The Rich Man, Poor Man’s Tax Debate

Letter to Romans: Milton Friedman once said all taxes should be lowered on everyone while Jeff Bezos said it’s “absurd” to impose any federal income tax on the bottom 50% of earners. Arguably, the late economist, not the Amazon founder, is most humane. Here’s why:

Not that billionaire Bezos didn’t articulate what’s been known but largely ignored by policy-makers for decades, that is, the “bottom half” earns about $50-$55K or less but makes up only about 3% of Uncle Sam’s total revenue. Naturally & rightly, he says, that monies lost is a pittance to the feds but can be a life-line to struggling folks or even give them a shot at saving for the future. Yet, what a filthy rich guy like Bezos might naturally overlook is the fact even his proposal is a drop in the bucket to the poor since they still get slammed by a bigger percentage of total payroll taxes like those covering Social Security & Medicare; nor does it take into account the real killers to a family aka ever-increasing state income taxes, sales taxes, property taxes & a plethora of other fees.

THAT is why Friedman long ago urged: “I am in favor of reducing taxes under any circumstances, for any excuse, with any reason whatsoever … because it’s the only you’re ever going to get effective control of government spending. Sooner or later, if you don’t reduce taxes to get rid of [an ever-increasing public debt, history shows] it’s going to be spent.” He concluded, all governments WILL spend “whatever they can raise, plus whatever they can get away with.” If true, eliminating the federal income tax on the poor as Bezos suggests will be at best only a relatively minor temporary relief and you can count on the spendthrift state & federal tax monsters to keep finding other ways to gobble up more of folks’ meager earnings. BTW: Who is best positioned to pay ANY tax? The poor? The middle class? The rich?

Davd Soul