Free Liberal

Coordinating towards higher values

Bail Away, It Ain’t My Money

by Micah Tillman

As much as I find the recent government bailouts revolting, I can’t get as outraged as some. They’re not using my money. Any money that came from me stopped being mine on April 15th.

So bail away, dear government. It’s your money to waste as you like. (Though I would appreciate it if you didn’t ruin the world in the process.)

Too often, people see the government as a kind of estate manager. The trust’s assets belong to us, but the government has power of attorney. Or however those things work.

But that’s not how it is with government and taxes. April 15th is the day you pay the government not to incarcerate you for another year. You purchase “protection” (á la the mafia), you don’t make a deposit in some collectively-held, governmentally-managed fund.

Or, to put it less-positively, taxation is more like theft than investment. Is it really outrageous that thieves would waste the money they stole? They obviously didn’t have much of a sense of ownership, stewardship, propriety, etc., in the first place.

“Give me all your money.”

“Okay. Here it is. Don’t spend it all in one. . . . Wait! Especially don’t buy candy with it! Save it for our kids’ college fund!”

Furthermore, the idea that “taxpayer money” really belongs to “us,” to “the taxpayers” smacks of collectivism. “We” don’t own the money anymore than “we” own the “airwaves” (or the off-shore oil fields, or the national parks).

At most, each of us owns some minute fraction of the money.

But to say we “own” even a fraction is meaningless. You probably never saw “your” tax money. (It was taken out of your paychecks before the checks were even printed.) And you certainly haven’t ever gotten to use it.

If you can “own” something you’ve never seen, never used, and can’t control, then you’re talking about “ownership” in a sense that is . . . well, meaningless. The distinction between owning and not owning becomes a distinction that makes no difference, as the saying goes.

And don’t give me the, “It’s ours because it’s controlled by our representatives” line. “Representatives” in politics are not like “representatives” in estate-management.

Besides, my “representatives” in Congress aren’t even from the same party as me, much less the same section of the ideological spectrum. They do everything I don’t want them to do.

They may represent the majority in my state, but I’m not a member of the majority. (And if you’re reading this, you’re probably not in the majority in your state either.)

The idea that politicians are using “our” money to bail out corporations and that they are doing this as our “representatives” is a useful idea. For politicians. It keeps you hanging on to the illusion that government is “We the People,” and therefore that you really should be cooperating with it.

But the ideas of collective ownership and representation are simply tools for the pacification of a populace. We’re not living under a tyranny (or monarchy, or whatever it is that representative democracy is supposed to be the alternative to) so long as the money being spent is still “ours,” and the people spending it are our “representatives.”

Getting angry that your representatives aren’t representing you properly because they’re misspending your money (to the tune of billions – even though you’ve never paid a billion in taxes), therefore, is a sign that you buy the propaganda.

But you don’t fight the Man by thinking the way the Man wants you to think. Nor do you combat collectivism by talking like a collectivist.

I will admit, however, that the recent bailouts remind us of all the reasons we have to be angry about our government. Let’s just not get angry for the reasons they want us to get angry.

Let’s make sure our outrage doesn’t play into their hands.

We don’t want the distinction between revulsion and sympathy to be one that makes no difference.

Micah Tillman is a lecturer in the School of Philosophy at The Catholic University of America.


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Comments

Your money seeks being yours when they garnish it, not when you file. You can compare it to theft, but it really isn't. The vast majority of Americans are here because their ancestors chose to be here. We are a nation of people who's family tree is transplanted (with the exception of those who were brought here in chains, but many of them are of mixed heritage). Unlike most others in the world, we have it in our DNA to vote with our feet. Still here? Its because with all its flaws we have more power over our tax dollars than most anyone else.

Now, as to the bailout - they didn't use taxpayers money - they printed it.

It will impact us in higher inflation and a weeker dollar, and eventually higher interest rates so that the dollar is restored to value.

Hopefully, these deals won't be the straw that breaks the camels back. The odd thing is, Greenspan supported the Bush tax cuts because he did not want the debt to be paid off, forcing the Federal Reserve to back its assets with private debt and equities. Now the Fed is printing money to buy failing assets in, you guessed it, private equities, to reverse a financial panic that arose largely because the Fed dropped the ball, along with the SEC, in enforcing financial regulations and sound financial principles(borrower ability to pay, regulations regarding actually holding a stock before selling it short, etc.). Finally, the oil shocks have, as one of their causes, the weak dollar which was made that way because of too low interest rates and too high borrowing to cover the deficits caused by the War and the Bush tax cuts on dividends and high incomes.

Most on this board, BTW, aren't even close to those high income brackets, which is why I get so vexed with libertarians complaining about high tax rates that they don't even pay.

# posted at by Michael Bindner

"Most on this board, BTW, aren't even close to those high income brackets, which is why I get so vexed with libertarians complaining about high tax rates that they don't even pay."

The quality of an idea shouldn't be decided by its effect on me.

# posted at by Jeff Stallard

Sorry for the confusion, Michael. You'll notice that I wrote later in the piece:

"You probably never saw “your” tax money. (It was taken out of your paychecks before the checks were even printed.)"

It's just that April 15th is the day most people file, and is colloquially associated with paying taxes (it's the day you have to make up the difference between what was withheld and what you owe, if the former was less than the latter, for instance).

Finally, I'm surprised that you're concerned about people not being more selfish:

"Most on this board, BTW, aren't even close to those high income brackets, which is why I get so vexed with libertarians complaining about high tax rates that they don't even pay."

You're not alone in your concern, obviously. But it's still a surprising concern.

libertarians aren't just pissed off at the high tax brackets, we're pissed off at all income taxation. Especially since the income tax doesn't actually go to pay anything except the national debt owed to the private central banking system. Remember that if you cut the income tax to nothing today, you'd still have the ability to finance a government the size of the 2001 US government

# posted at by peters

Nice article. I love your point about a a thief taking advice from their victim. You are absolutely correct and IMO it is just another symptom of the fact that language is being turned into some kind of perverted doublespeak by crooked politicians and the media who love them.

Now I don't pretend that this is a new phenomenon (just read some Mark Twain and you'll see its been going on for a long time), but it does appear to be getting worse than it was in the early 1900s. Hell, its worse than it was in the 1970s. The root of the problem is education, and a broken system that would rather indoctrinate than educate.

The underlying problem with the bailout is that it is another example of the extreme waste of resources that the Federal (and State) government represents. At every level money is thrown away like it is so much trash. Maybe two or three thousand dollars is just a drop in the ocean of a 6 billion dollar a year agency, but its a good chunk of money to me. It could be the difference between buying a new car, or suffering another year with the clunker POS I'm driving right now. Why the hell am I working so hard to support a government that is never satisfied or satiated? I'm sick of their messes taking money out of my wallet, whether directly with higher taxes, or indirectly by their stupid inflation creating policies.

I say, let Fannie Mae and Freddie Mac and the insurance companies all go belly-up. Another enterprising company will take their places. They will buy those loans for pennies on the dollar and then they would be in a position to renegotiate those loans with the property owners one at a time. Screw publicly funded home loans. If I'd known I'd get a bailout, I would have bought a million dollar home and opened a loan brokerage.

As for the PMI companies, they rolled the dice and THEY LOST. I think the entire concept of PMI is bs to begin with (what other business requires customers to buy insurance for them?) I'm sure that these insurance companies underwriting these loans made money in truckloads, for a while. Now its time for them to close their doors and go find honest work.

# posted at by David Eisenbeisz

The unseen tax: inflation. The central government forces us to use the central banks money. Then, when we were paid when-a-dollar-was-worth-a-dollar, we are taxed (or forced to buy food, clothing, gas, etc.) when-a-dollar-is-worth-fifty-cents (-of-what-it-used-to-be-worth). That is a monopoly enforced at gunpoint.

# posted at by Bleu

The collection of progressive income taxes is more "equitable" than less "concious" collection methods, such as the Fair Tax, which is a bit more likely to invite evasion and does not lessen filing burdens (or evade the "perjury trap" any better than progressive filing).

Suddenly stopping collection is also not an option.

There are many who support progressive income taxes on principle, not out of some desire to steal your money.

Additionally, the economic reality is that a uniform tax rate (even with a prebate) would decrease economic growth as the vast majority at the bottom would reduce consumption while those at the top of the income scale would save more - and would accumulate savings at a rate faster than those at the bottom, who can barely save at all.

Progressive tax rates at the top spread the burden of taxation more to the top so that the wealthy's ability to save is decreased while the ability of the less wealthy to save is increased - allowing them to build a stake in the economy beyond consumption.

Finally, a progressive tax structure is necessary to compensate for the transfer of wealth to the wealthy through the payment of net interest on the national debt. Without such adjustments, an economic aristocracy of debt holders is perpetuated by governmental action.

# posted at by Michael Bindner

Michael Bindner,
There wouldn't be a transfer of wealth to the wealthy through the payment of net interest on the national debt if the government did not borrow money to further bloat itself with. And in arguing that progressive tax rates increase economic growth you have only the most socialistic economists supporting your argument (others tend to admit that progressive income taxes hurt economic growth but justify it on redistribution grounds).

# posted at by economist

Only if you call Keynes a socialist.

I ran the numbers on the effects of Democratic v. Republican tax policies. Republicans need to borrow to get growth because increase funding to taxpayers with a higher marginal propensity to save. In order to increase spending and decrease speculation (which comes from cutting dividend rates, marginal tax rates and capital gains rates - note that the 2000 recession happened one fiscal year after Clinton acquiessed to capital gains rate cuts in order to throw an olive branch to the GOP for getting head from an intern). The Democrats raise these rates, growth increases and stabilizes at 3% per year, even if the deficit plus net interest (or surplus net interest) is positive - precisely because that surplus plus net interest is less than the increased revenue from increasing marginal tax rates.

Supply side has never worked. The entire economic effect produced by deficit financing is Keynesian. A pure supply side solution can only be demonstrated if tax cuts to the rich occur while the budget stays balanced. That hasn't ever happened. If you claim it has, please provide the data.