Friday, 26 October 2012

The Land of Chocolate (and High Taxes)

Homer Simpson
Homer Would Probably Vote YES on Prop 30

The election is now just over a week away, and still not quite sure what the 6th of November will hold.  I suspect that President Obama will win, though given how poorly he has performed recently - and just how how shrill and desperate his supporters have become - I am less confident of that than I was a month ago.

But as the French say, plus ca change, plus c'est la meme chose.  Put simply, some things apparently never change.

In my old home state of California, awash in a sea of red ink of volume only slightly less than the San Francisco Bay, apparently, Governor Jerry Brown has put on the ballot Proposition 30, which would place sur-taxes on "very high" incomes to help to balance the state's shaky books.

(As an aside, all the sturm und drang about Mitt Romney's infelicitous "binders full of women" remark I suspect should be placed against the Democrats' ledgers full of nothing.)

Governor Brown's proposal would, for example, raise taxes on people earning 500,000 per year from 9.3 to  12.3 per cent.  The Proposition is leading in the polls, and likely will pass, though support is sliding.

Mr Brown today offered in an interview that the rich have a moral obligation to pay more, citing Biblical scripture.  Setting aside Governor Brown's very shaky math - he defended the tax raise pointing out that a 3 per cent rise in tax is modest; in fact, a rise from 9.3 to 12.3 per cent is more than a 30 per cent increase - but what's a little fun with numbers among friends.

The larger issue is do the rich have a moral obligation to pay more in taxes?  And, more to the point, how much more?  We've all seen the data, and heard the notorious comments by Governor Romney about the 47%.  The richest 1 per cent pays about half of all income taxes.  I suspect that, in California, home to among the most progressive income tax regimes in the country, that figure is probably not far off.

I am not a fan of the flat tax for various reasons, and I generally accept the socialist argument that those with more should pay somewhat more.  But when do we ask the question, does the government have a moral obligation to spend its revenues wisely?  To be a better steward of its resources than it is?

Senator Tom Coburn (R-OK) recently released his book on government waste, and suffice it to say, I wonder how ethical it is for the government to take in tax money and spend it on sports arenas or the PGA Hall of Fame.  And do we really need to be promote watermelon consumption or to create robotic squirrels?  I've seen all of the "Terminator" movies, and am suspicious that that last effort is going to end well.

But good Old Governor Moonbeam - who once aspired to the priesthood - adheres to at least a segment of the faith.  Right to the bitter end, apparently.

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