Arthur Laffer’s flat tax: its pitfalls, inequality, and impediment to national prosperity.
There are a number of irrefutable problems with a federal tax which would tax everyone on their “income” by calculating the share using a fixed percentage.
The first problem encountered is a working definition of “ taxable income”. The current definition of “taxable income” is both arbitrary and capriciously invented from day to day by those who hold political power.
A tax calculated from “income” ___ which I imagine would include earnings realized by our productive members of society ___ is a tax under which government force is intentionally used in a fashion which forcefully penalizes and punishes our productive members of society for their productivity while it rewards the unproductive members of society by allowing them to escape from shouldering an equal burden in supporting the functions of our federal government.
An income tax imposed as a general tax among the States violates the Great Compromise made during the framing of our Constitution which commanded representation in Congress, but only with proportional obligation!.
The delinquency in enforcing this rule has encouraged members of Congress to use their vote to engage in reckless spending and borrowing, knowing full well they will not have to return home with a bill for their constituents to pay when spending exceeds revenue raised, in order to balance the budget.
In a nutshell, if Congress did not raise sufficient revenue from imposts and duties at our water’s edge, nor from internal “excise” taxes imposed upon “judiciously selected” articles of consumption, preferable articles of luxury, and found it necessary to borrow to meet its expenses, the deficit so created was to be extinguished using a general tax among the States that observed the rule of apportionment which predetermined each State’s share of a total sum being raised based each state’s population size.
This tax boils down to an equal per capita tax if the tax were laid directly upon the people! For example, if the tax were laid today and the people of New York each had to pay one dollar to meet its apportioned share of a total sum being raised by Congress, the people of Idaho would likewise only have to pay one dollar each if the tax were distributed evenly among the people living in Idaho. And, although New York’s total share of the tax would be far greater then that of Idaho because of New York’s larger population, we must remember New York is compensated by its larger representation in Congress when creating a deficit, which is also part of our Constitution’s fair share formula and commands representation with proportional obligation!
Under a “flat income tax” the people of those states who would be contributing the lion’s share of the tax would not be receiving their representation in Congress proportionately equal to their State’s contribution.
Socialists, “progressives”, and the friends of big government are great at spending other people’s money and always demand their one man one vote part of the Constitution when it comes to spending from the federal treasury. But when it comes time to fill the national treasury in a general tax among the states, as would be the case under the proposed “flat income tax”, they are relieved from the one vote one dollar part of the Constitution, which is also part of the apportionment formula and gave them their one man one vote.
Our founding father’s fair share formula for both representation and taxation are as follows:
__________ X House membership (435) = State`s No.of Reps
_________ X SUM TO BE RAISED = STATE`S SHARE
For the historical documentation concerning the rule of apportionment being applied to extinguish a deficit CLICK HERE.
Bottom line is, a “flat income tax“, if adopted, would not only continue to punish our nation’s productive citizens while relieving the unproductive from an equal burden in filling the national treasury, but it would continue to encourage big spenders in Congress who are relieved from our founder’s rule of representation with a proportional obligation.
The question is, what would happen if New York State’s big spending Congressional Delegation had to return home with a bill for New York to pay an apportioned share to extinguish the 2010 federal deficit? I kinda think tea parties would change to tar and feather parties all over the country and our irresponsible big spenders in Congress would REAP THE REWARDS of their tyrannical and big spending practices.
“The proportion of taxes are fixed by the number of inhabitants, and not regulated by the extent of the territory, or fertility of soil 3 Elliot’s, 243, “Each state will know, from its population, its proportion of any general tax” 3 Elliot’s, 244