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Idaho's Weekly Journal of Local & National Commentary  Week 3414

 

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by Free Market Duck

The AMT - Worst Piece of U.S. Tax Legislation
(Oct 29, 2007)

Washington, DC -- The Alternative Minimum Tax (AMT) is one of the worst taxes ever foisted upon Americans -- both at the economic and moral levels.

   Enacted by Liberals in 1969 to flog about 10 "super wealthy" individuals who were paying zero income taxes, the AMT -- through the Fed's continual hyper-inflation of our National Wallpaper -- has now ensnared some 24 million middle class U.S. citizens who will be required to pay much higher income taxes in 2008 if the AMT is not amended or repealed.

   Economics-wise, it is the rich or entrepreneurs who transform ideas into time and labor-saving devices that drag the poor up out of poverty and into a wealthier position, allowing better health care, better education, and more leisure time for the masses.  It is not the day laborer who creates wealth; it is the entrepreneur who creates wealth.  Taxing the rich (or the entrepreneur who is risking his capital) is a stupid economic policy since it tends to destroy the goose that lays the golden egg.

   In short, from a purely economics point of view, taxing the rich is a stupid idea.  Which is not to say that taxing the poor or middle class is a good idea.  The point is, it is the rich, the wealthy, the entrepreneurs risking capital, that you especially do not want to tax if you want to increase production, jobs, and the quality of life.  Any culture that espouses a policy of taxing the rich rests upon an immoral philosophy of envy, anti-individualism, economic sophisms, state collectivism and financial suicide for the poor and middle classes.

   At a moral level, the AMT is an anti-individual rights issue.  The AMT's "tax the rich" morality is an infringement upon the inherent rights of all individuals to pursue freedom of trade through voluntary exchanges.  The AMT at the moral conceptual level is also reprehensible since it sends the message that it is wrong for the individual to strive for survival and to achieve by one's efforts in a free market.  Idiots who want to tax the rich are actually taxing the poor, i.e. depriving the poor of the economic results of free market capitalism.

   The AMT was founded upon economic fallacies typically expressed by those whose intellectual and emotional levels have remained frozen at the level of a 12 year-old child's perception of economic reality.  (Duh, I guess if Joe is rich, he must have stolen it from Sam since wealth is a zero-sum game, right?  Or, as the sophism typically says, ďOne manís wealth is another manís loss, right?Ē  Hyuck.  However, if that's true, where have the proletariat been hiding the electric light bulb and computer chip for the last 5,000 years?)

   It's not so much that Liberals reason at the emotional level of children as much as it is that those who reason at the emotional level of children tend to gravitate to the Liberal Democratic Party to play out their emotional sophistries.  That's why the majority of over-emotional artsy-fartsies in Hollywood who reason with their groins and latest eye make-up instead of their brains gravitate to the Liberal Democratic party.  They are not intellectuals; they reason like children.  Similarly, it is not far off to say that politicians whose economic sophistry is at the level of a 12-year old child, such as Senator Hillary Clinton and the Democratic candidates for President in 2008, are economically and morally retarded or at least extremely naive in that their intellectual level of economics has been frozen somewhere around the understanding of a 12-year old's perception of economics.  That's why you see Liberals (and recently members of the GOP) proposing such ludicrous ideas as an Alternative Minimum Tax on the "rich" or a universal state health care scheme without realizing that there are no inherent economic traits in health care that exempt it from the basic laws of economics -- which is why we have a health care crisis today, because of previous and current governmental interventions into the health care industry.  The Liberals may as well propose a universal state automobile, universal state computers, or a universal state lawn mowing scheme for Americans.  All will fail and for the same basic economic reasons unknown to a 12-year old mind.  If you have a thorn in your left butt, the obvious solution is to pull it out, not shove another thorn into your right butt.)

   I digress.   Back to the scene of the crime: the Alternative Minimum Tax.  U.S. Rep Charlie Rangel (D for Dummy-NY) wants to repeal the AMT -- good idea, Charlie.  But, reasoning like a 12-year old child, he wants to replace the pernicious AMT with the Mother of All Tax Hikes (bad idea, Charlie): a $2 trillion per year tax hike on everybody's butt.  Why?  Because he is still at the econo-sophistry level of a 12-year old child, like most Liberals still struggling with 4th century concepts such as, "I wonder if we can tax our way out of poverty?" or "Hey, I know, let's just print up more paper money, right?"

   So itís time to stop pretending that "taxing the rich" with an AMT or any other tax -- including the Progressive Income Tax -- is a great idea.  It really sucks and anybody who can reason past the level of a 12-year old can easily figure out why.  Percentage-wise, or per capita, the rich receive almost nothing new since they already have it, and in fact created it, while the poor receive a ton of new cookies -- new cars, new computers, new medicines, new HD TVs, a reduced work week, and ad infinitum -- in a free market from the implemented ideas of the rich.  Those Marxian socialists who still think that value or wealth resides in labor per se (or a commodity per se) need to read my article Wherein lies the value of today's paper money? - Part 1 More... Part 2 More... Part 3 More... Part 4 More... & Part 5 More...

   Not only is it time to dump the Alternative Minimum Tax on the rich and the middle classes, itís time to dump Rep Charlie Rangel's Mother of All Tax Hikes, which is currently rumbling around both Whorehouses of Congress looking for 500 hookers from all 50 states to sign on.

   Finally, as a coup díetat to dumping the AMT, let's also dump the 60,000-page IRS tax code that costs Americans 7 billion man-hours and over $140 billion in fees to accountants and consultants per year, according to ex GOP House leader Dick Armey.  Dump the entire IRS bureaucracy and the progressive income tax altogether and implement a simple 10% flat income tax on EVERYBODY, rich, middle class, and poor equally.  Thatís a fair tax.  We can lower it or switch it to a national sales or consumption tax later, which is an even fairer tax.

   As a postscript, in order to prevent the AMT and the Progressive Income Tax from ever popping up again, letís think seriously about moving back onto some type of gold monetary standard with no fractional reserve banking as proposed by economist Nelson Hultberg at www.afr.org (Americans for a Free Republic) and in his book Breaking the Demopublican Monopoly.  As Hultberg says, we only need to take two basic actions to restore monetary sanity in the U.S.:  (1) Enact a flat 10% income tax, and (2) go back to a private gold monetary standard.  Dumping the Federal Reserve and the government's monopoly of fake monetary creation will automatically solve most of our current economic ills.

   If you think the men and women of ideas are not the true source of wealth in an economy, let them all go on strike as suggested by Ayn Rand in her novel Atlas Shrugged and see what happens to the economy.  You, too, will be crying, not only, "Who is John Galt?" but also, "Where is John Galt?  Help me please."  God bless the legitimate rich and individuals with ideas and the guts enough to risk their own capital.  The poor should fall down on their knees and kiss the feet of free thinking entrepreneurs for bringing us our current wealth.  Then they should strive to do the same.  And they should thank the American Founding Fathers for creating a free market infrastructure that allows individuals to become rich by their own efforts.  Which doesnít mean you should get hung up only on material wealth and neglect the personal health of your spiritual mind, too.  Remember, prices in a free market economy tend toward zero while prices in a socialist or mixed economy with targeted inflation tend toward infinity.  Help those who are less fortunate, but only in freedom, not through government force or fraud. -- FM Duck

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