By Farther Steps

Reformed and Reforming, semper reformanda to Christ's glory.

Posts Tagged ‘Taxes’

Not the Semblance of Authority

One day in the House of Representatives, a bill was taken up appropriating money for the benefit of a widow of a distinguished naval officer. Several beautiful speeches had been made in its support. The Speaker was just about to put the question when Colonel David Crockett arose:

Mr. Speaker–I have as much respect for the memory of the deceased, and as much sympathy for the sufferings of the living, if suffering there be, as any man in this House, but we must not permit our respect for the dead or our sympathy for a part of the living to lead us into an act of injustice to the balance of the living. I will not go into an argument to prove that Congress has no power to appropriate this money as an act of charity. Every member upon this floor knows it. We have the right, as individuals, to give away as much of our own money as we please in charity; but as members of Congress we have no right so to appropriate a dollar of the public money. Some eloquent appeals have been made to us upon the ground that it is a debt due the deceased. Mr. Speaker, the deceased lived long after the close of the war; he was in office to the day of his death, and I have never heard that the government was in arrears to him.

Every man in this House knows it is not a debt. We cannot, without the grossest corruption, appropriate this money as the payment of a debt. We have not the semblance of authority to appropriate it as a charity. Mr. Speaker, I have said we have the right to give as much money of our own as we please. I am the poorest man on this floor. I cannot vote for this bill, but I will give one week’s pay to the object, and if every member of Congress will do the same, it will amount to more than the bill asks.

He took his seat. Nobody replied. The bill was put upon its passage, and, instead of passing unanimously, as was generally supposed, and as, no doubt, it would, but for that speech, it received but few votes, and, of course, was lost.

(Source: Not Yours to Give)

Morning Politics

Did you hear that Bank of America want’s to start charging $5 per month for its members to use a debit card? Sounds outrageous doesn’t it? President Obama waived the consumer finance protection bureau stick in the direction of BofA during an interview at ABC. I have to admit, I’m kind of cheesed about that fee but I really don’t think government regulation is the answer. I like what Dick Durbin said, “Bank of America customers, vote with your feet. Get the heck out of that bank. Find yourself a bank or credit union that won’t gouge you for $5 a month and still will give you a debit card that you can use every single day.” Government isn’t the answer to everything.

You know what is really kind of odd? The reason BofA is implementing the fee is because their other revenue source on debit cards has been throttled so they’re seeking money elsewhere. Those debit cards don’t operate for free. There is a nation-wide secure computer network that supports them and someone has to pay for it. So who throttled what? The 2010 Dodd-Frank law included a provision that cut the “swipe fees” that debit-card issuers charge merchants. That means the banks were restricted in how much they could charge stores on each transaction. And who authored this restriction? Neither Frank nor Dodd. It was none other than Dick “These Shoes are Made for Walkin'” Durbin. I wish he’d have heard his own philosophy when he authored that amendment in the first place.

In somewhat tangentially related news (both touch Wall St.) a liberal talking head on some radio station said that it is “media crime” that Fox and CNN are interviewing less articulate Wall St. protestors. Apparently it is okay to find the most red neck Tea Party supporter but if you do the same for the Occupy Wall Street group, that’s bad.

Finally, President Obama wants to increase taxes on couples who have more than $250k in taxable income. The Democrats don’t like that and would rather institute a 5% surtax on those who have $1 million in income after all the deductions. Why the disagreement? NPR summed it up:

The disagreement in their ranks arises partly from how the president proposes to pay for his plan, an approach seen by some senators as potentially making their already difficult path to re-election even more so.

So let’s set aside for the moment that someone might not get reelected and ask what should be done here. The tax increases are both intended to pay for the president’s job stimulus package. The fact that Democrats want to actually pay for what their spending is a good sign but how do you do that in an economy as sluggish as ours? There are two things that have to happen: don’t raise taxes and don’t cut spending. The idea is that there needs to be as much money floating around the economy as possible at this point. Taking it out of people’s pockets and dumping it in a money black hole is a bad idea. The Republicans want to cut spending and the Democrats want to raise taxes in order to balance the budget. The truth of the matter is that we need to do the opposite of what both parties are banking on. We’re in trouble if they fail to get a collective clue.

Once the economy starts picking up, tax revenues will increase as more people go back to work and start buying more stuff. Once tax revenues start increasing we need to do the opposite of what seems reasonable. Then we can start scaling back government spending and we can fiddle with taxes a bit. That seems counter-intuitive doesn’t it? We have more money coming in so we can spend more and since we have more money coming in we don’t need to mess with taxes, right? Wrong. Once the economy starts moving again that’s when the government has the leeway to reduce spending. The government doesn’t need to worry about upping their portion of spending into the economy, the people are able to do that. And when money is flowing we can start working on making taxes fair and equitable once again without the fear of causing those with money to hold on tighter to what they have.

But that kind of thinking won’t get you reelected. Isn’t soundbite worthy.