Can you really legislate fairness?
The following is a regular feature by Kyle of Rather-Be-Shopping. If you like this post, consider subscribing to his blog’s RSS feed.
The United States is quickly moving towards a society where the government feels they need to keep things “fair”.
Example: You have person A and person B, both fresh out of college. Person A gets a job and immediately starts to waste money on big screen TVs, cars and homes he can’t afford, racks up huge amounts of debt, and basically lives way above their means. Person B on the other hand, also gets a job, lives very frugally, puts money every month in his 401k, and lives well within his means. At age 55, person B has accumulated a great deal of wealth. According to many politicians, he must be punished, taxed heavily, and the money given to person A, who has nothing saved and a huge debt load, via government programs and bailouts. All in the name of fairness. I ask this question: “What could be less fair?”
Another example happened in our house on Halloween night. My son really hustled when ‘Trick or Treating’ and had accumulated twice as much candy as my daughter. When she realized this, the first words out of her mouth were, “Daddy, that’s not fair, he has way more candy than me.” I explained to her that “it might not be equal, but it was completely fair. He went to twice as many houses as you and really worked hard at it.” I guarantee my son would not have worked so hard had he known I was going to take 40% of his candy and give it to his baby sister!
Beware of the word “fair”. I have been hearing the word thrown around quite a bit recently and as a frugal person, and one that saves money for retirement and a family emergency fund, it has me worried.
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Note from Lynnae: As with all politically charged posts, I welcome comments from any point of view. I just ask that comments be respectful of Kyle, myself, and the other commenters.
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Wasn’t there a cutesy-clever t-shirt a while back that said something like, “Everything I ever needed to know I learned in kindergarten.” Anyone else read The Little Red Hen in kindergarten?
This is just another way of saying that those who are poor brought it on themselves and chose to be poor. My husband works for less than $11 an hour, and I’m disabled, making less than $400 a month. We are scraping by, getting rid of our debt (which is lower than the American average) and paying off his student loan. Is our situation fair? Nope, but we don’t complain often. We DO complain when trust fund babies (not that you are one, obviously) whine about paying taxes and whine more that those undeserving poor don’t have to pay as much. Your post angered me, but only because I think it is a misguided look at the poor and lower middle class. Please re-think your views. If it were really about people who screw up vs. people who think and use common sense, the world would be a lot more fair than it is, and we wouldn’t need these politicians who are finally thinking beyond their own pay class.
Amanda, I appreciate your situation, and I don’t know what the answer is.
On the other hand, my husband and I chose for me to be a stay at home mom. We’re not irresponsible, but because of our choice, we make less than the average income in the U.S. and would surely benefit from the tax breaks given to the lower/middle class.
But because me being a SAHM was a conscious choice, is it fair to ask families who sacrifice time with their children, so they can have two good incomes to pay for my choice to stay at home?
There are a lot of situations and a lot of ways to look at fairness, and no easy answers. Whatever the answer is, it’s not fair to somebody. I don’t think legislating fairness is possible.
I look at my neighbors who are all busting their humps 24/7 — many of them with both mom and dad working two minimum wage jobs just trying to put food on the table — I wish it were as simple as people making wise choices vs. unwise choices.
Your scenario assumes that person A and person B have equal opportunties to go to college. That’s simply not the case. What about person C who has been working since age 15 to help the family cover the basic necessities? What about person D who had to drop out of college when her mother got cancer and what little her folks had planned on dedicating to her college fund is now being used to pay medical bills? What about person E who grew up not even knowing if the electricity would be on in the house from day to day or where their next meal was coming from, but now they are providing a solid roof over the heads of their own children?
It’s easy to say you make choices to live a frugal lifestyle, but what you don’t seem to realize is that this lifestyle is simply what many people live. They don’t see it as a choice, and most of them don’t even worry about it being fair. It’s simply what life is and they work hard and make the best of it.
I’ve lived in both neighborhoods. I’ve seen enough to know that it is the “poor” folk who are most likely to come to a neighbor’s aide when times are tough. Quite frankly, they are the neighbors I prefer to have. In my experience, most “poor” folk carry less debt as a percentage of their income than those who are “better off.” Often what they do carry is not for that new car or big TV, but for junior’s medical bill or because they had to replace the heater in the middle of winter.
So no, I don’t mind a few tax breaks to give those with less income an opportunity to catch up with the cost of living. Many of them will use it wisely. Many of them will better their lives for themselves and for their children. And that’s good for everyone.
Rather than asking what is fair, let’s ask what we can do to make the world a better place. Let’s ask how we can make a difference for more than just ourselves. Let’s ask about compassion. Let’s ask about what we can give or do or say that will help the next guy improve their own lot in life.
I don’t really care if you choose to only make $35,000 per year or if it is taking the combined efforts of both you and your spouse to make that $35,000 per year. (And I know people who would consider themselves “rich” if they were making that much.) Either way, I don’t think those people should be asked to stretch those dollars even further. If you make $350,000 — I’m not to worried about it. You’ll find a way to make ends meet.
If you think the person with low income is living high off of government subsidies and hand-outs, then perhaps you ought to come live a while in their shoes. It’s simply not that easy. It’s certainly not black and white.
I have mixed feelings. I grew up in a working poor household. My sister was born when I was 3 years old, and my parents were 22 years old. She was born at 23 weeks of gestation and is severely physically and mentally handicapped. My mom quit work for a while to care for her. My parents got no benefits from the government other than WIC, because my Dad took as much overtime at his barely above minimum wage job as he could get. My parents told me to do well in school and work hard. The only debt that they had was their mortgage (a $27k house) and when they would buy a car. They did not use credit cards. They to this day use the envelope system for budgeting.
Fast forward, I’m now 29 years old, married, have a 2 year old, work full time, have a master’s degree, went to a private college as did my husband. We have a mortgage, our only debt. We earn fair wages for our work. We live below our means, and we’re saving for our future.
I am fine with my tax money being used for programs like WIC, SCHIP (state children’s health insurance program), educational grants, and that kind of thing. I am not fine, however, with my money being used for bailouts and for helping people who got in over their heads.
I am for a hand up, not a hand-out.
I don’t think Kyle’s post even addressed giving money to poor people. He wrote not about people who are poor, but people who are *broke*. There is a difference. Poor people, as you say, are frugal by necessity, and they have very few options. People who are simply broke have plenty of options, and the options they choose are bad ones.
Trent, over at The Simple Dollar has posted eloquently on the differences between being poor and being broke.
I have no problem helping people who are doing the best they can with what they’ve got. I do have a problem with bailing out those who are irresponsible with the advantages that life has dealt them. And make no mistake, when the government bails out the irresponsible broke, there’s less in the pot for the responsible poor.
Kate, I think that is a very good point, and I like that distinction between poor and broke. The question is, how do we make sure the money gets to the poor and not the broke? I’m definitely more open to my money going to people who need help for reasons beyond their control, such as medical bills, than going to people who just make unwise financial decisions.
I think that’s why I prefer the government stay out of the charity business. If the government decides who to give the money to, they have to go on some arbitrary income figure, which doesn’t distinguish between the needy and the lazy. When private people and organizations give, there’s more of a personal touch, so the money really goes to those who need it.
I think you’re completely right. DH’s mom is one of those broke people. She has a poverty mentality and it keeps her poor. DH and I both grew up in poor homes. The only difference was that my family worked really hard to make it better. We planted a huge garden and grew all of our own food and preserved it and saved every penny. DH’s family spent like crazy and is still living paycheck to paycheck while my parents are comfortable set for retirement. I understand there are situations where medical problems and dissabilities produce poverty, but overall we live in a country where opportunities to improve your situation abound. It won’t be easy, as many people wish, but with hard work, persistence and financial responsibility you too can become financially wealthy.
If we are really worried about keeping things “fair” as so many commenters above stated we would actually be taxing the poor in this country almost as heavily as the rich and we’d be sending our money overseas to help the truly poor (poor financially and poor in opportunity to have a better life). If you make $25,000 you are in the top 10% of the wealthiest people in the world.
Taking from the rich and giving to poor is only fair if you apply it worldwide. We can’t say to do this in our country and ignore the truly poor around the world.
Many people cry “equality” when it will benefit them and “prejudice” when it doesn’t.
Like others have pointed out, there’s a difference between poor and broke.
I would love to see more help for people who are legitimately poor and can’t get ahead, no matter how hard they work.
My dad works 60 hours a week to barely make ends meet. My mom has been very ill for years and cannot work. They need state assistance for things like health care, utilities, etc. Those are the people that such programs exist for – my dad works hard, contributes to the economy, and pays his taxes.
What bothers me are the people who have found loophols in which they can kick back and collect money from the state without lifting a finger. They have the same issues with barely making ends meet than my parents do, but they don’t work for it.
Rather than see the government take more money from me and split it between people like my parents, and people who milk the system, I would sooner give that money directly to my parents to help out.
This is why private giving is so much better than the government taking it from you and deciding where the money will go.
I can give to people who really are in need, and tell “Dan the Deadbeat” to take a hike.
I think you have a point, but it might be more far-reaching than even you propose. I was laid off in June 2007. I have been scrapping ever since. No one will look at me due to my experience and education. The only ones who get hired in my field – teaching are the ones right out of college, as they cost the district 1/2 as much. I’m afraid that anyone with any income will be pick-pocketed to take care of the have-nots. I’m the saver in the family. I squirrel away every penny I can get my hands on. My husband, on the other hand, has the attitude of, “I work, so if I want something I deserve it.” Needless to say, we keep separate accounts and the majority of savings is held by me. He likes payment plans, where I like to pay everything in cash or at least pay off the loans early. It can be very frustrating. He gets it from his family.
In the world of having money and material possessions, the “have nots” have appropriated and twisted the concept of “fairness” to suit themselves. To them (and to the politicians who cater to them), it is not enough that everyone have the same opportunities. No, to them fairness mandates equal outcomes.
True True Mr ToughMoneLove. I love what you’re saying. We all have equal opportunities.
I’m amazed at how many satellite dishes I see hooked to apartments in “poor” neighborhoods in my area. I think this country is full of people who make unwise decisions with their money. There is plenty of evidence in our current economic situation to prove that point.
I agree that a congress/administration that is trying to be “fair” will only end up hurting those people who work hard for a living and sacrifice now to be better off later. There are many state and religious charities that exist for those who need a “hand up.” It is unfortunate that the electorate has seen fit to give the role of charity to the government. I fear that it will take a generation to repair the damage done in this next administration, and that’s assuming that people wise up to the illusion of equity and realize that only by hard work, perseverance, and sacrifice by the individual can any financial independence be gained.
Anyone who thinks everyone has equal opportunities has not lived in a truly impoverished area or honestly hand to mouth.
It is easy to point out those who take advantage of “the system” and ignore those who are truly crushed by it and just trying to escape their own impoverishment.
If everyone had equal opportunity we would all be born to the same circumstance. We’re not. There are many many people who were not as lucky as I was to be born into a stable household where I knew I’d be fed every day and have warm clothes to go to school in. I had opportunity to improve where I started from. Not everyone is that lucky.
Does it anger me when I feel like people take advantage of “the system”? Of course. But I’d rather it was taken advantage of by some and available to help the many, than it not be available at all. We all at the end of the day, answer to ourselves.
Paidtwice – I definitely think there needs to be a system to help those who truly need it. I just don’t think the government is best suited to run it.
I know that even on our lower than average income, I don’t need help, and I can afford to give to those who need more than I do. But the government instead will give me money, instead of giving it to someone else, because of my income.
And if a couple is making a good two salary income, the government will take their money, based purely on their income. Never mind if they have some catastrophe in their extended family that they’re already giving their resources to.
I think the private sector is much more able to monitor people’s true needs, rather than leaving it to the government, that really has no choice but to base it’s spending decisions on raw numbers, because they’re far away in Washinton D.C., rather than in communities across the United States.
“Life is not fair – get used to it.” Those are the very words I used every time my kids would complain about something not being fair. We didn’t try to even things out nor make adjustments. They each had their lot in life and adjusted their attitudes to make the best of what they had, and to hustle and make do for the rest. I believe it made my kids into the good people they are today – doing for themselves and their family, but lending a helping hand to friends when needed.
The ‘richer’ provide the jobs – leave them alone and quit taxing them to death. If you discourage them, they will pull out and there go the jobs. I know this for a fact from personal experience. I once was an employer myself – but I got tired of being taxed to death and went back to just keeping it all within the family. And then I sold out. Numerous people in our community have done the same thing, time and time again. Being a small business owner is a quagmire of taxes and hassles if you have employees.
Now I get by on under $20,000/yr (by choice) which is more than enough to live comfortably on and still save up for retirement. But I doubt many people would give up TV, fancy electronics, going out lots, fancy clothes and new cars every 3 years and live the simply life with a garden and a sewing machine like I do either!
This country needs to keep encouraging those who work hard with adequate compensation for their labors, and not give so many handouts to the able bodied who refuse to work. Yes, there is a place for government charity – those who legitimately thru no fault of their own cannot provide for themselves. If we discourage the worker bees, the queen(country) will die!
I appreciate everyone’s opinion and I agree there is no black and white answer.
I am also not saying that we shouldn’t help those who truly cannot help themselves. That is what a responsible society does.
My beef is with those that live above their means and then expects those that scrimp and save to then help them out. The housing bailout is the most recent example of this.
I also agree with some of the comments that the government is worst suited to deal with this issue. Government needs to provide law and order and then get out of the way and give people maximum freedom to make their own decisions. Understanding that some people are going to make very bad desisions and bring upon great woes to themself. Whether it be obesity, poverty, or whatever it is. But in the long run, allowing citizens to make their own decisions is the best way for a society to thrive.
I agree that life is fair…life gives all of us opportunities to learn every day..the difference is our attitudes. This is where choice is such a powerful tool for me. I begin each day with a quiet moment or two and try to carry gratitude with me. Keeps me off the pity pot! Great post and loved the story of the kids and candy :-)
Namaste
Fair is usually a word used the Republicans and the Conservatives to facilitate a wealth transfer from the middle class to the very wealthy (including corporations)
Speaking of fair,
Is it fair that the employed contribute to the unemployed?
Is it fair that the insured pay for the uninsured?
Is it fair that the childless have to pay for education of those that have children.
Is it fair that non library users have to subsidize library users.
Is it fair for car owners to pay for public transportation?
Is it fair that those on the good side of town have to pay to police the bad part (why not just put up a good fence)
Is it fair for the rich to subsidise college education for the working poor.
Is it fair that those with good jobs have to subsidise the working poor?
Is it fair for good school districts to subsidise poor school districts.
My problem with posts like this is people confuse personal responsibility with the Nanny State. There not the same. This isn’t the UK, America has never had a Nanny State and never will.
I understand what Kyle is saying, but one of my reactions was that some might take it a few steps further into a mindset that does more damage than not.
For the most part, the responses here have shown that particular reaction to be wrong and people understand the differentiation between people who have wasted their opportunities and wealth and people who have never had them. And I’m grateful!
There is much I’d like to say, but I’ll try to keep it fairly short. First of all – what is the definition of able-bodied? If you look at me, I appear healthy and whole. Yet, I have multiple physical disabilities and a chronic illness that, together, prevent me from working more than part-time. I choose to work rather than apply for disability. Yes, I sometimes have to (like this morning) go to the food pantry to feed my family. It usually means that our home stays cold all winter long because I can’t afford $300 a month utility bills. It means that I no longer participate in social activities or hobbies; that the only store we ever see is the grocery store. It also means that without Sect. 8 housing we’d be homeless, and without the home that we have through Sect. 8 I would not be able to have a garden to supplement our diet and provide the fresh foods that are so important to my health in particular.
I am blessed that I have skills that so many others do not! I can garden, can my own food, cook from scratch. I am creative in a way that lets me look at something and see possibilities for other uses; I know how to shop so that my $ go as far as possible. I have zero credit because I have not used credit since my children were born (and yes, I’m a single mother).
And yet, I know that there are many, many people who are so much worse off than I am. I work as a case manager/advocate for adults w/ disabilities and extreme income challenges (www.phpnw.org). Some of my clients are homeless, some have incomes of less than $250 a month. None of them have health care, which only serves to worsen the disabilties that they have. I make no judgements about who made bad choices, who ruined or by-passed past opportunities, etc. I meet my clients at whatever point they are in life and work with them to begin enhancing their lives. I believe that someone here used the phrase that we use in the organization that I work for – “offering a hand up – not a hand out”.
ALL people should be able to have at least a minimum of the things required to live a decent life – a roof over their heads, food to eat, decent medical care, opportunities to be involved in a caring community. Those things cannot be legislated, but the impetous to provide compassion must come from each of us. No matter what your personal situation, there will always be those whose situation is worse. In life, there is very little that is truly “black and white”; the majority of living takes place in all the gray areas. Thinking punitive thoughts, refusing to see the “gray” etc. will do nothing to make ourselves, our communities or our world the least bit better.
@ Kyle a better question perhaps might be,
What sort of safety net should the government provide if any?
Should we go back to the pre depression era when there was no social security, unemployment insurance, medicare or medicaid or public schools to speak of?
Any thoughts anyone?
I like your blog but I need to say this and I apologize ahead of time for being harsh.
As a personal finance blogger, you need to learn the difference between a high-income earner and someone who is wealthy. While the two states do sometimes overlap, they are not synonymous with one another.
You’re not the only one who behaves as though the two states are synonymous; while I do somewhat support the idea of higher earners paying more into the system (and that belief is strongly founded in some of the universal aspects of human culture going waaayyyy back to early settlements where potlatches and giveaways were commonplace, right on up to the present day and the Big Three religions and their teachings about giving to the poor), I don’t agree with the habit among some liberals (OK most of them) of equating high earners with the wealthy and pretending that high taxes equate to the wealthy paying “their share.”
Because, when you think about it, what taxes are we talking about here? Income taxes. Payroll taxes for Social Security and Medicare, as well, which are also income-based.
But what is a wealthy person? A wealthy person is a person with a high net worth. That is, whether or not the person is in debt at all, they have so many assets that the assets outnumber the debts.
It has very little to do with income. A person making $20,000 a year could be worth $50,000, while a person earning $100,000 a year could be worth -$50,000.
And the only form of wealth I know of that is taxed while you hold on to it is real estate, and in most areas of the United States (if not all of them), property taxes are far lower than income taxes are if you compare $100,000 worth of real estate to a $100,000 income. If you throw in payroll taxes for SS/FICA/Medicare it’s no contest.
So there is no way that income taxes “punish the wealthy.” The wealthy pay a smaller fraction of their wealth as income tax when compared to their total wealth, and it doesn’t matter if you raise their tax rate to 50 percent or higher–which you wouldn’t, because that’s not how IRS tax brackets work. But even if you could, they’d still have wealth.
Now here’s the irony. Are you ready for this? High earners who feel pinched by income tax rates, well, there’s a reason they feel that way. They feel that way because they are also high *spenders.* If they weren’t high spenders, if they were frugal, they might grumble a little bit about paying taxes simply because frugal people hate spending money, BUT, they wouldn’t be screaming their heads off about it like they are now.
So it’s funny that you blame poverty on people spending money on things they can’t afford, and then state that poor people should not expect the government to help them because they were stupid–but you sympathize with high earners who want to be able to blow more of their money on stuff they don’t need, and who expect the government to help them be spenders by lowering the marginal tax rate on higher incomes.
You know, nobody earns the right to be an idiot just because they are making more money. Everybody should be careful with the blessings they have earned or been given, and spend those resources wisely when they must be spent at all. This is true whether you are making $20k a year or $200k.
And it’s not like income is that closely tied to personal worth, anyway, which is another myth that PF bloggers need to just drop–it’s a myth, it’s a weapon against the poor, it’s a bolster to people’s own sense of unearned smug superiority. People are paid more when their employers want to pay them more, and are paid less when their employers want to pay them less. You could work your butt off for 80 hours a week and still not make a lot of money for your efforts if you have a stingy boss. You and I both know that happens a lot in this country. So let’s quit pretending that people with more money “earned” it specially somehow.
I wouldn’t be surprised if one of the excuses people give for not wanting to be frugal is that they’ve seen how frugal people talk and they don’t want to be like folks who say mean things about them. Ditto for fiscal and social conservatives. If you really care about other people and want to help them improve their lives then the last thing you do is give them another excuse to put off doing what they need to do.
And it starts with doing your homework and actually thinking about the issues involved rather than knee-jerking and passing on the same tired old stereotypes that everyone else passes on.
One of my favorite finance books is The Millionaire Next Door. If you haven’t read it, you should.
Again, sorry about the harshness. I’d say I do it out of love, but I don’t know you. :)
Life is rarely “fair”. That said, where I have issues is when we punish children(who conservatives seem to insist be brought into this world whether their parents want or are able to care for them from a physical, emotional, and spiritual standpoint)for the mistakes adults make. I think neither side has the moral high ground. The GOP wants to control personal issues such as who you can marry, when you can reproduce(and hey women they wanted to make BC pills an “Abortifactant” so do not even tell me this is not about reproductive choice. Wake up!). They also think it is quite fair to holler free market in regard to wages or any benfit for the working man(that might cut into company profits and investor payouts) but are the first to holler for government help when it is their sorry backside on the line. I’m actually disgusted with BOTH parties. Neither seems to represent me or my values.
Lynnae
Great, so the government gives tax dollars to private organizations who then have the ability to discriminate(what they are doing with “faith based” initiative)? Ugh. I’d rather have the government give the money out and then require oversight(and by oversight I don’t mean absurd rules that don’t allow people the opportunity to get ahead. Why in the world should I require someone to sell all their assets before providing them with help?)
Dana not quite true about high earners being high spenders. Many are struggling for just like us. Check out this Fortune article.
very interesting
High Income and Broke
Rob
I’d like a full revamp myself. Since when is it the government’s job to decide who can and can not marry? How does that benefit our society? Since when is it the governments job to be the morality police? Personal issues belong being just that, the government should not be interfering in issues like family planning because then you can’t claim this is about people making bad decisions for themselves, not when you have the government say they “must” make that decision.
Yesterday I was on a frugal personal blog and someone asked a woman why she had three kids if she couldn’t afford them? I find that incredibly ironic considering that we have made it harder and harder for women to make the choice not to have those children(cost of pills has gone up and are no longer required to be carried by insurance companies, procedures are being banned or made more difficult by requiring waiting times and women to view ultrasounds, etc. etc.
My position is that you really can’t complain about social programs when you require the government to socially engineer personal decisions.
Well everyone, looks like your worse fears are about to unfold and Obama my try and push to get the health care mess fixed.
Horror of horrors America may actually get universal health care. Honestly I don’t think that it will ever happen, too many vested interests in the status quo
via Paul Krugman
Read between the lines Rob,it won’t be universal. It will only cover 95% of the population and 2/3 of the uninsured. I wonder who the unlucky 15,000,000 who get stuck without will be. Considering his comment about forcing the poor to choose between rent and health care during the primaries with “universal” healthcare, I’m betting it will be the most needy. Obama is status quo but hey he’s “historic” because of his skin color(oh goody).
It’s much more about the extent to which you are willing to allow people to become homeless, malnourished or die of hypothermia in their old age. All that stuff happens now, but not as much as it would in the absence of a complete safety net.
No, it’s not fair that you pay more taxes. Life isn’t fair. If you want to rely on the old age safety net, be my guest. I’d prefer to to have a little more money.
Jeez…I feel so sorry for these people who are able to sock away $4000 a *month* for retirement. $750 per month *per child* for college savings. $2200 per month at (very high-quality, I’m sure) day cares. And who knows how much more at private schools. These are *luxuries*. Between my husband and I, we are saving $6000 per year for retirement, and nothing for college for our two kids. I work a night job so that I don’t have to pay for day care, and the kids attend public school. I fill the gaps in their education by tutoring them *myself*, not paying a private tutor. And recreational sports are played at low-cost volunteer ran leagues (and only one per season per child). We have a modest 1500 sq foot home (I couldn’t find sq footage on their “modest” homes), one TV, a Wii and a dog. Our cars are ‘98 and ‘06-and we will not replace the ‘98 until the ‘06 is paid off. The house and car are our only debt.
As it is, I still do not mind the taxes I have to pay, as they are well worth it. I grew up very poor, had a child in my teens, and lived off of the government until I was 22 years old. But I spent that time working hard in school (paid for by grants) and at a full-time job (two in the summer). We lived in a tiny apartment (paid for by me), and ate a lot of Ramen and hot dogs (paid for by me) to supplement the WIC/foodstamp foods (paid for by the government). Doctor visits were paid for by medicaid. I am happy now to be able to have the luxury of a house and a dog and a video game system and DVD player. To be able call a tow truck when the car breaks down instead of a friend with a truck and some rope. To be able to call a repairman the day the AC breaks instead of having to save for months or find a window unit at the pawn shop. And none of this would have been possible without government help in the form of food stamps, medicaid, and financial aid grants. Now that I no longer need that help, I am happy to pay into the system in the hopes that my tax dollars may help someone else, even though I know that some of it will be wasted by the lazy in the country. I look at it as returning the money given to me at that time in my life, with interest. And we are still far below the HENRYs of the country.
I understand the sentiment behind this post, but I’m more concerned with “fairness” when it comes to people making $500,000+ annually (or every few months in some cases). They need to contribute more to taxes in my opinion – and they can certainly afford to. Should I think Joe Shmoe who works hard for his money needs to cover the sins of Jill Pill who blew her money stupidly? No, esp. ‘cuz I’m more in line with Joe Shmoe. But the purpose of “fairness” isn’t to cover some idiot with credit debt, although in some cases that will unfortunately be the reality. In the long run, though, I think more often than not it will be benefiting those who work hard and fell on hard times than those who milk the system, and I’d rather help my fellow man than prevent opportunities to help them to avoid benefiting the clowns who can’t take responsibility.
I still don’t understand the logic of people who cry out that “the rich should pay more taxes because they are rich!” Why? No one in this country ever expected the government to take care of them until the Great Depression occurred and FDR’s New Deal forever changed the role of government and greatly increased income taxes.
Regardless of whether the wealthier inherited their money (which has already been taxed once) or made it themselves, why do so many people insist the “rich” should pay for everybody else? It seems that no one views themself as rich and therefore it’s those “other people who have more than I do” that are supposed to pay more.
This is a sad case of self-pitying and scape-goating. Self-pitying because some people aren’t satisfied with what they have. Scape-goating because they blame others for their misfortunes or for not taking care of them. Sure, there are high-income people who have taken advantage of others; there are certainly more low-income people (because there are many more low-income people in this country…) who have done just the same.
If you want to see the poor taken care of, start by giving your money away to someone worse off than you and set the example for everyone else.
Linz,
With all due respect you are not accurate.
The excise phone tax that was created well before FDR took office was created to pay for the Spanish American War(Fancy that, requiring people to pay for a war). At the time it was created the phone was a LUXURY that only the rich could afford. That’s right, FDR did not “invent” the idea that the rich have a responsibility and obligation that comes from the prosperity this country allowed them to create or keep.
Linz,
Actually, I give regularly and as generously as I can to both my church and other non-profits. I’m also getting myself into a position to help donate to local food pantries. So please don’t assume that I, or anyone else, do not give. Talk about scape-goating.
I don’t think anyone on this board is arguing that low-income people don’t take advantage of the government, other people, or any other innocent entity. What some of us are arguing is that others, like Kyle who posted the blog, have a misguided view of what it means to need help in this world.
I don’t think that there is or ever will be a perfect solution to any problem in this world. I do believe that giving should start at the local level, but I have no problem with the government stepping in to help. I have absolutely no problem with people being taxed according to what they make. It’s not like I’m robbing the couple who live two miles from me in a McMansion. The fact is, I’m not even directly receiving their money.
This country is hurting financially, and it’s hurting bad. Taxing those who won’t hurt (as much) by losing their money is a good way to get our country back on its feet, provided the money is not wasted completely (and I could give you a list of ways I believe it’s been wasted in the last eight years, since I became eligible to vote and started paying attention to such things). If I had any say at all (beyond my vote) I would bring financial education into our schools. I know my children will understand finances a whole lot better than I did.
One final point: Let’s say I give the church, a non-profit, or a needy person a sum of money or a group of goods. Do I have any say after I’ve given that gift in what happens to it? No! Absolutely not. Let us give with a spirit of generosity, not sanctimoniously.
The end.
Amanda
Wow, there are some great comments here.
Back to the original point of the post “Fairness hurts the frugal” I have to respectfully disagree.
I have lived frugally in two countries that like to keep things “fair” (UK and Canada).
A big part of my being able to do that is the fact that I have had to pay very little out of pocket for medical costs associated with a chronic disease I developed in my early twenties.
I am happy to pay higher taxes as my wages have increased, I have seen the benefits of that system and I think others should be able to as well.
Looby
I have heard similar sentiments. Things like health care costs have actually hurt our businesses competitiveness(All except the insurance companies). They end up leaving the country to bring down payroll. Furthermore there is something way out of whack when over 50% of your bankruptcies have medical expenses as the reason for banko9ruptcy and about 75% of those HAD insurance. It’s sad but most of America is one medical misfortune(which by the way isn’t really something you CHOOSE to have happen)away from losing everything.
Americans are such idiots!!!!
Teaching your kids personal responsibility is good parenting, but to confuse that with what is good Government policy is stupidity.
Personally those that prefer the pre depression era of no social support (social security unemployment insurance medicaid) would quickly change there mind the moment they lost there job or there pension plan went bust or there parents needed an operation that they couldn’t afford.
@ Vanessa excellent, couldn’t have said it better myself. Your a shinning example of why we need a good social safety net.
as an afterthought, my comment above was probably a bit over the top, you should argue issues not attack people. Sorry about that.
Rob, are you aware that the majority of the depression era social programs instituted by FDR were suppose to be temporary? And now we are paying big time for the fact that they are still around.
Take Social Security for example. I pay 12% off my income into SS. We need to start to phase out SS, let me keep that 12% and invest it myself into an IRA. I sure as heck can do a better job of investing and managing my own money than the government! As it stands right now, SS is drying up and I am not sure if I will ever see a cent from it in 30 years when I will need it.
You know, it never ceases to amaze me what people complain about. I know, let’s all complain about taxes and having to pay them. Well, you enjoy being able to drive on proper streets, have your trash picked up, and drink clean water, right? These are all things everyone enjoys, rich or poor.
Oh, I know. Forget about taxes. Let’s speak out against universal healthcare. Hmm. Are you still going to be speaking out against it when it’s YOUR mother that is dying of cancer and can no longer afford to stay in her house? What about if it’s your child? Oh, wait, you have “health insurance.” Well, what about when they cut you off because they found a pre-existing condition you didn’t even know you, or your son/mother, had? Still think it would be a bad idea to have universal healthcare then?
So, here’s my revolutionary idea. Let’s stop complaining about paying taxes. Let’s get rid of this assanine idea that having healthcare for all would be a bad thing. Healthcare for profit is a sick and outdated idea. I know, I work in healthcare. Instead, let’s take a look at what we already pay in taxes and, as a people and a nation, demand accountability from our elected legislature and president as to where the money is already being spent. If we can afford to pull money out of the system to give it to wall street, I’ll bet we could find the money to have healthcare available for all.
I will never understand, even after all the nasty follow-up comments that will undoubtedly be left after this post, how 18,000 Americans die every year from not having health insurance and we as a people are ok with that.
Paul, I can’t speak for everyone else, but I know I wouldn’t mind paying taxes, if the government managed things well. Unfortunately, I think the government does a horrible job of managing the people’s money. So while I agree that a lot of the things you mentioned need fixed, I’d prefer we not rely on the government to fix them.
And for what it’s worth, my family was without insurance for a year, my daughter and I got turned down for private insurance, due to pre-exisiting conditions, and now that we have insurance again, the amount we pay each month is outrageous. So I’m personally acquainted with the problems of our current system. But I still don’t want the government involved in my health care. I don’t trust the government to manage health care effectively, and I don’t trust them to make jugement calls as to what treatment I need or don’t need.
I think the big thing to realize here is that our system is definitely broken. Some people think the government should fix it, and some prefer the private sector fix it. But I think the important thing is that we all realize our system needs to be better than it is. So while I may never agree with you, I respect that you want to fix the problem.
Good grief! So Amanda’s answer to my question about why the rich are supposed to pay more in taxes is because “it won’t hurt them as much.” So who are the rich? Are they people who have worked hard their entire lives and have managed to save money like Kyle points to?
And cwaltz, I never said FDR “invented” the idea of taxing the rich. I only said that he changed the role of government (Social Security!) and greatly increased income taxes. That statement doesn’t negate anything that happened before his administration. (And income taxes first began with the Civil War.)
I think the solution to our financial has to be a painful one. Rather than “outlaw losing” which is currently happening with the government’s bailout plans, those companies should be allowed to go under. It will hurt. A lot. But it will be better than drawing this whole mess out for future generations to deal with. As a country, we have become so flippant with finances (both public and private) that we have forgotten how to be responsible and not leverage everything we have, including our own future.
It is time we pay the consequences for our own misdeeds. Unfortunately, this will include people who have remained responsible with their own finances. It is not “fair,” but as others have voiced, life is not fair.
Lynnea I hate to break the news to you but the Government is very involved in health care, it maybe for the most part run by private companies but the Government is front and centre, not just in medicare or medicaid but in every single aspect of it. Who do you think regulates the whole thing, sets the standards of care, tells us what drugs we can and can’t take, pays doctors education. Why do you think the number one lobbyists are health care.
Secondly you mention that the goverment does a horrible job of managing other peoples money. That’s a big misrepresentation. The goverment doens’t manage anyones money. You manage your own money. The goverments job is very simple, to take our money in the from us in the form of taxes and in exchange provide servides and infastruture.
Kyle: regarding SS you are very much in a minority on that one. Bush gave up very quickly on that one for a good reason. Just ask anyone who who is close to retiring what they think of the idea of “privatising” SS. Considering the the market is down some 40% and with the real possibility of going lower I’d be extremely worried right now. Also SS was brought in because of wide spread poverty.
I used to think I was fairly conservative untill I started reading blogs like this :)
Lynnea if your really interest in Health Care I suggust checking out Mike Magee’s blog Health Politics
i agree with your post! I know this is kind of a young person thing, but one thing that made me mad was in high school, the teachers were not supposed to take off late marks for assignments handed it late. instead there was a set in stone due date and anything after that was marked as “0″. well i would always work hard to hand things in on time, and then of course other people would hand things in a few days later and the teachers didnt want to stick to the rule so they would just let them do it. it wasnt fair to the students who worked really hard to have it done on time.
Lynnae perhaps what you meant was that the government does a poor job of giving us value for money and that if everything were privatised thing were run better.
Secondly I assume that you prefer libertarian dog eat dog world, where winner takes all. If you succeed great if you fail you lose everything.
I am personally mystified why Americans accept a health care system this so third world in it’s delivery. America has the best health care bar none in the world, if you have money!
Secondly why Americans so willing pay through the nose for such poor coverage. When you add the cost of your health care in you probably equal the worse of the tax and spend countries in Europe in take home pay.
Linz
Using your statement every President has changed the role of government. Social Security keeps 1 in 5 elderly from being reduced to eating cat food and living in poverty. You’ll have to forgive me if I don’t consider that a bad thing. I am proud of it. Do I think Social Security should be reworked(personally it wouldn’t be in such bad shape if the government didn’t use it as a “slush fund” for projects like war)? Sure it should have been placed in lockbox status along time ago. Do I think it should be eliminated? No way. Any program that keeps one in five elderly from being in poverty and is not reliant on investment cycles(Thank God, Bush didn’t get his way with investing it in stock market)is good with me.
Rob – We don’t necessariy ‘accept it’… but at the moment it’s the only game in town and we are stuck with it! That’s why we try to change it, to no avail so far.
@ Rob in Madrid;
I couldn’t have said it better myself. Why do we Americans, as a country, put up with healthcare that is 3rd rate and 3rd world in it’s delivery? We pay through the nose and act as if we enjoy not only paying a premium but getting substandard care as well. I will never, ever understand this line of thought.
@Lynanne,
I guess we will respectfully disagree then. When you write that “My daughter and I got turned down for private insurance, due to pre-existing conditions, and now that we have insurance again, the amount that we pay is outrageouse,” I really question why you would be against a government funded healthcare program. Do you honestly believe that you will have to call up a senator to get pre-approval before treatment? Where does this notion that the gov’t will “manage healthcare” come from? Doesn’t it follow that we pay enough in taxes to support a universal healthcare program, paid for by ALL taxpayers and for ALL taxpayers, and that a gov’t agency could run it? We could follow the models of other countries where it is funded through tax dollars and run by, dare I say it, doctors? Wouldn’t it be nice, Lynanne, if you could get sick, really, really sick, and know that you wouldn’t lose the house that you just worked so hard to get?
And before everyone starts telling me lines like “love it or leave it buddy,” don’t bother. I’ve already decided to “leave it.”
How people can be so against something that we should already have and would be a benefit to so many is really beyond me. If you think the healthcare system is so spectacular, come to the city and work in a hospital ER with me.
Now, I apologize for the tone of this post in advance. Everyone has one or two topics that get their blood boiling, and this happens to be mine. I didn’t start out to make it sound that way. :(
Paul, a lot of my feelings about government run healthcare come from how I’ve seen the state of Oregon run the Oregon health plan. Doctors won’t take patients, because they can’t afford the measly reimbursement that the government gives them. OBs in rural counties stop delivering babies, because the amount they get paid by the Oregon system isn’t even enough to pay their malpractice insurance. The government decides what procedures are necessary, and which ones aren’t. They turned down a young, married gal for a heart lung transplant several years ago, because the transplant was too experimental, and it wasn’t a cost-effective treatment. And even more recently, a lady with cancer couldn’t get chemo, but the state would help her pay to end her life.
I’d much rather pay out the nose and make my own decisions than rely on what the government says I need or don’t need.
Beyond that, the government uses things like healthcare and education to pull at the heartstrings of the citizens. They meet to approve the budget, and they fund all their pet projects first, so they can come to the people and say they need more money for healthcare or education. I’m not too keen on giving up any more of my hard earned money, even if it’s for something necessary, until the government shows me they really know how to cut out what isn’t necessary. I’d much rather spend my money frugally and make decisions on what I need to do to prepare for retirement, secure healthcare, educate my children well, and anything else, rather than letting the government take my money, allocate it, and then tell me what to do.
And I agree with Marci that I don’t necessarily accept the system as it is. I know we need change, but I don’t trust the government to fix it.