The Anvil: Taxes

Fahim Rahman and Peace Chijioke

“Freedom is hammered out on the anvil of discussion, dissent, and debate.” Hubert Humphrey

Monthly, two students will take sides on a hot button issue and debate the merits of positions that are for and against. For this month’s debate:

Should the Rich Pay More Taxes?

For:

It’s only fair. When considering the topic of how the American tax system should be set up, the concept of equality between all citizens is key. But what constitutes as equality between all people? Under the current system, equality is defined by middle class Americans and the poor paying proportionally higher taxes in comparison to the wealthy. This is ethically and fiscally irresponsible, and change is necessary.

Poverty is apparent throughout America. These populations in communities throughout the country are stuck in such situations due to the current tax system. Poor people in America pay an incredibly high tax compared to their income, and thus struggle to pay to survive. As a result poor communities with lower educational, housing, and labor standards develop. Meanwhile, officials in corporate America bank on the back of employing these very same people and paying them low wages while making considerably higher profits themselves. It is a fallacy that most Americans should have to settle for paying higher taxes in proportion to their income than their wealthier employers.

A sensible tax system would include a proportional tax system for all Americans. It would be simple to institute, as wealthy Americans are the ones with the most resources to pay such a tax. On a 5% tax, someone making $1,000,000 would pay $50,000, whereas someone making $20,000 would only have to pay $1,000. The tax would allow lower class Americans to live a healthier lifestyle as their taxes would be reduced and money could be utilized for more beneficial purposes. Taxes would be utilized for the same purposes as they are now, which is for funding public needs. All in all, the proportional tax would force the rich to pay their fair share to benefit the American public.

Another important note is to get rid of unnecessary tax cuts for the rich. For example in Virginia, if someone were to win the lottery, 40% of the state’s budget for education would be paid for. One would assume that everyone would receive the benefit of only having to pay for the 60% remaining for the budget. That assumption would be wrong. Instead, the wealthy would receive a major tax cut and the majority of Virginians would have to pay the regular amount. While the lottery system makes money off of the lower classes putting their hopes into making big winnings, the only class of people that really benefit is the upper. Instead, such tax cuts should implemented for the lower classes as the rich are the ones with the resources to survive without the cuts.

What would occur as a result? Lower income families will be able to pay their fair share of taxes and have more money to spare. Poorer communities would thus be improved and also there would be more opportunity for the youth to receive a better funded education, which would in turn create a better laboring class. Employers would also profit from a better working class, as better trained employees will be able to create better products. Also more Americans would have more money and consumption, as well as competition, would rise. An improved economy would create improved communities across the country, and America would become a better society as a whole.

It is deplorable that under the current tax system the upper class have a cap while many Americans struggle to make ends meet. A fair tax system would force upper class Americans to pay the same amount, in proportion to their income. The proportional tax would still require all Americans to fund the public good but would not force lower income Americans to pay taxes they cannot afford. Taxing the rich a higher amount would treat all Americans fairly and the benefits would be pervasive to all facets of society.

Against:

On the topic of whether or not the rich should pay more taxes, there is often a failure to clarify on the pro-make-the-rich-pay side of things. If the contention is something along the lines of “make the rich pay more taxes than lower income individuals,” it must be considered that the top ten percent pays more than half of all federal income taxes, 68% to be exact. Making the argument that the rich should pay more than, is hardly valid, because well, they do. However, if the argument is that they should pay more in general, that is to say, “the rich should pay more taxes than they currently do,” how much more? A study by the Congressional Budget Office reveals that in 1979 the top one percent paid 18% of income taxes, and 25.4% in 2011. In less than four years the percent of federal income tax paid by just the top 1% has nearly doubled to 45.7%, according to a 2015 nonpartisan report by Tax Policy Center. Some may see the situation as hardly unfair. Those who make the most money should pay the most money, and this much can be upheld. However, to what extent? The top 10 percent already pay more than the bottom 80, and that gap has seen nothing but growth for the last few decades. How much more can be demanded until there is no more motivation to reach the top ten percent. The glory of any nation is it’s ability to innovate. If the U.S. is to continue to consider itself a Great Power, all should be done to inspire innovation.

It is no secret that not all is fine and dandy in the good ole U.S. of A. The Census Bureau reported 14.8 percent, or 46.7 million Americans living under the poverty line as of 2014. Dozens of School Districts found themselves gravely underfunded some up to 33 million, as in the case of Southern Pennsylvania, and there’s that pesky 22.4 trillion dollar debt hanging over Lady Liberty’s head. Roads, highways, and bridges, must be maintained, children are the future, and they ought to be educated, and the government should provide for its citizens unable to provide for themselves. It cannot be denied that taxation is absolutely necessary, and yes more money would do much to alleviate the current state of the nation, but before pushing the Robin Hoodesqe claim of increasing taxes for the rich to save the poor, implementation must be weighed over theory.