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Why I'd Be Happy with a 40% Tax RateBy Jeff ClarkTuesday, June 22, 2010 It was an overcast Saturday afternoon in London when my family walked past "Protest Park" – the designated area where Londoners with political opinions can speak their peace without the need for permits or security.
There were 40 or 50 tents and at least as many signs drawing attention to the many "abuses" of the world...
"End The War"... "Stop the Dictatorship in Swaziland"... "Free Tibet"... And on and on and on.
However, the sign that caught the attention of my wife and I was painted in large, black, bold letters on a green backboard:
"CAPITALISM HAS FAILED. THERE ARE OTHER WORLDS."
The protestor holding the sign was about 30 years old and wearing a Che Guevara t-shirt. My wife looked at me as if someone had just insulted our kids.
"You need to say something to him," she said.
Normally, there's not much point getting into a sidewalk debate with a political protester. It's bit like wrestling in mud with a pig. You get frustrated and dirty, and the pig has a good time.
But this time was different. I was on vacation in a foreign country. I was relaxed and having a great time. And my wife laid down the gauntlet.
I approached the protestor...
"How do you know?" I asked.
He looked at me the way a 4 year old looks at a brussel sprout. "What do you mean?" he responded.
"Capitalism," I said. "How do you know capitalism has failed?"
The protestor went into a five-minute tirade about the evils of capitalism and greed, about how countries like America and Great Britain were responsible for all the plights of civilization. He cited the British Petroleum disaster in the Gulf of Mexico. He blamed Europe's financial woes on the greedy bankers and corporate CEOs who profited off the backs of the average working stiff. And he declared the world would be a much better place if everyone would just share some of what they have with those less fortunate.
"How much should we share?" I asked. "For example, if I work 12 hours today driving a cab, and you spend 12 hours lying in the grass and staring at the clouds, how much of my income should I share with you?"
He paused for a moment, and then answered, "Forty percent. I think if everybody kept 60% of their income for themselves and then put 40% into a general fund for the benefit of mankind, the world would be better off. It's a great trade off. You get to keep the majority of what you make. Yet, you still make a large contribution to the bigger cause."
"In other words," I said, "you prefer socialism over capitalism."
"Of course I do." he answered. "Socialism is a far better system."
I then launched into my own little tirade and explained to the protestor that nothing resembling capitalism has been seen in my country since the early 1900s. We have an income tax of nearly 40%, social security tax of 7%, state income tax up to 11%, state sales tax, county sales tax, gas tax, luxury tax, property tax, and an estate tax. Furthermore, all of these taxes will likely increase significantly over the next few years as we incorporate more social programs like government run health care and college education funding for all.
Indeed, America has been an increasingly socialist country for the better part of several decades. If I could get away with sharing just 40% of my income with the government, I'd sign up for it in an instant. And I suspect most taxpaying citizens would do the same.
"What you should do," I suggested, "is take a big Magic Marker pen and make a new sign that says...
"SOCIALISM IS KILLING US. LET'S GIVE REAL CAPITALISM A TRY."
"I don't like you," he grunted. "There's just no getting through to some people."
He then turned, walked back to his tent, and sat down in the grass – next to another protestor holding a sign which read...
"Open Your Eyes and Open Your Mind."
That's good advice.
Best regards and good trading,
Jeff Clark
Further Reading:
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