A Fair Point
Today's New York Times raises some good questions about Bush's "ownership society."
The benefits of ownership, and thus having some sort of property, have been discussed at length by conservatives. If you own something, you take responsibility for it, and you have something to lose. When you have something to risk, others are willing to extend you credit. Businesses are created, etc.
The Times' take on "ownership" society relates to encouraging savings. They predict taxes on savings and investment income to diminish or disappear. Given that many of the wealthiest people in America make their money in investment income, this could be a huge boon to the wealthy. Income taxes will become predominantly "wage taxes" and those taxes would be borne far less by the rich.
I'm no egalitarian. I believe the rich have a right to their money. But they should pay their share. Take John Edwards. He created an S Corporation with himself as CEO, and payed himself a $300,000 salary on millions in income. As the corporation's sole shareholder, he booked the rest of his millions as dividends. This is currently beneficial in that no Medicare taxes are taken out of dividends. Should income taxes on investments and savings be cut severely, Edwards and others who take most of their income outside of a "salary" stand to profit handsomely.
Given Bush's stated goals of simplifying the tax code, it does not seem that policies which would promote loophole exploitation are what he's targeting. The Times hints at a consumption tax, which would encourage saving and discourage spending. The analysis I've read makes me believe this is unworkable as a substitute for an income tax, and my fear is such a tax might be implemented in addition to an income tax.
Low tax rates across the board are incentive enough to spur investment and growth. Policies that benefit the rich disproportionately and skew the tax base will only give ammunition to critics who view Republicans as the party of the privileged.
The benefits of ownership, and thus having some sort of property, have been discussed at length by conservatives. If you own something, you take responsibility for it, and you have something to lose. When you have something to risk, others are willing to extend you credit. Businesses are created, etc.
The Times' take on "ownership" society relates to encouraging savings. They predict taxes on savings and investment income to diminish or disappear. Given that many of the wealthiest people in America make their money in investment income, this could be a huge boon to the wealthy. Income taxes will become predominantly "wage taxes" and those taxes would be borne far less by the rich.
I'm no egalitarian. I believe the rich have a right to their money. But they should pay their share. Take John Edwards. He created an S Corporation with himself as CEO, and payed himself a $300,000 salary on millions in income. As the corporation's sole shareholder, he booked the rest of his millions as dividends. This is currently beneficial in that no Medicare taxes are taken out of dividends. Should income taxes on investments and savings be cut severely, Edwards and others who take most of their income outside of a "salary" stand to profit handsomely.
Given Bush's stated goals of simplifying the tax code, it does not seem that policies which would promote loophole exploitation are what he's targeting. The Times hints at a consumption tax, which would encourage saving and discourage spending. The analysis I've read makes me believe this is unworkable as a substitute for an income tax, and my fear is such a tax might be implemented in addition to an income tax.
Low tax rates across the board are incentive enough to spur investment and growth. Policies that benefit the rich disproportionately and skew the tax base will only give ammunition to critics who view Republicans as the party of the privileged.