Does the Government really own everything?
Is my net income just a "tax expenditure" that a forbearant omnipotent government allows me to foolishly waste on my own tawdry desires?
It seems that many people would answer that question with a resounding yes!
In a long article on the costs of philanthropy Stephanie Strom writes:
The rich are giving more to charity than ever, but people like Mr. Broad are not the only ones footing the bill for such generosity. For every three dollars they give away, the federal government typically gives up a dollar or more in tax revenue, because of the charitable tax deduction and by not collecting estate taxes.
Strom says there is a growing debate over what philanthropy is achieving at a time when the wealthiest Americans control a rising share of the national income and, because of sharp cuts in personal taxes, give up less to government.
Then there is this pretty amazing statement:
A common perception of philanthropy is that one of its central purposes is to alleviate the suffering of society’s least fortunate and therefore promote greater equality, taking some of the burden off government. In exchange, the United States is one of a handful of countries to allow givers a tax deduction. In essence, the public is letting private individuals decide how to allocate money on their behalf.
So to summarize so far: (a) Philanthropy = lowering inequality, (b) too many rich people don't do the kind of philanthropy other people would like to force them to do, (c) all money belongs to the government, (d) rich people don't pay much in taxes, and (e) if we changed the tax system people would act exactly the same way, estates would continue to be the same size and the government would get a ton of new money that it would use effectively to reduce inequality so lets get a move on!
Is this a great country or what?
Labels: economic policy