Our tax policy is fundamentally flawed. I just heard a Democrat strategist claiming that “most people think their tax burden is fair.” Yeah, when you count all those not paying taxes or even getting a check from the government, you easily get a majority that thinks the system is fair.
Basically, the problem boils down to those who pay no taxes but have the majority power to impose on others the burden of paying for everybody.
How can this be fixed?
I think the only way would be by a new tax system, whether the fair tax or something like that but that operated as follows: everybody has skin in the game and everybody knows exactly what their share is of what we together are paying for every government program.
For example, in a totally pure flat tax, you could compute your share of the total national income, and thus figure out your share of any program.
In a hypothetical specific example, let’s say the total earnings of US citizens was 10 Trillion dollars. Suppose further that the total government budget was 1 Trillion, exactly 10 percent. (Completely hypothetical, remember, to make the numbers easy to see).
Suppose there was a flat tax of 10 percent — every dollar earned would be taxed at 10 percent. If you earned $100,000, then your tax would be $10,000. Not only that, it is immediately apparent that your share of the 1 Trillion is exactly 10 to the minus 8th power, or one-hundreth of one-millionth. Please bear with me!
Then it is also transparent, not totally obscure as it is now, that for every single expenditure of government, whether it be national defense, $200,000 to transplant a shrub, or 131 GSA junkets for Jeff Neely, you and everyone else would know exactly what your share of the cost was. You would know for example that a 1 Trillion bailout would cost you personally $10,000 (assuming fully paid for, not borrowed or inflated). Or that expanding some entitlement or other would be costing me personally $5,000.
I would like to have that information.
The point I am making are not the specifics of my hypothetical example. My point is that this would create a transparent system where everybody could see their share. No more “I want my Obama money” paid for by somebody else.