|Incomes Taxes, Millionaires and Billionaires||Ammo for the Battle of Ideas|
by Christopher Chantrill
December 25, 2010 at 3:47 am
LAST WEEK Victor Davis Hanson wrote about the hollowed-out society in the Central Valley around his native Fresno, California. He wrote:
I wanted to witness, even if superficially, what is happening to a state that has the highest sales and income taxes, the most lavish entitlements, the near-worst public schools (based on federal test scores), and the largest number of illegal aliens in the nation, along with an overregulated private sector, a stagnant and shrinking manufacturing base, and an elite environmental ethos that restricts commerce and productivity without curbing consumption.
The elementary school that he attended as a child is now 94 percent Hispanic and well below standards in English and math. The rural roads are fast turning into rubble. The irrigation cutoffs have idled tens of thousands of acres, and unemployment is 15 to 20 percent.
There are many rural trailer-house compounds filled with junked cars, lean-tos, and trash, but for some reason the regulatory state does not reach out and regulate them.
It is almost as if the more California regulates, the more it does not regulate. Its public employees prefer to go after misdemeanors in the upscale areas to justify our expensive oversight industry, while ignoring the felonies in the downtrodden areas, which are becoming feral and beyond the ability of any inspector to do anything but feel irrelevant.
And, of course, nobody is doing anything about the epidemic dumping of trash, furniture, and often toxic substances throughout Californias rural hinterland.
For us middle-class drones, all this seems rather weird. How could the government be allowing all this illegal activity? How can our liberal ruling class, that lives to regulate everything that moves, allow this to happen?
But really, it all makes sense. An off-the-books economy is a direct result of the centralized regulatory state. And since the people that live and work in the off-the-books economy are often the poor and minorities, liberals just look the other way, and read a page or two from Barbara Ehrenreichs Nickeled and Dimed to get themselves all riled up about Wal-Mart.
Suppose you are about to start on the bottom rung of the construction business, as a one-man residential fencing contractor. If you hire American laborers they might want to work as formal employees. Lets just figure out what that would cost in Washington State, at the minimum wage of, say, $7.00 per hour. Theres the FICA tax of 7.65%. Theres the unemployment tax that, for a construction firm, is probably at the limit of 6 percent. Then there is workers compensation. Thats presently at $1.30 per hour for Landscape Construction and Renovation, or 18.6 percent of the hourly wage! All told, we are paying the government 32.2% in payroll taxes! You think that a seat-of-the-pants startup contractor is going to pay all that (let alone plow through the bureaucratic forms)? No, hes going to hire illegal Mexican workers, because they want to get paid in cash. Bank account? Forget it: hell cash checks at The Money Tree.
Lets look beyond the case of the gyppo contractor and the illegal alien workers. What about the marginal unskilled kid from the inner city or the white working class? Is he better off with his employer paying FICA, unemployment, and workers compensation? Of course not. Hed be much better off if he got the money in cash rather than the promises of Social Security in 40 years, unemployment benefits, and workers comp., all adding up to 32 percent of his wages that he never sees.
When ObamaCare gets going, of course, this situation will only get worse.
Every time the government enacts a new benefit, or tax or economic regulation, it increases the cost of doing business for ordinary, law-abiding businesses. Every marginal business affected by the new tax or regulation has to make a decision: does it try to obey the law, or does it go off the books? Of course, our liberal rulers understand the problem. That is why they often exempt small businesses from the latest regulation. But what they are admitting, every time they do it, is that their high-tax social-benefit state is profoundly unjust.
One of these days some right-wing demagogue is going to turn the general disgust with liberal injustice into a national political movement of bitter clingers.
But dont expect the ruling class to notice until it is too late. As Deirdre McCloskey writes: a typical oligarchy rises, closes to new entrants, and then goes to sleep.
Meanwhile, the regulatory state starts to break apart from its internal contradictions, and more and more of the rest of us decide to work off the books. But there comes a time when it is not just economically necessary to avoid unjust laws and taxes. It becomes a moral imperative.
Buy his Road to the Middle Class.
[The Axial Age] highlights the conception of a responsible self... [that] promise[s] man for the first time that he can understand the fundamental structure of reality and through salvation participate actively in it.
Robert N Bellah, "Religious Evolution", American Sociological Review, Vol. 29, No. 3.
[To make] of each individual member of the army a soldier who, in character, capability, and knowledge, is self-reliant, self-confident, dedicated, and joyful in taking responsibility [verantwortungsfreudig] as a man and a soldier. — Gen. Hans von Seeckt
MacGregor Knox, Williamson Murray, ed., The dynamics of military revolution, 1300-2050
Civil Societya complex welter of intermediate institutions, including businesses, voluntary associations, educational institutions, clubs, unions, media, charities, and churchesbuilds, in turn, on the family, the primary instrument by which people are socialized into their culture and given the skills that allow them to live in broader society and through which the values and knowledge of that society are transmitted across the generations.
Francis Fukuyama, Trust
[W]hen I asked a liberal longtime editor I know with a mainstream [publishing] house for a candid, shorthand version of the assumptions she and her colleagues make about conservatives, she didn't hesitate. Racist, sexist, homophobic, anti-choice fascists, she offered, smiling but meaning it.
Harry Stein, I Can't Believe I'm Sitting Next to a Republican
[T]he Liberal, and still more the subspecies Radical... more than any other in these latter days seems under the impression that so long as he has a good end in view he is warranted in exercising over men all the coercion he is able[.]
Herbert Spencer, The Man Versus the State
These emerge out of long-standing moral notions of freedom, benevolence, and the affirmation of ordinary life... I have been sketching a schematic map... [of] the moral sources [of these notions]... the original theistic grounding for these standards... a naturalism of disengaged reason, which in our day takes scientistic forms, and a third family of views which finds its sources in Romantic expressivism, or in one of the modernist successor visions.
Charles Taylor, Sources of the Self
Families helped each other putting up homes and barns. Together, they built churches, schools, and common civic buildings. They collaborated to build roads and bridges. They took pride in being free persons, independent, and self-reliant; but the texture of their lives was cooperative and fraternal.
Michael Novak, The Spirit of Democratic Capitalism
For [the left] there is only the state and the individual, nothing in between. No family to rely on, no friend to depend on, no community to call on. No neighbourhood to grow in, no faith to share in, no charities to work in. No-one but the Minister, nowhere but Whitehall, no such thing as society - just them, and their laws, and their rules, and their arrogance.
David Cameron, Conference Speech 2008
As far as the Catholic Church is concerned, the principal focus of her interventions in the public arena is the protection and promotion of the dignity of the person, and she is thereby consciously drawing particular attention to principles which are not negotiable...
[1.] protection of life in all its stages, from the first moment of conception until natural death; [2.] recognition and promotion of the natural structure of the family... [3.] the protection of the right of parents to educate their children.
Pope Benedict XVI, Speech to European Peoples Party, 2006
No lesson seems to be so deeply inculcated by the experience of life as that you should never trust experts. If you believe doctors, nothing is wholesome: if you believe the theologians, nothing is innocent: if you believe the soldiers, nothing is safe. They all require their strong wine diluted by a very large admixture of insipid common sense.
Lord Salisbury, Letter to Lord Lytton
What distinguishes true Conservatism from the rest, and from the Blair project, is the belief in more personal freedom and more market freedom, along with less state intervention... The true Third Way is the Holy Grail of Tory politics today - compassion and community without compulsion.
Minette Marrin, The Daily Telegraph
In England there were always two sharply opposed middle classes, the academic middle class and the commercial middle class. In the nineteenth century, the academic middle class won the battle for power and status... Then came the triumph of Margaret Thatcher... The academics lost their power and prestige and... have been gloomy ever since.
Freeman Dyson, The Scientist as Rebel