considerations
There are many who struggle with the idea of having a higher percentage tax on the very rich due to ideological reasons. These ideals are vast, but I would like to address a few of them.
- The rich already pay enough in taxes
I would agree with the statement that the rich already pay enough in taxes. So if we cannot get a bill through that increases the amount the very rich pay, how about if we pass a bill that demands 2-3% of the current taxes of the very wealthy will go directly to the poor? If we do this, why not increase the percentage by a point or two? If they are already paying enough taxes, then surely there is no problem with simply funneling the money to helping the very poor. And if people who think the very rich do not pay their fair share but have a problem with funneling the money to helping the very poor, then I guess we find out that these people are not as compassionate as they say they are and have ulterior motives.
Even if the very rich already pay enough in taxes, I believe that many more people would be willing to accept a small raise in taxes if they knew that the money was going directly to help the poor.
I agree that the way the American government spends money is wasteful. I agree that there should be continuing efforts to cut down on waste. A small tax on the very wealthy does not mean that we completely abandon any and all efforts to reduce government waste. We can do both simultaneously. So the acceptance of a small tax is not a rejection of strong fiscal conservativeness.
In fact, I have not even addressed whether or not the overall tax percentage of the very wealthy should increase or decrease. I believe that we could institute this special tax that will only be used to help the very poor and still decrease the overall tax rate of the very wealthy by decreasing government waste and increasing the amount of productive citizens.
2. Charity should be an individual choice not a government mandate
I agree that charity should be an individual choice. However, what we see in our nation is that not many are choosing to make charitable giving a priority. As this website makes clear, the amount of funds donated is extremely paltry overall, and less than expected or hoped for among the very rich. Take into account that some of the donations that the very rich give go to universities, churches, and international efforts and you will see that the amount in truly charitable donations to the American poor is even less.
Let me speak directly to my Christian friends who try to use theology to justify not having a higher tax rate for the very wealthy. In Scripture, the primary roles of government are to discipline those who do wrong, to reward those who do right, to protect the defenseless, and to help the weak (Rom 13:1-5; 1 Peter 2:13-14; many of the laws of the Old Testament are to support the defenseless and weak, see: Leviticus 19:9-10; Deuteronomy 14:28-29). If people are not fulfilling their roles as charitable donors, then I have no problem with government stepping in to make sure that the weak and poor are assisted. After all, that is one of the primary roles of the government. (Indeed, one of the main reasons God sent the Jewish nation into exile was because they failed to properly care for the weak.)
In Scripture there is no limit placed on what a government can or cannot do when it comes to taxes on the very wealthy. You will never be able to find a scriptural law that would make a higher tax rate for the rich unscriptural. So while you personally may not like the idea of the very wealthy getting taxed more, recognize that it is a personal decision on your end, not a scriptural one. So while you may be able to pull out concepts from Scripture to support your personal decision, ultimately Scripture does not speak to this. I readily admit that I cannot use Scripture to support a higher tax rate for the wealthy. However, what I can say is that one of the primarily roles of government is to provide for the weak. How you choose to apply that primary role is then a personal choice, not a scriptural choice (e.g., higher tax rate for the very wealthy or decrease spending in other places to free up more money for the poor). So please recognize that when you discuss this, you are discussing from personal preference, not from proper scriptural understanding.
Now let me speak to my atheist friends who expect everybody to agree to a higher tax rate for the very wealthy. If it were not for God’s command to give to the poor, I would not be in favor of taxes to support the weak. At best I would support causes that help people who have proven themselves worthy of receiving help to get some assistance and only if they can eventually show that they can once again become a contributor to society. If naturalism is the correct worldview, then taking from the strong to give to the weak who show no signs of becoming stronger is absolute stupidity. So if you were to convince me that your worldview is the correct one, then I would immediately stop believing that compassion to those who do not deserve it is a virtuous thing.
3. Taxing the very wealthy discourages people from pursuing the American Dream
I highly doubt that telling someone that once they make $450,000/yr that they will get taxed 2-3% more, amounting to a decrease of $9,000-13,500, would discourage someone from trying to obtain an income of $450,000/yr. Let me just ask you: would you trade in your $50,000/yr income for $450,000/yr even if you were to get taxed another 2-3%? If you would reject such a raise, then your math skills are very weak. Even if you were to be making $400,000/yr and were to get a raise to $450,000, you would still be making more money even with the tax normal tax increase and the extra tax for the poor (6.6% + 3%).
Remember, I am not necessarily proposing a tax increase. I am simply saying that I could support a higher tax rate – whatever that may be – on the very wealthy if I knew the higher taxes were to be used to directly assist the very poor.
4. Higher taxes on the very wealthy is punishing success
Higher taxes on the very wealthy is not punishing success, it is recognizing it. The truth of the matter is that most of the very wealthy are only that way because the less wealthy are purchasing items that allow the very wealthy to have what they have. Since the very wealthy are receiving their income from the less wealthy, including the very poor, I see no problem with requiring the very wealthy to re-contribute to those who helped them be as wealthy as they are, and especially those who are struggling financially.
I am talking about taxing the very wealthy a very small amount for a very special cause. This is not punishing anybody. I can understand the fear of moving up in a tax bracket. But that fear is among people who go from low-middle income to upper-middle income. There is far less trepidation of small tax increases when going from very high income to uber high income. I can tell you this, that not many of those very wealthy feel punished; read this article for more on that thought.
5. Taxing the rich at a higher rate to assist the poor is communism/socialism
I would say that this is not an accurate representation of my proposal. This is an example of how the language that we use is so important in our communication. Communism/socialism is much bigger than a small tax for a very select purpose. Making the claim that this one proposal is communism/socialism is at least four different fallacies. First, it is a hasty generalization in that a whole system is invoked to describe one proposal. Second, it is a straw man in that communism/socialism as systems is not what is being proposed and is not what should be argued against. Third, it is a red herring in that those buzzwords distract people from objectively critiquing the proposal. Fourth, dismissing the proposal because there may be some thing about it that looks like a small part of another system is declaring the proposal guilty by association.
Continuing, just because a system as a whole is not strong, it does not mean that individual parts of that system are not good. Just because providing for the poor from the funds of others happens to be a part of communism/socialism, it does not mean that it is as bad thing by itself. Imagine rejecting juries of one’s peers just because the American justice system struggles.
One last point. People who do not agree to a higher tax rate are not necessarily uncompassionate. Many of these people see many other flaws in how our government and people use money and would like to see these problems fixed at the root instead of just feeding the problem with more money. I can understand that and I do not think that requiring the very wealthy to pay a higher tax rate should stop us from finding ways to make our government and people more fiscally responsible. That is why I wrote this post. I think this provides many ways for us to compromise and to come together on many aspects and at least not be so far apart.
I think the perfect politician is someone who would use accurate language, understand both sides of the disagreement, be able to speak to ideological disagreements in a respectful way instead of a dismissive way, and be willing to compromise to bring both sides closer together.
So there you have it. Feel free to let me have it. I am looking forward to learning from you and to being challenged by you.