The Income Tax' drive to Mediocrity

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The Income Tax' drive to Mediocrity

Post by LS2 »

There's a hidden cost that comes with taxes. The effects aren't just economic, but also psychological. Most states take a higher percentage of taxes from people with a higher income, which takes away the incentive to do labour that is in higher demand. This effect is compounded by the fact that your basic needs, including health care, are provided by the state (with stolen money, of course). People are good enough the way they are, so they become mediocre.

A bigger absurdity is created by the bumps in tax rates. In the Netherlands, there are only two income tax rates, namely one of 37% for an income up to 73,000 euros, and one of 50% for higher incomes. If you only barely exceed this bump, your net income is actually reduced by 9,000 euros, and it only catches up once your income reaches 92,000 euros. That's a big gap. These people are working harder only for the sake of giving more of their money away to people they don't even know.

And that last part is also key here. Without the interference of the state, the rich are still inclined to give more of their money away, but they share it with their friends, for example by paying for meals. In ancient Greece, the rich would host banquets where poor people could have free meals. The rich person feels better about giving away, the poor are helped by what they receive, but there's an underlying, very human element in giving or reason to people whom you meet face to face. This is something of immaterial value; nothing can replace it. By taking this away, the state silos people and leaves them less happy. And for good reason. If the people who benefit from your tax money find you in a life threatening situation, they could just as well leave you to die. One intuitively feels this and becomes discontent. Humans are tribal people who have an innate need to know people and be known. In ancient times, your livelihood depended on being included in a group. We still feel this, and it still is true in extreme situations.

Another problem with the income tax is that it does more to take away upward mobility than it does to distribute wealth. It's mostly people who do honest work and aren't rich yet who are held down by taxes. The actually rich have more resources to find loopholes and circumvent taxes. Furthermore, their money goes into lobbying to co-opt the state, so that it mostly works to enrich them. The current system generates financial crises (because the wealth is artificial) so that more money has to be created, which mostly ends up in the hands of the wealthiest 1%. Lockdowns closed down mom-and-pop worldwide, while Amazon could keep on delivering the same goods. The not-so-Federal non-Reserve created $2.3 trillion in 2020. Almost half of this money ended up in the hands of billionaires, while local businesses went bankrupt. This isn't new information to this audience, but it highlights how rigged the system is. It's the more capable portion of the 99% who are mostly burdened by a higher income tax, while the wealthiest class enriches themselves through dishonest means.

Should the income tax be abolished, then? That's a slightly different matter, and not quite my point here. My point is that the state saps us of our human drive for excellence, thereby demoralizing us in subtle ways. Just like how our purchasing power goes down through taxes, so too our very vigour, and the health of local communities, are sacrificed by the vast, impersonal bureaucracy that levies those taxes. From the moment of our birth, our very humanity is being attacked. If human elements are to take the forefront in society, it should manifest in how we give; namely voluntarily and to people we meet face to face. The labour from which we derive our honour should not force us to feed the system which we oppose. We have an impulse to become independent, and a right to act on it without being disturbed by any nation-state; this is part of our essential liberty.

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Re: The Income Tax' drive to Mediocrity

Post by WoodyWoodPecker »

Hire accountants and lawyers to find tax loopholes for you, and paying them is also an expense and tax deductable. Just ask Trump and Biden.
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