A Family Political Debate

Lately there has been somewhat of a political debate going on in our family via e-mail. I woudn't normally share this sort of thing on my blog, but I thought my hubby's replies were well worded. This debate has been between my dear hubby and another member (whose relationship to us will remain vague on this blog). This other family member has become very libral of late and very, well not vocal, but more...hmmm...what's the word I'm looking for...idealistic perhaps.

Anyway, they have been exchanging e-mails and sharing them with more family & friends as they politely exchange political views. I think my hubby is a smart & articulate man. I thought I'd share there most recent set of e-mails & perhaps it will just give you another viewpoint.

From my hubby:
Been hearing about Joe the Plumber in politics lately? Dunno who he is? Why he’s mentioned?

Obama talked to this guy at some point in the campaign. Joe’s issue was taxes as it relates to small business. Obama reveals a little about his ‘redistribution of wealth’ ideas… aka Socialism.

Here’s a link to an interview with Joe the Plumber that discusses his contact with Senator Obama and his personal views. The interview is backed up by a video clip of the exchange. Hell, I wish Joe the Plumber was running. He has nearly as much experience as Senator Obama, and clearly has quite a bit more sense (perhaps more than both candidates). J Not exactly articulate, tho.
http://familysecuritymatters.org/publications/id.1465/pub_detail.asp

Reply from family:
Clearly you're ignoring the latest news that Joe the Plumber is pretty much a hoax. plumbers make good money, but how many do you know make over $250k/year??

Besides, he owes $1200 in back taxes.

and he admitted he lied:Wurzelbacher conceded today that he is not in danger of being hit with the higher tax rate. He acknowledged that he wants to buy a plumbing company for $250,000 to $280,000. That wouldn't be how much profit he would make from the firm. He would make much less, he said. That would seem to indicate that Wurzelbacher would not be subject to Obama's proposed tax increase from 36 percent to 39 percent for those making more than $250,000 per family. Instead, he would be eligible for a tax cut that Obama is proposing. Source: http://abcnews.go.com/GMA/Vote2008/Story?id=6047360&page=2

And he's not even licensed:Thomas Joseph, the business manager of Local 50 of the United Association of Plumbers, Steamfitters and Service Mechanics, based in Toledo, said Thursday that Mr. Wurzelbacher had never held a plumber’s license, which is required in Toledo and several surrounding municipalities. He also never completed an apprenticeship and does not belong to the plumber’s union, which has endorsed Mr. Obama. On Thursday, he acknowledged that he does plumbing work even though he does not have a license. Source: http://www.nytimes.com/2008/10/17/us/politics/17joe.html?_r=1&oref=slogin

He sounds like a real smart cookie.... Good idea, he'll fit right in, Joe for Pres!

Rebuttal by my hubby:
Huh, someone doing plumbing without a license? Without some Union’s permission? Shame shame. And owing back taxes? On an unlicensed plumber’s income? Who woulda thought?

Sarcasm (just for fun) aside, why is it a hoax? Yes, Joe’s future company, were he intelligent and diligent enough to make it work, still wouldn’t earn enough to put him in Obama’s top 5%. By Joe’s own admission. But that doesn’t change any of Joe’s points, though, now does it? It’s not a hoax, per se, in that his trick to get into the media spotlight (on purpose or by accident) does not make his points untrue or preposterous (http://www.merriam-webster.com/dictionary/hoax). He either mis-spoke or lied about being in that tax bracket, but that is aside from his points in general, as supported by the articles you sent.

There were other quotes from those articles, including:

"It's not right for someone to decide you made too much -- that you've done too good and now we're going to take some of it back." “ That's just completely wrong," he added.

And

"Not that I don't want to be taxed," Wurzelbacher told "GMA." "You have to be taxed. Just because you work a little harder to have a little bit more money taken from you, I mean, that's scary. I worked hard for it. Why should I be taxed more than other people?"

And

"You know, me or … Bill Gates, I don't care who you are. If you worked for it, if it was your idea, and you implemented it, it's not right for someone to decide you made too much."

Joe’s point seems to revolve around this: tax everyone fairly and evenly. How to do this is obviously a complex issue that isn’t easily solved. I don’t believe either candidate solves it in the plans they put forth. I could, but I don’t think I’d get many votes. Obama is clearly moving in the wrong direction, imho, with talk of ‘redistributing wealth’. McCain at least talks about de-regulation and getting government reduced where possible. (No, I don’t actually believe McCain will make great strides in that area, but at least he’s talking towards capitalism and free-market instead of against it).

Look, it’s an issue of principal: just because Jack’s small business is taxed less doesn’t make it right to tax Jill’s bigger business at a higher rate just because she’s more successful than Jack.

And putting Joe the Plumber aside: This is MY point: wealth is not wrong; wealth is a worthwhile goal (though a lesser goal as far as life in general goes, I’ll admit). Wealth does not need to be, nor should it be, redistributed by governmental force. People with money put that money to use, or they loose it. Working money creates opportunities. And there are still many opportunities in this country for those willing to work for them. I am against Socialism in most any form.

Lastly, if anyone cares about how I’d do it, this is how to tax fairly:

Eliminate income and gains taxes in totality, including capital gains, inheritance, property taxes, and similar taxes that involve taxes on what you get or on what you have. These kinds of taxes are redistribution of wealth.

Replace that with taxes on goods and services, or on what you spend. Tax purchases of groceries, gas, and sunscreen. Tax attorney fees, massages, and carpentry. Tax movie tickets, cover charges, and Nevada prostitutes. Tax the purchase of investments (not the growth and income of investments). Implied is also the fact that all goods and services be taxed at the same rate (x% on a bottle of beer and that same x% on a Lexus). Lastly, implement tariffs on imports and exports (start with the world average tariff rate).

As an example, everyone is taxed the same on a bottle of beer, whether they work in the mill or an attorney’s office. If the tax rate is 25%, then you pay about 50 cents in tax on that beer (not a Boston beer, I’ll admit… that’d be more like $2), and about $20,000 on a Lexus. If all you can afford is a beer, you’ve paid $0.50 taxes. If you can afford a beer AND a Lexus, then you’ve paid $20,002 taxes.

Those without much money spend little, and so they are taxed little. Those with lots of money spend or invest it, and they are taxed much. Those with money but don’t spend it on investments (the old cash-in-the-mattress trick) slowly loose it to inflation (or their mattress catches on fire).

In this manner, everyone would be taxed very similarly, foreign companies would see no shelter from American taxes, retired people wouldn’t lose what they’ve spent their lives earning, and those that have drive to excel are not paying a disproportionate share to support those that don’t. Hey, even the IRS would be downsized… who wouldn’t want that?

If I were a tax expert, I’d probably shoot holes all through this plan. I can think of two holes right off the bat that would need to be worked on. If you’ve got a tax gun, lemme know what you think. I suppose it doesn’t really matter, though, cuz those in power aren’t likely to change the present system anytime soon. If I’m wishing for a new tax system, I might as well wish to be king of the world.

Reply from family:
As I understand it, you say you're against "redistribution of wealth" (which is how Obama describes his current economic plan in light of the current economic crisis) because people should get what they earned and people who were more successful shouldn't be taxed at a higher rate than lower-income people.

However, what about the top earners that got there because they took advantage of YOUR money. Wall Street CEO's are walking away with multi-million dollar salaries and bonuses right now. You and I just contributed to that $700 billion bailout and what do we get in return? Americans are getting their homes foreclosed on left and right and people are losing their jobs - our unemployment rate has risen dramatically. If there are no government programs (funded by the taxes you're against) then how are these people going to find section 8 housing or receive unemployment before they can find another job? How are these people going to get back on their feet and be contributing members of society?

The rich will get richer and the poor will get poorer. Something needs to be done now to stop that trend and get America back on track. Your tax plan in theory might work and be fair and equitable if we were starting from scratch, but we're in a financial crisis right now. Along with the privileges and benefits of being an American come duties and responsibilities. In times of crisis American's enlist in the armed forces and risk their lives to protect our country. In times of economic crisis we need American's to do their patriotic duty of helping fellow citizens in need. People who can afford to pay more in taxes should. Instead of buying a fridge full of Cristal, Jay-Z can pay a little more in taxes. Instead of buying an 8th home, McCain can afford to pay a little more in taxes. Instead of buying diamond-encrusted cuff links, Mr. CEO can pay a little more in taxes.

If we don't compensate for the huge disparity that's evolved between the rich and the poor, our economy is going to crumble.

Final rebutall (so far) by hubby:
“As I understand it, you say you're against "redistribution of wealth" (which is how Obama describes his current economic plan in light of the current economic crisis) because people should get what they earned and people who were more successful shouldn't be taxed at a higher rate than lower-income people.”

Yup. That’s what I’m saying.

“However, what about the top earners that got there because they took advantage of YOUR money. Wall Street CEO's are walking away with multi-million dollar salaries and bonuses right now.

I have no problem with Wall Street guru’s making big bucks. In fact, I count on them. Much of my retirement money is wrapped up in mutual funds, which are, of course, mostly groups of stocks. I do not play the stock market personally, because I have little knowledge about them. But I depend on a wall street super-nerd to know all about them. The success of my mutual funds depends, in the long run, on Wall Street CEO’s and their uber-nerd limo-riding analysts. Yeah, things are poor now. That happens in a free-market, especially right before a big election. But I have no problem with a big-earning Wall Street CEO over the long run, on average, because it is they who yield us a 10%+ 75 year stock market average growth, and 30 year mutual fund growth in excess of 12%.

Besides, I try not to worry what others are making. If someone can make millions swinging a bat at a leather-wrapped ball or spewing 4-letter rhymes set to a migraine-inducing rhythm, what is that to me? Good for them. I can’t do it. If I could, I’d be making millions, too. No, it’s my job to do my best, and excel. Jay-Z (whoever that is) can keep his money. I’ll make my own.

“You and I just contributed to that $700 billion bailout and what do we get in return?

After much thought, and before they voted, I decided I am philosophically against the bail-out. I did not support that bill. I will not support another. If companies or individuals lend unwisely, they are simply reaping what they sow. Instead of bailing them out, they should be prosecuted, or at least denied welfare when they hit the streets This bail-out simply sets the stage for it to happen again in 15 to 20 years, just like it happened 18 years ago. It’s a bad message to the industry: “Lend irresponsibly; the government is going to bail you out.” Geesh.

“Americans are getting their homes foreclosed on left and right and people are losing their jobs - our unemployment rate has risen dramatically. If there are no government programs (funded by the taxes you're against) then how are these people going to find section 8 housing or receive unemployment before they can find another job? How are these people going to get back on their feet and be contributing members of society?"

I do not oppose welfare as a government program. The government should help people when they are down and out, in order to “get back on their feet and be contributing members of society”. I don’t know anyone who doesn’t want to help people who really need it, and most are willing to spend their taxes on it.

I oppose a bloated welfare system that does not motivate people to act, as I believe it is now. Since when is there a lack of government moeny to help people back on their feet? The problem is the programs keep paying people who won’t get on their feet. Then there’d be more money left to help more people who want help to help themselves.

Look, I have a friend with cystic fibrosis. He cannot work. He get’s a government check. I have no problem with this. There are those that need the help. I do have a problem with the fat lady across the street from my office who yells at her kids all day while smoking 3 packs and only moves in order to collect her check from her mailbox. I have a problem with the moron in the checkout line with me that pays for his groceries with food-stamps, then buys beer and two cartons of smokes with cash (seen that first hand, and told him “you’re welcome” as he left. Got a dirty look for my efforts).

And lastly, I am not against taxes. How can we have a government without them? How could I be for a government program to help people get back on their feet and against taxes? No, I am against a tax system that buys votes by giving breaks to the average majority at the expense of the successful minority. I am against unfair taxes. I see Obama’s tax plan as unfair. I see McCain’s tax plan as less unfair. I see my tax plan as fair. (of course I do. It’s mine, after all).

"The rich will get richer and the poor will get poorer. Something needs to be done now to stop that trend and get America back on track."

There’s nothing wrong with being rich, and the poor can’t get much poorer… that’s the definition of poor.

Okay, another attempt at witticism aside, we have a HUGE middle class in America compared to the rest of the world. So that’s not a big problem. There will always be poor people. There always have been those who lacked the learned ability, natural talents, opportunity, and luck to succeed. America, at least, doesn’t actively try to stop people from trying. And most millionaires are first-time millionaires. The number I heard was 80%, though I would welcome some research on that. So the rich are rich because they worked for it. This doesn’t seem to be a problem for me.

"Your tax plan in theory might work and be fair and equitable if we were starting from scratch"

Agreed. There’s one of the two holes I mentioned. How do you start that? I don’t have an answer, other than just biting the bullet and jdoing it, which would be reckless lacking advanced economic research. I haven’t done that. But if the system would work, and is more equitable, then it should be pursued.

"but we're in a financial crisis right now. Along with the privileges and benefits of being an American come duties and responsibilities. In times of crisis American's enlist in the armed forces and risk their lives to protect our country. In times of economic crisis we need American's to do their patriotic duty of helping fellow citizens in need [emphasis added]. People who can afford to pay more in taxes should. Instead of buying a fridge full of Cristal, Jay-Z can pay a little more in taxes. Instead of buying an 8th home, McCain can afford to pay a little more in taxes. Instead of buying diamond-encrusted cuff links, Mr. CEO can pay a little more in taxes."

No. No. I vehemently disagree. You’re linking military responsibility and economic responsibility as important factors in defining patriotism, and I don’t buy that.

It is my patriotic duty to defend my country against foreign and domestic military threats. If called to do so, I would sweat my fat butt through boot-camp, and go. And I may be shot through the pie-hole. I would go anyway. That’s patriotism.

It is NOT my patriotic duty to sacrifice my hard-earned money and my family’s welfare to pay for irresponsible lending practices on the part of one particular industry. It is not my patriotic duty to give my money to those that don’t have as much as me. That’s not patriotism, that’s Socialism. And in the extreme: Communism. It is my moral responsibility to help those in need, and I do so regularly with my checkbook (in taxes, in church, and once in awhile hand2hand). But I oppose the government telling me I have to, above and beyond a reasonable amount to get someone on their feet. Reasonable welfare is one thing. The redistribution of wealth is quite another.

America has historically left the free-market to decide the economy as much as possible. When the government interfered, there have been negative consequences. When Carter imposed a gas price freeze, may-hem ensued.

No, and I dispute the term ‘crisis’, and substitute ‘correction’. Crisis sounds better in the news. But in historical terms, this is a correction. Further, ‘correction’ implies that it’s cyclical and will re-correct the other way. There was an unsupported economy in the 90’s (internet business), and it flopped leading to a recession. There was an unsupported economy in the 2000’s (housing). It’s flopped. Many forecasted it. It happened. Big surprise. It’s only a ‘crisis’ because nothing was done to stop it the last time around. And here we go bailing them out again. Ug.

"If we don't compensate for the huge disparity that's evolved between the rich and the poor, our economy is going to crumble."

I’m not running for the hills yet.

This same issue was raged during the Clinton/Bush election in 1992. It raged again during the Bush/Gore elections of 2000. I’m sure it raged before that since time began, but I’m not that old. Yet.

The Dow is still up compared to 1992. It’s up compared to 2000. Even in this slump. As long as the population grows and people are willing to work to get ahead, the markets will climb in the long run, on average. Poor people will climb out of their holes and become millionaires. Millionaires will squander their inheritance and become poor. Those that can, do. Those that cannot, whine. I oppose those that cannot dictating to those that can.