Taxing The Rich; Two Views

Below are two letters to the editors of The Economist, reproduced in full from the 8 October 2011 issue.  While each comes at the tax question from different sides, I agree with both Sweeney and Shayer.  The ‘rich” have the lobbyists to make the tax code dance to their tune.  This is why the mortgage interest deduction will always be with us, among other giveaways to the middle and upper classes.

At the same time, it’s always been curious to me how charges of “class warfare” are always trump and unidirectional. It is always talk of increasing taxes that lead to this charge, rarely or never talk of increasing the burdens on those with lower incomes.  Is our denial of class differences that deep?  Yeah, we’re a “classless society” all right.  Any look at an income differential chart will show you otherwise.  Any discussion of where (or if) randomly selected kids are able to go to college will bear witness to the giant schism between the classes in America.   Being shocked, SHOCKED! at the use of “class warfare” simply works in the favor of the favored class.  It’s not a discussion people are comfortable having. Admitting to having classes, let alone having those classes “at war” is not what we aspire to, even though it’s very much where we are.

Read and ponder.

 

Taxing the rich

SIR – I believe I am classed as one of the wealthy in America, so I took a great interest in your leader on how to get the well-heeled to pay more tax (“Hunting the rich”, September 24th). You advocated a tax system that would make the top rates more equal on wages and capital, eliminate virtually all deductions and get rid of corporate taxes. This, you said, would allow for a much lower top rate of income tax and would actually reap more tax revenues from the rich. You appear to be arguing that I, as one of the rich, would prefer to see lower income-tax rates, and for this “benefit” would be willing to pay more money. What are you smoking?

I do not give a damn about tax rates. My entrepreneurial instincts are in no way discouraged by high marginal rates. But I do care about how much money I have to pay. I like my deductions, all perfectly legal, around which I have structured my life.

Yes, the tax system is unfair. The array of consumption and payroll taxes are regressive and result in the less well-off paying a higher proportion of their total income in taxes. And this will continue as long as we, the rich, can persuade the politicians who write tax laws, and who are also part of the monied class, to structure the tax system to indulge us.

What is there not to like?

Anthony Sweeney
Darien, Connecticut

SIR – Why is it called “class warfare” to advocate raising taxes on the rich, but not when it comes to cutting benefits to the poor?

David Shayer
Palo Alto, California

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