(The official White House portrait of John F. Kennedy by Aaron Shikler)
Equal Taxes for All
Author: Paul Michael Owens
A government must tax its citizens to maintain its deemed operations. Governments throughout history have deemed some sort of tax necessary. Ancient Egyptians paid taxes. Ancient Romans paid taxes. Taxes have been shown to be levied throughout the Middle Ages. Most historical taxation of the public involved no public input. These taxes were created by Kings and Emperors of various populations to fund their own ideas and projects. The United States Government started a historical trend with the formation of a government for the people and by the people. This put the control of how a government chooses its tax scheme theoretically back into the hands of the people. The United States Government currently uses a progressive taxation system on income that is based on the amount of income one earns (Tax Foundation, 2011). There are also other taxes on the individual such as the gas tax that is levied on the public that go to the government. Taxation is a way of life when an individual seeks protection and services from a government. A person has to look hard to find something that is not taxed one way or another. The difference on the multitude of variety of taxes would be where these taxes are going. If a person lives in a city, they will pay a city tax. One also pays a tax to the county if one has property. Income is taxed by most States and the Federal Government. When one purchases gas, it is also taxed by the State and the Federal Government.
In our current environment of total taxation, the United States Government has more expenditures than it has tax revenue. Sparing a short period from 1998 to 2001, the United States Government has been deficit spending, which is spending more than one earns (Government Printing Office, 2005). One hears many statements of needing revenue for the government to pay its bills. This is only a perspective of how the government should operate. Government needs to stop spending more than it brings in. Like every other American Family who lives within their means, the government should follow the same model. The required cuts would be a drastic change and would be too much for people to handle or even comprehend because of the amount of dependence America has on its government. Talking about how much money the government spends can be overwhelming, which is why it becomes a daunting subject. The figures that the budgets present with more than 9 zeros on the end can be remarkably scary. To make it easy, one simply has to cut off all the zeros and use that number as an example. For instance: the government spends 31,000 a year, while only earning 28,000 a year. This is reflective of the 2010 operational budget of the United States Government (Government Printing Office, 2005). This is also representative of how the Federal Government has been deficit spending since 1931. For only 10 years randomly placed in the 80 year history, the United States has been spending more than it has been taking in (Government Printing Office, 2005). This is where the difference between debt and deficit spending come into play. The United States of America is very close to being 15 trillion dollars in debt (US Department of Treasury, 2011). The United States is in this situation because of the 80 year history of spending more than earned revenue it receives through taxation.
The current conversation about change in tax strategy involves a lot of rhetoric about taxing the 1% top income earners more. The top 1% already pays over 50% of their income in taxes, while over 47% of individuals pay no federal taxes (National Public Radio, 2010). This is an inherent problem for a real change in strategy because the conversation has been redirected from appropriate spending of what tax revenue is available to creating more revenue so programs in place can continue. Americans have voiced in many polls that they do not want to see a tax increase. The soliloquies abound that the rich are getting richer and the gap between the rich and poor is growing is completely true. These comments have nothing to do with taxing rich people more and a fair tax strategy. The tremendous debt and overspending of the available government funds is a big problem that does have a direct relation to taxation. Even if the rich were taxed more, it would not correct the poor fiscal irresponsibility the current politicians practice. The practice of deficit spending needs to stop. The government needs to shrink its expenditures, and further decrease the tax burden on the public at large, and make an attempt to work on the ever increasing debt this country owes. The rich getting richer and gap growth has to do with the government facilitating bailouts for companies that otherwise would have gone bankrupt for shady deals that appropriately reviewed would have found as fraud. The government tax conversation should not be about generating more revenue at all. A government should not have an agenda of “generating revenue”. The government should be having a conversation about the scope of government operations and what is really needed from the government to service and protect its citizenry. A redefining tax strategy should be included in these conversations.
A tax strategy should be fair for every citizen regardless of their wealth. A government should be forced to operate within its means with the only exception of War. One must also include what taxes are being spent on when talking about taxes. What does the United States Government spend most of the tax dollars on? The largest expenditures the government has can fall in three big areas: Defense, Social Programs, and Treasury (US Department of Treasury, 2011). The largest expenditure is for Defense and Security of the nation. The second largest expenditure that the Federal Government spends the tax money on is social programs which means the government pays totally or supplemental for a citizen’s survival. The third largest area of the expenditures is a complete result of over 80 years of deficit spending. The United States Government has to continuously borrow money to pay back earlier borrowed money from an entity created by the United States Government to be a neutral entity to handle the United States Monetary Policy called the Federal Reserve. The Federal Reserve, which is a private corporation, was created in 1913. The Federal Reserve loans the United States Government money and makes a profit in return. This subject can and has been expounded on but relevant to this topic it plays a large part in the unnecessary expenditures of the United States Government. The tax policy plays a very large role in the operations of a government. In the past the government was not allowed to spend more than it generated, other than in times of war in which these cases a war tax was implemented to pay for the unexpected expenditures. Now all the government has to do is borrow money. This directly affects taxes because it creates a base the must be paid, similar to a minimum payment on a credit card. This base is now the third largest expenditure of the United States Government. Understanding what tax money is spent on is invaluable information that helps with the discussion of what type of tax strategy should be in place.
The biggest challenge in understanding taxation the American Way, is to finally understand that the current government is looking for ways to create money so it can spend it on programs that may not be nationally necessary. To further complicate the issue, a person must be able to look past the gimmick of the Two Party System. The two party system is only there to blind the general public of the real issue at hand, which is a group of individuals whose goal is to further their own agendas which is currently not the agenda of providing the general welfare of the nation. The current overwhelming public government dependency is not a fruitful path to success of a nation. A government that taxes a small group of people overwhelmingly to support a larger group of people is an unsustainable model. These are the conversations that need to be had to correct the irresponsible fiscal policies that are currently in place. The only way to get the United States Government back in-line with true American values is to shrink its programs considerably and present a fair tax plan to the citizenry that creates an equal playing field for all regardless of wealth. This fair tax plan must include forcing the Federal Government to “Live Within its means”.
Bibliography:
Government Printing Office. (2005). Historical Tables of the United States Budget. Retrieved October 19, 2011, from Government Printing Office: http://www.gpoaccess.gov/usbudget/fy06/pdf/hist.pdf
This document is created from an Executive Office of the President of the United States. The Office of Management and Budget provides facts and figures dating back to 1789. This document provides a very good history of the tax collection and expenditures of the Federal Government. There are many tables found which include a very heavy amount of data that help expand on points created within my paper and further prove how irresponsible the government has been spending for decades.
National Public Radio. (2010, April 04). All Things Considered - Who Pays Taxes? Not as Many as You Think. Retrieved October 19, 2011, from National Public Radio: http://www.npr.org/templates/story/story.php?storyId=125997180
Robert Siegel is the host of All Things Considered. All Things Considered is a nationally syndicated show that is broadcasted by National Public Radio. On April 4th, 2010 , Mr. Siegel interviewed Mr. Roberton Williams who is a Senior Fellow at the Tax Policy Center, which is a Washington Think Tank whose mission is to review all aspects around the Federal Government's tax policy. In this interview Mr. Siegel provides some interesting facts including the amount of citizens who pay no tax. This interview provides valuable facts that pertain to many points I express.
Tax Foundation. (2011). Federal Individual Income Tax Rates History. Retrieved October 19, 2011, from www.taxfoundation.org: http://www.taxfoundation.org/files/fed_individual_rate_history_nominal&adjusted-20110909.pdf
The Tax Foundation is a nonpartisan tax research group based in Washington, D.C. This is a document which provides tables on the tiered income tax structure of the United States back to 1937. This document provides statistical data of the rate of taxation and the yearly changes that have occurred through the reported history. This document provides me the evidence that I need to make valid points on the amount of taxes that people have to pay based on their income level.
US Department of Treasury. (2011). Debt Limit. Retrieved October 19, 2011, from US Department of Treasury: http://www.treasury.gov/initiatives/Pages/debtlimit.aspx
The United States Department of Treasury provides this webpage as a reference page for information about the debt limit. This page provides specific definitions of what the debt limit includes within its scope and what is not applicable to apply to the nation's debt. This page also provides an in-depth review of the nation's debt limit and provides a large amount of documentation. This page is useful in providing definitions and data that can be used for my argument.
US Department of Treasury. (2011). FY2012 Budget in Brief. Retrieved October 20, 2011, from US Department of Treasury: http://www.treasury.gov/about/budget-performance/budget-in-brief/Documents/FY2012_BIB_Complete_508.pdf
This document created by the United States Department of Treasury contains Fiscal Year 2012's operating Budget Request. This is a 125 page document that specifies how much money is requested and the anticipated allocation of the requested money. This document helps expand the argument on how much money the Federal Government is spending. The data and statistics provided in this document is very valuable to my argument.
US Department of Treasury. (2011). The Debt to the Penny and Who owns It. Retrieved October 19, 2011, from Treasury Direct: http://www.treasurydirect.gov/NP/BPDLogin?application=np
The Treasury Direct website is a portal which provides reports on many items regarding the Federal Government expenditures and obligations. This site provides a large amount of data and statistics in regards to the National Debt. It segregates how much the general public is responsible for and how much intergovernmental agencies are responsible for. The final current total tally provides a grossly large number that all should be aware of while the government continues to spending away. This site provides valuable information for my argument.
