Taxes, debt are behind decline of U.S. - East Valley Tribune: Opinion

Taxes, debt are behind decline of U.S.

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Posted: Wednesday, May 20, 2009 6:18 pm | Updated: 12:46 am, Sat Oct 8, 2011.

Robert L. Hale: Thirty-eight state budgets are in the red. The Government Accountability Office estimates that federal debt, on a per-household basis, is between $299,880 and $754,095. The difference is based on whether all households are counted or just those that pay income taxes. The GAO points out that the debt is the result of entitlements and unrestrained government spending.

Without dramatic and immediate reform, our country will cease to exist as we know it. Successful reform requires abolishing entitlements, reducing the size of government, and imposing fiscal restraints on its spending. 

For anyone seeking a timely history lesson, Charles Adams’ “For Good and Evil — the Impact of Taxes on the Course of Civilization” is a must read. Adams points out that good tax systems go bad unless citizens are able to restrain their governments. History demonstrates that destructive taxation has ended more civilizations than wars and all other causes combined.

Thirty-eight state budgets are in the red. The Government Accountability Office estimates that federal debt, on a per-household basis, is between $299,880 and $754,095. The difference is based on whether all households are counted or just those that pay income taxes. The GAO points out that the debt is the result of entitlements and unrestrained government spending.

Without dramatic and immediate reform, our country will cease to exist as we know it. Successful reform requires abolishing entitlements, reducing the size of government, and imposing fiscal restraints on its spending.

“The prosperity as well as the decline of nations has always had a tax factor; whatever the tax man wants, the tax man gets, including our liberty, should he so desire,” notes Adams. He points out, “The first warning phase of rebellion is rampant tax evasion and flight to avoid tax; the second phase produces riots; and the third phase is violence.” Of course, it cannot happen to us! But it will.

Speaking of “evasion,” the Obama administration recently announced a “far-reaching crackdown on offshore tax avoidance.” The focus of the “crackdown” and — in fact, the major focus of the new administration’s fiscal policy — is not on spending reform. It is on how government can get more of what we earn. In short, the focus is on government spending more.

The “tax reform” effort is draped in the rhetoric of “stopping tax abuse.” The description is ironic. There is indeed tax abuse. However, the abuse is not in seeking to keep more of what is earned; the abuse is in a tax system honed to take as much of what others earn as possible. The takers seem outraged and frustrated that people who work hard want to keep what they earn. Earners who balk at higher and higher taxation are chided as “greedy.”

The true greed is not found in those who seek to keep what is theirs but rather in those who seek to take what belongs to someone else. Our political and education systems have succeeded in twisting words to mean exactly the opposite of what they really are. Aldous Huxley’s “Brave New World” and George Orwell’s “1984” are here — 25 years later than predicted but nonetheless here.

Greed is the basis of taxation in America. At its most vile, ever-increasing taxation of fewer and fewer taxpayers is the ultimate definition of greed. U.S. taxation long ago ceased funding fundamental services that benefit the community at large. Today, the vast majority of all government spending is used to buy and keep political power.

Governments do not create wealth or prosperity. They take and spend it. When the “taking” is used to benefit the community at large, the result promotes prosperity. When a tax system strips away the capital needed by those who actually create jobs, goods, and services, then prosperity sputters, chokes, and disappears.

Bank robbers rob banks because that is where the money is. Similarly, governments tax the producers because that is where the money is. What seems to escape the tax man’s thinking is why the producers have money. And even less understood is that producers are generally astute.

When the reward imposed by government for hard work and success is an ever-increasing tax burden, producers will do one of two things — stop producing or seek ways to keep what has been earned. Politicians call the latter greed and tax avoidance; history demonstrates the former is the decline of civilization.

America is in decline, following in the destructive taxing footsteps of history’s great civilizations. Is there anyone that can lead us away from our impending decline? We will find out.

Robert L. Hale of Minot, N.D., is founder and director of a nonprofit public interest law firm. Reprinted with permission by Hale and the Fitzgerald Griffin Foundation at www.fgfBooks.com. All rights reserved.

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