Let’s Stop Taxing the Rich More in the Name of ‘Fairness’
“I remember I was very sad for many days when I discovered that in the world there were poor people and rich people; and the strange thing is that the existence of the poor didn’t cause me as much pain as the knowledge that at the same time there were people who were rich.” —Eva “Evita” Perón, La Razón de Mi Vida (The Reason for My Life)
The Democrats are already screaming that the proposed tax cut bill will benefit the rich more than it will benefit the poor. Presently, nearly 50 percent of Americans don’t pay any Federal income tax. Math is hard for some people, but not so much that a person can’t figure out that someone who makes a million dollars is going to get a bigger tax break than someone making $35,000.
Liberals are incensed when it’s suggested that “the rich” get any type of tax reduction even though the top 50% of wage earners pay 96% of all income taxes. Since they spend more money, the rich also pay a disproportionate amount in sales, property, entertainment, and excise taxes. Without the rich, millions of people would not have jobs.
The first computer my company purchased in the mid-1980s cost $7500. It was huge and could only perform a few simple tasks, mostly word processing. The floppy disks were the size of dinner plates and held very little data (360K). Almost overnight, computer prices dropped and performance levels increased dramatically. We went from kilobytes to megabytes to gigabytes to terabytes. Cell phones, tablets, smartphones, streaming video, and more are marvels of technology and getting cheaper.
What made these performance gains and price reductions possible? People with lots of money purchased the first high-priced machines. They had the financial ability to lay out “excess” capital for what most people would consider luxury items. These once luxury items — cell phones — are now so cheap that even the homeless have them. If you have a smartphone, you are holding apps that would have cost you a million dollars to acquire 25 years ago if they existed. This is a picture of one of the first records. It played one song and took up more space than an iPod that can hold up to 40,000 songs.
The research and development costs of any new technology are enormous. That’s why the initial entry of new products into the market is expensive. But over time, when costs are recouped and production increases, costs and prices fall.
Slamming the rich by contending that they should pay more in taxes to equalize income is the sin of envy. Envy is not the same as jealousy or covetousness. The covetous person says, “I wish I had what he has, and I’m miserable that I don’t have it,” and he votes accordingly:
I’d like to have what he has, but I know I can never get it. Nobody should be allowed to have it or at least that much of it. If I can’t have it, neither should anyone, and if I can’t make this happen, I’ll make sure it costs him a lot of money to own it. I’ll work to destroy people who can afford these things. Maybe I can get the government to make it illegal to own or too expensive to keep.
This is why the Bible describes envy as “rottenness of the bones” (Prov. 14:30).
Societies that struggle to exist economically are infected with envy. Prosperity in others infuriates the envier and moves him to destroy what he does not have and will not work to get.
Western enviers are sophisticated. Enviers in civilized societies don’t burn a villager’s crops or sabotage his wells. They run for political office or vote for those who do so they can stick it to the rich in the name of “tax fairness” and “social justice.”
The long-term result is the destruction of the prosperous man’s ability and incentive to create wealth. In the end, the destroyed crops, the poisoned well, the high taxes hurt all of us. With no discretionary capital, there is no one to buy those initially expensive goods that make life easier for all of us. So, instead of envying the rich man, thank him and work to be like him.
Envy appears early in history when the Philistines envied the prosperity of Isaac:
Now Isaac sowed in that land, and reaped in the same year a hundredfold. And the Lord blessed him, and the man became rich, and continued to grow richer until he became very wealthy; for he had possessions of flocks and herds and a great household, so that the Philistines envied him. Now all the wells which his father’s servants had dug in the days of Abraham his father, the Philistines stopped up by filling them with earth (Gen. 26:12–15).
The Philistines could have dug their own wells and inquired of Isaac to learn the methods of his success. Instead, they destroyed his property to bring him down to their standard of living. With Isaac’s wells sabotaged, a drought would affect Isaac and the Philistines equally. But enviers don’t think ahead. They only care about dragging the successful down to their level of incompetence.
Modern-day economic theory feeds off the sin of envy. The first step is to promise the citizenry that they will get some of the largess of the rich. When that only goes so far, legislators will make it more difficult for the prosperous to remain prosperous. Obstacles will be put up to stifle their success, all in the name of “fairness.” We’ve seen it happen before, and it’s destroyed nations and impoverished hundreds of millions around the world.
Taxing someone at nearly 40% is stealing, no matter what the reason. It’s not “equal justice under the law.”