Tuesday, July 17, 2012

A Level Playing Field

I haven’t put thoughts to computer on here in quite a while, a shame. I’ve had a lot to say at times, just never felt the urge to put it on the blog. However, Obama has done it this time.

He’s truly inspired me to sit down and destroy something he said last Friday. Real Clear Politics has the video and text. Here’s the part that has conservatives and Twitchy and small business owners steamed (emphasis mine):
“[L]ook, if you’ve been successful, you didn’t get there on your own. You didn’t get there on your own. I’m always struck by people who think, well, it must be because I was just so smart. There are a lot of smart people out there. It must be because I worked harder than everybody else. Let me tell you something — there are a whole bunch of hardworking people out there. (Applause.)  
If you were successful, somebody along the line gave you some help. There was a great teacher somewhere in your life. Somebody helped to create this unbelievable American system that we have that allowed you to thrive. Somebody invested in roads and bridges. If you’ve got a business — you didn’t build that. Somebody else made that happen.”
Somebody else made that happen? Question for our President who has never owned a business or met a payroll: How did government get the money to do the things he mentions? Is it manufactured from thin air? No, businesses grew up and hired people and with the passage of the 16th Amendment to the US Constitution started collecting taxes on those people. Up until the 1900s roads were built by businesses. Toll roads were built and run by private companies. Most of the railroad infrastructure in this country was built by private entities.

I understand the argument some could make, that business makes use of “public” facilities and services to succeed. But business also provides the VAST majority of the money used to create those facilities. The poor person paying only one dollar for that bus ride is having that ride subsidized by the middle class and wealthy who pay taxes, since almost all mass-transit systems are money losers without subsidies.

Other than the circular nature of the argument, that business uses public facilities but business pays the lion’s share of taxes to pay for those public facilities that they then use . . ., there is another problem with it: the playing field is level. Regardless of how much help the government provides or how much regulation headwind they put in the way, everybody SHOULD face the same obstacles as everybody else to starting a business. They don’t because of crony capitalism, like the green energy cronies Obama’s been wasting our money on. The government also too often picks winners and losers. I digress, all that is for another posting.

Many argue that liberals as left as Obama and the people around him believe that all money people earn, 100% of it, belongs to “society” or government and the government generously lets you keep some of it.

It ignores that most people who make “rich” level of money, whatever the moving target is, did work harder, get more schooling, and prove themselves to make themselves worth that much to a company. Are there a few that got there with nepotism or unethical behavior? Absolutely, there are bad bananas in every bunch, but that doesn’t diminish the fact that people distinguish themselves and make more money through their own hard work. A truly free country recognizes that whatever a person earns, by what they do to distinguish themselves, is THEIRS, not the government’s. If you can’t go out and take out a second mortgage, burn your life savings and put in 80, 90 or more hours a week building a business and expect to keep most of the fruits of that labor, why do it?

The government’s job is to make sure it’s a level playing field and get out of the way. The government should be enforcing contract law and create recourse for a company killing or injuring people through its behavior. That’s it.

He uses the example of teachers. Let me use school to illustrate the level playing field and unequal levels of success argument. Suppose there are ten kids who travel start in the same elementary school and stay together through high school. They have the same curriculum, access to the same classes once they are elective, and the same opportunity to study. At graduation two of the kids are valedictorians, but only one of those two took honors and AP classes. The AP student is going Ivy league, the other valedictorian is going “second tier.” Five of the others did average, C’s and B’s, and are going to community or public colleges. Three more didn’t focus, didn’t work hard and will be working minimum wage jobs for the foreseeable future.

Did the top two students “not get their on their own”? Did “somebody else make it happen”? No, obviously they worked harder, studied harder, were probably smarter and made choices about which classes to take. Like a business owner, they made the extra effort. Bill Gates and his friends purchased DOS from DRI and stuck it to Apple and IBM, but they started with just that $50,000. Hewlett-Packard started with two guys in their garage. Oil companies started with some back breaking work and luck.

What Obama is saying is that the people who worked hard, made the right choices in school, and took advantage of the opportunities in front of them should pay more to provide welfare to the people who didn’t. I believe we should take care of those who CAN’T take care of themselves, through private charity, not government. Obama believes that you shouldn’t even have to try to find work if you're on welfare.

The tax changes Obama is proposing, increasing the highest rates from 35% to 39.5%, on top of the increase in investment taxes from Obamacare in 2013, would increase the tax burden by 10% for the investors and job creators. It would increase government revenue, at most assuming the rich didn’t find other ways to protect their income, by $82.9 Billion dollars a year, 0.5% of the current annual deficit. Yet we have zero White House proposals to reduce the cost of Medicare, get Social Security under control, or to respond to the GAO report that over 120 government functions are redundant. Obama’s budgets have all gone down almost unanimously, including Democrat votes, but they ALL kept spending at current levels and deficits right where they are.
According to the Tax Foundation in an October 2011 report, “The top 5 percent earned 31.7 percent of the nation’s adjusted gross income, but paid approximately 58.7 percent of federal individual income taxes.” In short, most taxes for non-retirement social spending – the same social spending liberals are so keen on expanding – are being paid by those people liberals also say don’t pay enough in taxes – the top five percent, whose income was a relatively modest $154,643,000 in 2009, according to the Tax Foundation.
He shouldn’t be demonizing the rich for political gain. He should be thanking them for providing the money for that infrastructure . . . and all of our social programs.

The Declaration of Independence proclaims "pursuit of happiness," not happiness. Our country should provide equal opportunity, not try to force equal results.