Given the current state of uncertainty which has transformed our great country form the picture definition of neo conservatism, the desire to prevent future collapse (next 50 years) is more contagious than ever. Within the next four years, we will most likely see a “liberal” amount of government spending. Many economic and political pundits view this as a necessary transition to a more democratic society. Am I the only one who is disgusted with the thought of federally mandated democratic indoctrination to occur on such a large scale, once again?
The administration under President Franklin Roosevelt was successful at rebuilding the view a generation put forth when it concerned the role of government. Self reliance and “earning your keep” were eventually replaced with “the good of all”, and with it more power was conceded from our constitution. As 30% of our economy in the United States is represented in the form of G (for government), a further crowding out of private resource allocation is inevitable under this administration. Make no mistake about it, Obama is not going to tax citizens during their most desperate hour. Instead he most likely will further many citizens reliance, and with it a larger portion of American earnings will be spent before it is even collected. Taxes would be required to increase within the span of four years, as they should to offset further increases in government spending. The question is; does Washington know of the most efficient way to tax the individual citizens of individual states, so to maintain the democratic tradition? It looks to me that the individual states role in democracy is almost non-existent.
While it is accurate in stating states are represented by their elected representatives, it is also true that many elected representatives are going to Capitol Hill to act as beggars on behalf of their constituents to re-appropriate some of the income that has left the state in the form of IRS receipts. That is, many politicians are elected on the sole purpose of getting back some of the money their voters paid in taxes. I am not here to argue whether it works, or whether it is efficient. It is obvious that while it does work, it does also create waste, and in doing so a little extra for that specific lobby that prevailed on any given day.
What if the nature of the tax system was changed to represent the democratic nature of the states? While states have a more intimate perception of how their citizens generate income, they are also more aware of individual conditions. It makes very little sense to me that we elect individuals to gain influence so that they can re-appropriate funding back to the state. Instead of a federal agency collecting and reporting your earnings, and forcing you to disclose spending patterns to receive deductions; why not let the state decide how to tax its inhabitants? Take the projected overall budget, and divide it equally throughout the 50 states as a function of population. This ensures every state has a specific quota due to the treasury, and they would then be free to decide how to achieve this goal. For example, if a state believed that individual income is inefficient; it would then be free to invoke a sales tax within it's borders, while those who earn an income in that state do not pay an income tax. Of course, a state would be free to continue the IRS orientated taxation. Instead of having to ear mark spending bills, and play the political favors game to obtain support for your states funding, all state funding will be an equal percentage of taxes received.
The effects, in my opinion, would be representative of the local psychology of a state. States would also go a long way to attract specific individuals and businesses that are in conjunction with tax laws. We then have a competition between states, as the methods used will be analyzed to identify the not only the most efficient system, but the most effective system that allows for both growth and tax revenues. Eventually competition will allow for a specific decrease in taxes to correspond to independent levels of growth. The system that displays these qualities will be the model of all others, and mimicked to achieve maximum growth, and with it maximum standard of living.
I do wonder: what if a state is actually in need of funding that exceeds their percentage quota? Representatives will then be responsible for providing evidence that federally appropriated excess funding achieved the actual goal for which the funding was appropriated. Failure to do so might cause voters to go another direction. Those elected representatives whose ideas correspond to results will have a longer stay, and will gain more influence. Further influence and productivity/ingenuity will strengthen the overall structure of our country…
Posts
