Tuesday, February 14, 2012

Every day more examples for "The Candy Store Generation"

It seems California is so broke that they have totally cut State funding to libraries. Over at the forums of the writers site Absolute Write, we writers have been engaged in a debate over this. Unfortunately, the debate has devolved into politics, rather than a roundtable discussion. I guess that’s to be expected with such a topic.
I don’t generally get into political debates on this blog, as I want the subject matter to be as inclusive as possible. This is about my writing journey, and how through that I want my life to have more impact than just an arrow through the air. But my work-in-progress, The Candy Store Generation, is a political book. And the subject matter of that political book dovetails nicely with the story about libraries in California being the latest in that State’s financial woes. At other places where writers gather, the conventional wisdom is that if your blog isn’t attracting visitors you aren’t giving them anything of value. Hopefully this will be of value, as it describes something of my book.

I hope some of you will go to the Absolute Write thread and read some of it. No password is necessary. The essential information is that the State is cutting funding to local libraries. The State is broke. They don’t have money to fix roads and bridges. How could they possibly have money at the State level to fund libraries at the local level? Solutions proposed by some of the posters are: tax the rich more (even up to 90 percent); don’t fund road improvements as libraries are more important; go to a partial fee-based system; raise sufficient funds at the lowest possible level of government (township, city, county) to fund the library. That last one is my proposal.

This all seems to be symptomatic of something I feature in TCSG: the fascination with other people’s money (OPM). One of my chapters is titled “The O.P.M. of the People.” Borrowing is using OPM. The local community, in receiving tax money from the State to fund their local library, is using OPM. But wait, you say, didn’t the people in that local community give money to the State in the form of income taxes, real property taxes, personal property taxes, sales taxes, excise taxes, and just about every form of taxes you can think of paid by their residents? Sure they did, and the community wants it back. They don’t understand that those funds come back to them after a 5 percent handling fee—only 5 percent if they are lucky and they happen to have an efficient State government. Or maybe that’s a classic oxymoron.

The other problem with OPM through taxes is that even the wealthier communities will want their share. The City powers-that-be will see it as a way to avoid raising taxes, and will be only too happy to get some “free money” from the State. And being wealthier and perhaps better able to lobby or fill out grant applications, they are as likely to receive OPM from the State to fund their local library. Except it really isn’t OPM. It’s their own money returned to them after a State handling charge minus whatever part is transferred to poor communities. So it’s pretty much a shell game.

When it comes to taxes, there may be no such thing as OPM. If you live in this nation, you pay taxes. The AW thread has a contention that 80 percent of library patrons don’t pay taxes. What rubbish. Everyone pays taxes. I know what that poster was thinking. Since approximately 50 percent of the population doesn’t pay income taxes to the Federal government, everyone thinks these people don’t pay taxes. Since public library users could reasonably be expected to come disproportionately from the poorer classes, who can’t afford to buy books for themselves, the 80 percent of library patrons not paying income taxes is a reasonable assumption.

But I still contend that these people do pay income taxes; they just don’t write their checks to the Feds. They write their check to the landlord, who takes a part of that payment to pay his income taxes. They write their check to the grocery store, which uses a part of it to pay their taxes. And the part of it they use to pay their employees is in turn sent in to the Feds to pay their taxes. So those who don’t write an income tax check to the Feds still pay income taxes. They just don’t know it. And everyone thinks “tax the rich.” Where do they think the rich get their money? And why would they think the rich just won’t raise prices higher to cover their higher tax bill? I really believe taxes at all levels fall heaviest on the lower classes regardless of who writes the checks to the government.

I’ve been struggling with some of the content for TCSG. I think today I found something to use as an example.


Gary said...

The paying taxes twice removed idea is conceptually correct, except each step of removal weakens the association. At what point are you not really paying? In a web-like system, as opposed to a linear one, the dilution rate is pretty rapid.

As for the poor paying taxes, two things to note: 1) the sales and sin taxes take the larger bites, 2) you must count entitlement benefits not available to middle and upper classes into the equation to get a fair calculation of their net tax situation.

Using OPM is the brilliant scheme of the politicians. They rob Peter to buy the gratitude of Paul. And brag about it. And the sheeple fall for it.

David A. Todd said...

I remember, back in the 1990s, a report that the Federal budget includes an assessment of the effective tax rate, and that it's around 83 percent. I ran the numbers on my paying taxes analysis out to several layers, and it seemed to be converging on 83 to 84 percent of the price of anything.

I'm about to do some more writing about OPM in The Candy Store Generation. I'm not yet sure how it will play out in the book.