About Government Handouts To The Rich

Government handouts to the rich are okay, but government entitlements for the poor are not. What hypocrisy!

We have our fact-checkers out working on this, but it seems to be common knowledge that rich Americans enjoy the perks that government hands out – earned income tax credits and the like – but cannot abide social welfare programs for less fortunate Americans. It’s okay for the government to bail out corporations, they say, but no bailouts for poor people; they can sink or swim!

Two Jews are walking in the park when a bird swoops down and plotz right on one guy’s head. He looks at his friend and says, “For the rich, they sing.”

I spent years with a famous Jewish comedian who tells that story with a heavy Yiddish accent. I’m not sure if he’s Republican or Democrat, but I think of that bit when I hear that a corporation is a person that accepts a helping handout from the government, while we plotz on the heads of the poor and middle class.

A person replied to one of my blogs recently, and lectured about our “rights” vs “responsibilities.” He objects to using his taxes to fund social welfare programs. He argued long and a bit loudly that government has no responsibility to help lift the poor out of poverty, but I think the founding fathers disagreed. I think the Constitution disagrees. I know Democrats disagree. I used to think Christians disagreed.

Republicans don’t hate poor people; we know that. They may not invite them to dinner, and I seriously doubt the Tea Party has plans to vote for any of Obama’s social programs, but, while they are drinking the tea, while they are saying “no thanks” to anything proposed on the left side of the isle, perhaps they should re-read the Constitution. And ask, What would Jesus do?

Yes, I’m an atheist, a skeptic, a Democrat, and a fortunate recipient of our government’s largess: the G.I Bill, homeowners’ tax credits, unemployment insurance, and more. And I expect I’ll be paying higher taxes in the future. But look what I’m getting for my money: I am an American.

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Jac Flanders December 02, 2012 at 05:30 PM
Thank you for your thoughtfully considered opinion. At times, I must admit, I agree with you, especially after a hurried and less than well thought out blog, in which your assessment is well founded. I appreciate your warm feelings, and return them in the warmest, most sincere hope for your future. Although you have not identified yourself, I think I know you – I may see you in church Sunday.
Jac Flanders December 02, 2012 at 06:42 PM
Where, oh where, is Bret when we need him? We don't hate the rich, more power to them (well, maybe not more power). We are suggesting there’s an imbalance, an immoral favoritism by the Tea Party at least, that promotes entitlements for the wealthy, and denigrates “social” programs for the poor and middle class. The mostly white Tea Party frequently suggests that the more colorful poor are criminals and bums who refuse to work, while the wealthy create corporations and provide jobs for the rest of us slackers. They also complain that social programs are paid for, for the most part, with taxes “stolen” from the rich. Really? Bret may have the time and knowledge necessary to explain these fallacies.
Jay Berman December 02, 2012 at 11:42 PM
Come on Jac, that's talking points right out of Media Matters .. class and race warfare ... You know very little of the TEA (Taxed Enough Already) Party .. What exactly IS the middle class ??? Are our poor really "poor" ?? By global standards, most seem wealthy .. all relative ... our "poor" get free HUD section 8 housing or subsidized "affordable" housing .. they get Food Stamps and WIC, free medical and dental care, free cell phones, free child care, monthly cash assistance .. help with utility bills ... and much more .. as long as they have little or no income, have children and preferably no man in the house .. why work ? You get taken care of ... not worth taking a job ... so they work doing things for cash ... I'm all for a safety net, a hand up ... but to continuously raise taxes and go further in debt to keep this entitlement society going is just wrong. Being able to use your entitlements on the EBT card in a liquor store is wrong ... all of these programs need reform .. what "class" are you Jac ? I've never seen a dot or tattoo on folks showing what cast they are .. yet ..
Bret D. Rijke December 03, 2012 at 02:52 AM
@ Mr. Flanders Page 1: You wrote, “Where, oh where, is Bret when we need him?” Sorry! I had a “family day” with the wife and daughters. But I am not sure I could have helped much anyways, though of course I will try! You wrote, “We are suggesting there’s an imbalance, an immoral favoritism by the Tea Party at least, that promotes entitlements for the wealthy.” I would counter that there exist nothing immoral about anyone, regardless their monetary or social standing, with wanting to keep as much as they earn. I would actually state the reverse is true. That those who seek to take away from anyone a higher amount is committing the immoral act. Again, I would tie this into Dean Russell’s quote in the earlier post on this thread. And as for any “entitlement”, I think you have it backwards. How is it an entitlement when one who earns, say a million dollars, seeks to keep as much as possible by working within the existing system? Would not the “entitlement” actually exist on the part of someone who earned, say about 35 thousand, in trying to confiscate as much of the million as possible? That they or their elected representative feel an immoral right to the monies of others? Is that not the true immoral entitlement?
Bret D. Rijke December 03, 2012 at 02:52 AM
@ Mr. Flanders Page 2: You wrote, “…and denigrates “social” programs for the poor and middle class.” Again, this has little to do with the poor or middle class. It is a fundamental position in regards to a liberty based society as to how we view any person’s income. If the millionaire’s money is not safe from the “public looters”, then how can my pittance be safe? You wrote, “The mostly white Tea Party frequently suggests that the more colorful poor are criminals and bums who refuse to work…” Yes, it is very true, though not damning that the Tea Party is comprised of a majority White percentage. But if you attempt to single this out as some racial menace, then you must take the same stance with close to 95% of all Blacks voting for Obama. Or the Hispanics who vote 70%+ for the Democrats. Or of the high percentage of Jewish voters consistently voting for the Progressive candidate. For if we are going to say it is okay for one or more racial groups to vote overwhelmingly for a distinct set of policies and race, then the same standard applies for all in regards to race.
Bret D. Rijke December 03, 2012 at 02:53 AM
@ Mr. Flanders Page 3: You wrote, “They also complain that social programs are paid for, for the most part, with taxes “stolen” from the rich.” Again, my view is that a tax is legalized plunder and theft. Especially when the funds collected are utilized in functions not essential to the securing and retention of the populace’s liberties. And In a great many instances are used to promote programs and issues which are violently against what many of those “millionaires” hold near and dear. Here is a great quote from the late Joseph Sobran. “The State gives you two options. If you won’t be its dependent, you must pay taxes to support those who are. Living off others’ taxes is legitimate; refusing to pay those taxes is criminal.” So with that in mind, I would propose at least in regards to the Federal apparatus, an abolishment of the income tax. Institute instead a usage tax, or a national sales tax. Only 45% of Federal tax revenue is dependent on income tax anyway. The remaining 55% is made from other sources, like excise taxes, fees, and corporate taxes. This would force the Federal Government back into the role it was designed for; National Security, Foreign Relations, and staying out of Domestic issues.
Jac Flanders December 03, 2012 at 05:16 AM
Thank you guys, I knew you'd step in and explain our complicated tax system. You really are fun and extremely interesting. I promise to continue giving you opportunities, not that you need them, to promote views that seem to be helping Republicans loose elections. It may surprise you, but I also favor a flat tax - or some other formula to simplify the process of (government) funding infrastructure, jobs, etc. I just can't agree with you about your "thievery" theory.
Bret D. Rijke December 03, 2012 at 06:46 AM
@ Mr. Flanders; Page 1: But you really haven’t proved anything besides the majority of the vote (and barely at that) is in collusion with you in regards to how you view taxation, no matter the moral versus immoral applications. You make the blanket statement as to greed on the part of the wealthy for wanting to keep their money, but you then exempt yourself from the same indictment for wanting their money. I have written pages proving that the most informative thinkers and political philosophers who either played a part or helped shape those who did, viewed the power to tax as a necessary evil and one that should only extend to the preservation of liberty. But your repartee is you do not view it as theft, all the while ignoring, or not addressing the word for word definition as spoken by the “heavy hitters”. Oh yes, you alluded to your “thinking” that our Founding Fathers and the Constitution would want to fund social programs, but again, I think the volume of known literature roundly defeats that assumption. And when addressing the confiscation of anyone’s property by government, we’d better be damn well sure we have more on our side than “we think” they would want that.
Bret D. Rijke December 03, 2012 at 06:47 AM
@ Mr. Flanders; Page 2: You imply a racist overtone to the Tea Party, while excusing the same behavior by Blacks and Hispanics by your neglecting to hold them to the same standard. So you tell me, why is it racist for one group to want to keep their money, but not for another group to want to take their money? Because no matter how you dress it up with nobility and equality, logic and reason shows the earned income being re-distributed to someone who hasn’t earned it. Really you haven’t proved anything. Your last sentiment was one of immense enjoyment at allowing us “prove why we keep losing elections”, as if you had captured two scorpions and upon placing them in a bottle, gleefully watch them fight for your amusement. And when you ascribe the false commendation for explaining a complicated tax code, you forget you never asked for any explanation of any tax code. You asked about why we object to increasing taxes for the purpose of redistributing them, and I gave you ample and in-depth morality as to the repugnancy of our current taxes. Is it not a damning indictment also of taxation that the laws and regulation of taxes dwarf “War and Peace” in their numeric totality?
Bret D. Rijke December 03, 2012 at 06:48 AM
@ Mr. Flanders; Page 3: And your introduction of a flat tax has been repudiated by your own party as unfair also. This really speaks volumes as to how they view fairness. For what could be more equitable than every man paying the same exact percentage, assuming it is even possible to attribute fairness with the income tax. Contrary to your last post, I think the weight of the argument should fall heavily upon the Progressives to prove why increasing taxation for the purpose of social engineering and forced equality is constitutionally permissive or desired. I feel it is of paramount importance that those seeking to take from those who have, prove beyond a shadow of a doubt the validity and claimed moralistic prerogatives employed for such action. For if you cannot, then how can you call it anything but theft?
Jac Flanders December 04, 2012 at 12:17 AM
Bret - I have already said, several times in previous blogs, that I have no hope or intention of trying to convert anyone from their fundamentalist beliefs, religious or political. While you have every right to argue your points, a debate is not on my agenda, although I do sometimes fail to resist the urge. I would like to share a glass with other progressives, as you like to call us, and hope a few will reply to my blogs without giving or expecting a lecture in return. But, do continue, please, to fact-check and offer your opinions.
TVOR December 04, 2012 at 12:39 AM
I don't think its fair to begrudge the wealthy their riches. I also don't think they should shoulder a larger burden simply because they have more money. I think the only fair way to do taxes is as a consumption or sales tax. That way everyone pays according to what they consume, no tax breaks. We could save our taxpayers billions bt getting rid of teh IRS and numerous government agencies. There would, of course, have to reasonable limits set that could not be altered by future lawmakers. Maybe one day I will join the ranks of the wealthy (I sure friggin hope so) but until then I won't gripe about how much taxes they pay.
MFriedrich December 04, 2012 at 01:20 AM
Small businesses too were thrown into the argument as "job creators". Few seem unwilling to divorce "small business" from "wealthy" in this argument, even though the majority of SBs are never ever profitable and usually fail (80%). Statistically, small businesses do create more jobs, but typically between years 0 and 3. During these formative years SBs are unprofitable due to start up investment costs, strategy adjustments, learning curve, etc. Interestingly by year 5 most small businesses become net job destroyers. This is normal, as economies of scale change and the need to zero in on profit becomes critical. Small businesses do receive huge tax breaks (handouts) to compensate them for taking on business risks. Some of the "handouts", like the 2002 accelerated depreciation bonus provisions are ridiculous. However, this is completely different from "handouts" given to people who lost their jobs or who are poor as a result of economic misfortune, poor judgement or poor education. When you can afford to do it, there are very good reasons to do both.
Jay Berman December 04, 2012 at 01:25 AM
If what you say is true, there would be very few small businesses .... you are simply wrong ... all businesses get tax deductions and credits as we have the highest corporate taxes in the world at 35% ... Small businesses are the engine of innovation in this country and employ the most people ...
Gregory Brittain December 04, 2012 at 02:14 AM
Letting people keep more of their money, is not a handout. The tax rate is not a "handout." Otherwise, any rate less than 100% would be a "handout." I do not know the details of those tax breaks, and I suspect neither do you, but none are "handouts." Businesses are taxed on net income. i.e. they get to deduct their business expenses. Obama specializes in actual handouts to his crony capitalist supporters like the Solyndra.
Gregory Brittain December 04, 2012 at 02:17 AM
Keeping more you the money you earn is not "receiving" taxpayer dollars. Only a Dem statist would view all money as the government's money, and the government decides how much each person gets.
MFriedrich December 04, 2012 at 02:24 AM
Yes Jay, But it's actually 39.2%, not 35%. Japan will lower theirs to 36.8% in April, so the US will be #1 in the world in corp. tax rates. You are mistaken if you think that the majority of small business owners in the US are burdened high corporate tax rates. Most US SB owners report profits on individual tax returns to avoid paying corporate income tax rates. Economic research shows that SBs play no greater role in "creating jobs" than medium or large businesses do: http://www.nber.org/papers/w13818.pdf. This is the problem with political talking points and the media. Just because people are saying it over and over again, doesn't make it the truth. By the way, I'm not against subsidizing SBs. The German economy is the strongest in Europe right now precisely because of it's "Mittelstand", a swelling rank of small businesses. Their corporate tax rate is higher than many other European countries. This doesn't not impede their progress. Let's also not discard an important contributor to innovation in this country: taxpayer funded, federal govt grants for research and development. Many industries are basically alive because of these "handouts". Government funds well spent have an obvious multiplier effect for an economy. Government funds poorly spent (FHA loans, foreclosure prevention) can have the opposite effect. So not all handouts are equal. And with 80% SB failures on avg, clearly most investments in that realm are bad ones.
Gregory Brittain December 04, 2012 at 02:34 AM
Mr. Flanders, you are on to something with flat tax, which Brown advocated when he ran for president. Reasons for a flat tax: 1st. The personal income tax raises ~$1.2 trillion. Compliance costs are $3-400 billion. 2nd. The complicated tax code distorts economic decisions and causes economic inefficiency. People make tax decisions not business and economic decisions. 3rd. Flat tax systems contributed to economic growth in Russia and Eastern European counties. 4th. Lower rates increase the incentives for work, savings and investment. Depending on what if any deductions are kept, beyond a zero tax bracket, the rate could be 13%-20% and raise the same tax revenue without considering increased growth and jobs. A flat tax that raises the same revenue with a static analysis will increase growth, jobs and tax revenue. More people are willing to risk their money and work 80+ hours per week if they get to keep 80% of their money compared to 60%. 5th. The complicated tax code with numerous deductions and tax breaks undermines respect for and confidence in the system. 6th. Russia found that with lower rates, there was more compliance. People who evaded taxes at higher rates, voluntarily paid the lower rates. 7th. Companies and interest groups lobby congress and make campaign contributions to get and keep special tax breaks. A flat tax takes that away, and takes power over the economy and our lives out of Washington.
Gregory Brittain December 04, 2012 at 02:35 AM
BTW. in California, we could replace the income tax, sales tax and property tax with a 5.8% flat tax, raise the same amount of revenue (without counting increased growth and jobs) and dramatically improve the business climate and create more jobs and tax revenue. http://www.foxandhoundsdaily.com/2012/04/dr-laffers-rx-for-californias-economy/
Jay Berman December 04, 2012 at 02:35 AM
Never said all small businesses report as corps, many do. I am a small business, very small today due to lousy economy, I deal with mainly restaurants and see how this will hurt them .. I don't know of any subsidies for SB .. where are mine ? I do know of tax deductions and some credits - businesses pay tax on NET profit ... if its an LLC or S Corp it is personal .. the simple fact is our tax system is horribly corrupt and inefficient. It is designed so politicians can dole out favorable tax treatment to their "friends" ... SB DOES play a MAJOR role in job creation .. http://www.businessweek.com/articles/2012-04-26/small-business-job-creation-is-stronger-than-we-think I am against just about all government handouts .. most are gifts to contributors .. see Solyndra (and many others) .. the government should get out of the way, we need to get back to free market capitalism .. it is NOT the government's role to dole out taxpayer money to the private sector, let the private sector finance itself .. the only exceptions I can think of are NASA and DARPA .. If a company can't make it on their own, they should be allowed to fail, no bailouts ...
Gregory Brittain December 04, 2012 at 02:40 AM
Mr. Rijke, If I may suggest, few people are going to read so much densely packed text. You spent a lot time writing your post. I suggest writing less, covering fewer subjects in each post, and including more space, e.g. a blank line between paragraphs. No matter how brilliant and well reasoned your writing is, it does not do any good if people don't read it.
Jay Berman December 04, 2012 at 02:44 AM
15% all income over $15,000 regardless of source .. you can give 10% of your tax burden to a charity or non profit. Businesses 15% of net profit, same 10% for charity or non profit .. and a 5% national sales tax on tangibles except food and fuel. It would take 3/4's majority in both houses to modify this law .... fair, simple .. California ? Forget it ... done, stick a fork in it ... such a shame too, we have such resources, such energy resources that go untapped ... we can't build anything here anymore ... businesses are folding up operations here and leaving ... going to places like Texas where the cost of living is about 30% less than here ... Apple is opening a large facility in Austin and Reno ... Campbells just folded a plant in the central valley ... cost too much to operate here .... many, many stories like this ... from the Golden State to the Welfare State ... Jerry Brown started the downfall over 30 years ago and now is here to finish the job ..
MFriedrich December 04, 2012 at 03:01 AM
Jay, you and I are in agreement on laissez-faire capitalism. We may differ on the degree of government intervention that is appropriate. I agree with your view that most regulations on US business are unintelligible and should be scrapped or re-drafted, particularly tax laws. I hear the statement "government getting out of the way" all the time. I agree with this to a point. There are good reasons why we typically don't find plastic resins in baby formula, or why we have smoke and flame retardant powder in all major electric cabling. And it's not because American businesses have been exceptionally good at regulating themselves. I agree with the "let them fail" philosophy, as painful as that may be, and that it should be applied broadly to end consumers as well. Over the longer term, other investors, buyers and businesses come in, take over and economic recoveries are 100 fold faster and greater. This point is made never clearer than in the housing market right now, where mortgage default rates on modified loans (govt program) are 75%. They said the entire economy would have collapsed if the big 5 banks would have failed. It would have been temporary. Over the medium and longer term, other banks would have stepped in and served the demand. The malinvesting losers would have lost and markets would have adjusted. Now we have winners losing and losers winning. On top of it all, we have a central bank with no authority driving up hidden taxes to fund govt debt.
Jay Berman December 04, 2012 at 03:19 AM
Some regulation is needed, but for the most part, companies don't want to create dangerous products or harm the environment ... sure, there are always some bad apples, they need to be dealt with. One of the biggest mistakes the country made was to allow companies like banks and energy companies to merge and become massive companies that control such a huge market share. Just the thought - too big to fail is insanity. We need to bring back a form of the Glass / Stiegel act .. banks should only be allowed to specialize in particular areas such as retail, investment, brokerage .. none should be able to sell insurance and market share should be limited ... today, there is very little competition - small banks and credit unions "bank" with these massive banks - they control too much. Same with oil .... 5 companies control most of the oil ... if you drill and explore, you shouldn't refine or retail . something like that ... there will be no new competition in these industries because how can anyone put together a business to compete with them ? Too big to exist ...
Walter December 04, 2012 at 03:22 AM
Jac, Recent income inequality expansion is caused by Federal Reserve easy money, and corrupt crony capitalism. http://www.wcvarones.com/2011/01/robert-shiller-on-rising-inequality-in.html Taxing the last few honest entrepreneurs to try to remedy what is a systemic government corruption problem will not work.
Jay Berman December 04, 2012 at 03:25 AM
Other companies that are too big ... ConAgra, ADM .. control most of our food supply .. any commodity needs to be regulated to ensure healthy competition .. trading things like electricity is a fraud, you can't hold it or store it - how can you have a supply / demand market in that ? If you buy a commodity contract, you need to take possession - otherwise you are just manipulating the market and the consumer always pays ... There are enough equities to trade or places to gamble ...
Jay Berman December 04, 2012 at 03:27 AM
WC .. Income equality is a Marxist thing .. no room for it in the United States where you are free to excel and make all you want - or as little. There are no equal outcomes ... work hard, get ahead ... good for you ... nothing is guaranteed ...
Gregory Brittain December 04, 2012 at 08:05 PM
Don’t say we didn’t warn you, #16 “It took the Internal Revenue Service (IRS) 159 pages to explain one new Obamacare tax on investments that will be used to pay for Obamacare.” http://www.breitbart.com/Big-Government/2012/12/04/IRS-Issues-159-Pages-Of-Obamacare-Rules
Gregory Brittain December 07, 2012 at 10:16 AM
As Ronald Reagan said “Well, the trouble with our liberal friends is not that they are ignorant, but that they know so much that isn’t so.” What entitlement programs did the founders adopt? I don't remember was it George Washington, John Adams or Thomas Jefferson that advocated adopting an income tax on the top 1%? What entitlement programs and tax increases did Jesus advocate?
Gregory Brittain December 08, 2012 at 06:32 PM
Don’t say we didn’t warn you, #17 Brown’s and the Dems’ tax increase is retroactive to January 1, 2012. Passage of Proposition 30 set off euphoria and expectations of higher spending for public employees. The California Teachers’ Association (CTA) trumpeted: ‘California students and working families won a clear victory today as voters clearly demonstrated their willingness to invest in our public schools and colleges and also rejected a deceptive ballot measure aimed at silencing educators, other workers and their unions.’” But, don’t spend the money quite yet. “California State Controller John Chiang has announced that total state revenue for the month of November 2012 fell $806.8 million, or 10.8%, below budget.” “Democrats thought they could hammer ‘the rich’ by convincing voters to pass Proposition 30 to create the highest state income tax in the nation. But it now appears that high income earners have already ‘voted with their feet’ by moving themselves and their businesses out of state, resulting in over $1 billion shortfall in corporate and income taxes last month and the beginning of a new financial crisis.” http://www.breitbart.com/Big-Government/2012/12/07/CALIFORNIA-STATE-BUDGET-GOES-OFF-THE-CLIFF Let’s all watch and learn from the effects of CA having by far the highest state income tax rates in America.


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