October 24, 2008


Obama and the Tax Tipping Point:

What happens when the voter in the exact middle of the earnings spectrum receives more in benefits from Washington than he pays in taxes? Economists Allan Meltzer and Scott Richard posed this question 27 years ago. We may soon enough know the answer.

Barack Obama is offering voters strong incentives to support higher taxes and bigger government. This could be the magic income-redistribution formula Democrats have long sought.

Sen. Obama is promising $500 and $1,000 gift-wrapped packets of money in the form of refundable tax credits. These will shift the tax demographics to the tipping point where half of all voters will receive a cash windfall from Washington and an overwhelming majority will gain from tax hikes and more government spending.

In 2006, the latest year for which we have Census data, 220 million Americans were eligible to vote and 89 million -- 40% -- paid no income taxes. According to the Tax Policy Center (a joint venture of the Brookings Institution and the Urban Institute), this will jump to 49% when Mr. Obama's cash credits remove 18 million more voters from the tax rolls. What's more, there are an additional 24 million taxpayers (11% of the electorate) who will pay a minimal amount of income taxes -- less than 5% of their income and less than $1,000 annually.

In all, three out of every five voters will pay little or nothing in income taxes under Mr. Obama's plans and gain when taxes rise on the 40% that already pays 95% of income tax revenues.

And we have Barney Frank saying outrageous things like this:

I believe later on there should be tax increases. Speaking personally, I think there are a lot of very rich people out there whom we can tax at a point down the road and recover some of the money.

I put up a quote from Neal Boortz's piece To the Undecided Voter about how democracy fails when the scales tip and people can vote themselves more money. Andy McCarthy received a similar quote from this blog's namesake, Robert Heinlein.

A perfect democracy, a "warm body" democracy in which every adult may vote and all votes count equally, has no internal feedback for self-correction.... [O]nce a state extends the franchise to every warm body, be he producer or parasite, that day marks the beginning of the end of the state. For when the plebs discover that they can vote themselves bread and circuses without limit and that the productive members of the body politic cannot stop them, they will do so, until the state bleeds to death, or in its weakened condition the state succumbs to an invader — the barbarians enter Rome.

I think our country is in serious trouble.

But apparently Sarah Palin's clothes matter more than massive voter fraud and Democrat donation fraud.

"I love mankind; it's people I can't stand."

Posted by: Sarah at 04:55 AM | Comments (4) | Add Comment
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1 I've always thought that Starship Troopers had a good plan for government...

Posted by: airforcewife at October 24, 2008 09:02 AM (mIbWn)

2 Will -- According to reality, social security, Medicare, and education each outspend defense spending.

Posted by: Sarah at October 25, 2008 04:18 AM (TWet1)

3 I thought the movie was a horrible parody of the book--maybe this is what you are thinking of. Heinlein's other contemporary writings made it pretty clear that he was not making a mockery of the ideas in the novel. Later in life, he did become very liberal; in his memoirs, Isaac Asimov attributed the change to Heinlein's second wife. In light of how shackled our "merchant class" has become (do you know any small business owners?), the "nation of merchants" line is a pretty funny one. Sig

Posted by: Sig at October 25, 2008 06:26 AM (QBXJR)

4 Will wrote: Honestly airfocemilf? Honestly? You realize that Starship Troopers was a satire of facism... right..? Nope. Heinlein wrote it mainly to write a story about the PBI, the Poor Bloody Infantry. Maybe it would help to read the book and essays he wrote about it. Though honestly, I think the government in the novel is practical only via author fiat. It is a bit obvious from the origin given for the Federation in the novel. The movie was written by people who didn't bother to let what was actually in the novel get in the way of their preconceived notions. Hey, like you!

Posted by: Patrick Chester at October 25, 2008 07:52 AM (MOvul)

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