Redistribution of wealth

I overheard a disturbing story at the office today. A woman went out to dinner over the weekend, and noticed that the waiter was wearing an Obama tie. She didn’t say anything throughout the meal, but when it came time to pay the bill, she struck up a conversation.

“So, you’re a big Obama fan?”

“Sure am,” the waiter said. “Pretty much believe in everything he stands for.”

“Well,” the woman said, “Obama’s all for the redistribution of wealth, did you know that?”

“Uh,” the waiter said, confused as to where this was going.

The woman pulled out a ten dollar bill. “This is ten dollars,” she said. “I was going to give you this as a tip. You earned this. But instead, I’m going to give it to that guy outside.” She pointed to a guy sitting on a bench outside the restaurant.

“That’s not fair!” the waiter said.

“Hey, I agree,” said the woman, “but you said you agree with Obama, and this is what he’s trying to do.” She got up, leaving exactly the price of the bill itself, walked out the door and handed the ten dollar bill to the man on the bench.

Why am I telling you this story? Because as usual, it shows how the Republicans have it wrong. They’re ticked off because Obama’s talking about raising taxes on the rich (and corporations, which despite what the law implies, aren’t really people) while cutting taxes for everyone else. They see this as unfairly taking money from them, money they earned. And from their perspective, I can see how they’d feel that way. They’ve been allowed to be greedy for so long they’ve come to see it as normal.

Let me tell you a secret. All taxation is redistribution of wealth. Every dime the government collects from citizens gets given to someone else, be that as entitlements like Social Security or as payment for goods or services. The Republicans aren’t really upset at the idea of redistribution of wealth (except the Ayn Rand libertarians who see all taxation as evil), they’re upset at the prospect of the money flowing from them rather than to them, as it has during most of the last 30 years.

What Obama’s really suggesting is everyone paying their fair share. Those who have benefitted the most from America can afford to give more back to help other Americans up the ladder of success. Fair share doesn’t mean a flat tax, either. A 10% income tax hits a schoolteacher making $25k/yr a lot harder than a CEO making $10M/year. The schoolteacher would have to get by on $22,500, while the CEO would still have 9 million dollars. Progressive taxation is about giving back to the society that made your success possible proportionately to how much success you were able to achieve.

Really successful people, guys like Bill Gates and Warren Buffet, realize this. At the very least, the rich need to understand that if they end up with all the money, yay, they “win” but then there’s no one left that can afford to buy their goods. A strong middle class means the rich have a viable market to sell to.

But in the end, that’s not what this is about. I’m almost positive the woman in the story would actually see her taxes go down under Obama’s tax plan. She’d benefit from an Obama presidency, but she’s been duped by the noise machine of the super-wealthy into voting against her own best interests. She’s the real victim in the story. How many more Americans like her are out there? How many people have been fooled into thinking that the Republicans are looking out for them?

5 thoughts on “Redistribution of wealth”

  1. What puzzles me is if Obama raises taxes on corporations, how is that not actually raising the tax on all those corporations’ customers? Those corporations aren’t going to take higher taxes sitting down. They’re going to pass them on to consumers in the form of higher prices, so they don’t eat into their profit margin.

  2. The same global economy that allows American companies to move jobs overseas largely prevents this from happening. If newly-taxed American companies (the average middle class American household paid more in federal taxes last year than Pepsi) try to pass that cost on to their customers, they’ll be eaten alive by their foreign competition. The last thing Ford wants to do is make their cars even more expensive over the equivalent Toyota than they already are (see: why nationalized healthcare is good for business).

  3. We could also argue that capitalism is just as much redistribution of wealth as is socialism, the difference being whether the method that drives the redistribution is “free” market-oriented or “democratic” government mandate, and how the distribution is, well, distributed.

    I’m a child of the Cold War. Who would’ve thunk back then that socialist and capitalist principles could coexist simultaneously; but that’s just what’s happened in this post-Cold War era of Global Capitalism, where the goods of capitalism are manufactured in the People’s Republic of China.

    The first victim of Global Capitalism from the Cold War era was Communism; the next victim appears to be Democracy, in its truest sense. God help us.

Leave a Reply

Your email address will not be published. Required fields are marked *