I try not to post things I haven't substantiated in detail, but this one came across my desk today and bears watching.  http://www.youtube.com/watch?v=cMnSp4qEXNM&NR=1  This is a news show that supposedly has been taken off youtube in the US but is still up in Canada.  It seems popular lately to blame the Fannie Mae problem on the Bush regime.  I've thought that ridiculous all along, and this little 4 minute video offers excellent perspective.  No one is innocent in Washington, but this at least puts the majority of blame where it should rightfully fall I believe.

Who's Gonna Pay?

If you're an old timer like me you probably grew up thinking that everyone paid income taxes. I know I always did, even when I was just barely scraping by if at all. As the years and decades went by, there were lots of changes to the tax code. I remember thinking that college tuition should be deductible when I was trying to pay that and feed my family. Back then it wasn't. It is now. Probably that's an improvement. Let's talk about the other “credits” though.  

We all know that this country has a “graduated” income tax. That means that the wealthier tax payer pays a much higher share of the burden. Now most people would think that if you make twice as much money you pay twice as much taxes and that's probably fair. For instance, if you have three children and you make $107,498 you pay $9886 in taxes. Seems fair, doesn't it?

Suppose you only make half as much, that would be $53,749 – still a respectable income here in Florida. So you should pay half the taxes, right? That would be $4943 in taxes. Guess what. If you make $53,749 and you are married with 3 children you don't pay ANYTHING AT ALL!! In fact, you get $4 in free money from the IRS! Now $50k isn't wealthy I suppose, but it seems enough that you should be paying some tax, doesn't it? 

In 2007, the census bureau tells us that the median family income in the US was $50,233.00. So the average American family doesn't pay any tax at all? Yes, that's a bit over simplified. If you have less than 3 children and you make the average income of $50k you will pay a little tax. Maybe. All the numbers I'm quoting here consider ONLY Earned Income Credit and Child Tax Credit. These are all standard deduction. If you have any kind of deductions or other credits like child care or education you pay less taxes or can make more money without paying any taxes at all.  

Let's see now, if over half of the households in the USA don't pay any taxes then it's a pretty safe bet that over half the voters don't pay any. Perhaps this is relevant to some of the voting patterns we are seeing lately. It has been a long standing tenet of democracy that every man gets one and only one vote. Perhaps it's time to consider the logic here. This is approaching the scenario of two wolves and a chicken voting on what's for dinner. Now you can hardly blame a man for voting for what's in his best interest. If you could vote to give yourself $10k in free money, wouldn't you do it? It's up to our elected officials to exercise common sense in fiscal issues. I'm afraid we can not count on them these days.  

So what's the solution? I don't know, do you?