Flat Tax: A Battle Against Privateering

In an earlier blog we were talking about the flat tax. I promised to go deeper into the idea of a flat tax. I even suggested the title might be “Why there will never be a flat tax.”

Actually, I think all of us understand why there will not be a flat tax.

First, there is the power of the dollar. The U.S. Congress sets tax policies, so people who want favors make contributions to elected officials. Soon a law is passed favorable to the contributor's cause.

Second, Congress sets social policy by giving tax breaks to activities they deem to be in the country's best interest. Want people to buy more homes? Give tax credits for home ownership. If Congress desires to disarm the American public, they will tax gun ownership. Perhaps the most important reason there will never be a flat tax is the power the progressive tax scheme gives to elected officials.

The president and Congress just reached a deal on taxes. The new deal penalizes those who work and rewards those who are not working. How will this budget deal help the country? Dr. Art Laffer, noted economist, recently tried to reduce this issue to the basics with an example of two farmers. Farmer A and Farmer B are equal in earnings and opportunity. Farmer B goes on unemployment. Farmer A is now paying for Farmer B. You can stretch the numbers, but it always comes out; someone else is paying for the entitlements people collect. It doesn’t matter why a person is on government benefits, someone else must pay the bill.

You ask, doesn’t the government use their own money? The only money government has is taken from taxpayers. The government does not earn money.

This discussion is not about food stamps, social security, unemployment, disability or aid to dependent families. The question is one of freedom for people, from an unrestrained government. How do we know it is unrestrained? Some people pay more than 50% of their income in taxes while others don’t pay income taxes at all.

Our current progressive system disregards individuals in our system and places us into groups (classes) of people. Under the progressive system, it is assumed everyone is born to a certain class. It is the government’s job to even out the playing field so every person has an equal chance. This system supposes the government is the only qualified arbiter. Actually, the government and government bureaucrats/officials are the least able to achieve equal opportunity. The most a government can do is adjust the playing field to an equal level of misery. 

Flat taxes are fair. Flat taxes take the government bureaucrats out of your life. Flat taxes assure everybody a chance to have “skin in the game.”

What those who would divide us into classes and pit us against one another forget (or never knew) is that Americans are special. We do have Manifest Destiny. We are special, we do care about one another, and we are the most generous country in the world. We stop to pick one another up when there is a crisis. We don’t need the government to make our decisions; we are a great people whose best years are ahead of us.

Privateers were similar to pirates_ but were hired by governments to disrupt the opposing navy; it was outlawed in 1865. Nearly 150 years later, are we being disrupted by congressional privateers?

The flat tax will be the first step in taking this country away from the politicians and bureaucrats and returning it to the people who actually built it. The Left Wing in this country is wrong: taxpayers—not government—built this nation.

The current system benefits the super-rich, movie stars, professional athletes, politicians and special interest groups who claim to care for the rest of us. A flat tax benefits every American. The very poor may only pay 12% of a few thousand dollars, but they have the pride of knowing they count and they contribute. Pride, respect and participation matter. Because of who we are, class warfare will not survive here.

So the real question is why we allow Congress to continue to control our lives by giving them the power to unequally tax us?