10.28.08

A libertarian defends the regressive tax rate

Posted in Society at 17:49 by RjZ

Alright, neither liberals nor conservatives can argue much; McCain and Obama certainly are both for a regressive tax system. Listen to them both address the issue. But I think it raises some eyebrows among libertarians that I might think a regressive tax is not without merit. Of course, the goal should be to reduce taxes and therewith the size and reach of government, but one reason, rarely mentioned, why it is quite reasonable for the rich to pay a greater share is quite simply that they get more value for their money.

The rich use the infrastructure to a greater degree. They drive more on the roads, they water their lawns, the police protect their wealth. The very poor may not even be able to afford to ride the bus, don’t have a lawn nor any wealth to protect. The rich have more assets to protect from foreign invaders and would lose a great deal more if our system were to come under the control of others. Rich businesses reap huge benefits when the military works to restore peace and stability in a region and encourages business. The rich enjoy the benefits of the department of commerce’s efforts to develop business with allies.

Is it socialist to expect the rich to pay a greater share of their income as tax than the poor? Absolutely not. In a small, efficient, working government, they get good value for their investment and they get more benefit than those making less money. Even in a poorly functioning government, the rich still enjoy more benefits from the government in terms of preserving their wealth, even if it has required them to pay for welfare and other more socialist programs which they may not support.

An exact reckoning of how much tax money goes to defending the wealth of the rich (along with the safety of the poor!) may be difficult, but few would dispute that they have more to lose.

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