NJ Governor

[dazzleman]

You're surprised the McGreevey raised taxes?  What did you expect when you elected a Democrat?  I haven't seen a Democrat lately who could stand up to the special interests who have their hand out for your tax money.

I don't know NJ politics that well, but I had heard of Bret Schundler and I'm sure he would have been better than McGreevey, especially since McGreevey was the darling of Hillary Clinton the last time he ran.

Is Andrews from South Jersey or North Jersey?  New Jersey is really like two different states, and I imagine it makes a big difference what part of the state a candidate is from.

[dazzleman]

As opposed to the special interests who have their hand outs from tax cuts?

Of course, the major difference is that the "special interests" you speak of are those the majority of tax payers can benefit from (public transport, education, etc).

I don't consider individual taxpayers as "special interests" for being allowed to keep a little more of their own money.  I guess that's the difference between a Republican and a Democrat.  A Democrat considers lower taxes, rather than wasteful government spending, as a "giveaway program."

I don't deny that there are public needs, but a person would have to have really rose-colored glasses to think that government is not wasting a lot of money.

[dazzleman]

What exactly is a "vested interest?"  And who do you think pays taxes on behalf of corporations?

It all comes down to individuals.  Individuals either pay their own personal taxes, or pay taxes on corporations in which they own stock in the form of reduced dividends and earnings.

When you increase taxes, you are taking money away from individuals that they have earned, in order to give it to someone else.  The "someone else" in this case is what I would consider a vested interest.  It may be the right thing to do, or it may not, but I've seen few Democrats lately who ever thought that taking more money from the individuals who earned it wasn't the right thing to do.

As I said earlier, that is the big difference between a Republican and a Democrat, that a Democrat could define a person keeping a greater share of his/her own money as a "vested interest" rather than defining the person looking to receive the other person's money as a vested interest.

[dazzleman]

Yes, Dazzleman, one of the fundamental differences between liberals and conservatives is that liberals believe that the wealthy have a moral obligation to society to give a small portion of their money back to the less fortunate, while conservatives believe that they should be allowed to keep it.

If you read some of my prior posts, you will see that I have supported a graduated income tax with high income people (this doesn't necessarily mean wealthy, particularly in a high cost of living area) paying a larger share of their income in taxes than lower income people.

But liberals don't want the wealthy to pay a small share; they want a large and increasing share.

And my point was the way liberals look at tax cuts.  They consider tax cuts, rather than say, welfare, as a give-away program.  Whatever you may think about government spending, it is a factual error to call giving people back their own money a giveaway program.  A giveaway program can only involve giving away somebody else's money.

I could also make the point that the way in which liberals have chosen to help the less fortunate has often hurt rather than helped them, but that's a different topic.

[dazzleman]

I think a big issue for the future is how to provide the best standard of living for the greatest number of people.  This issue will come to a head in the next two decades, as the traditional government-based programs for doing this increasingly fail or come under intense fiscal pressure.  We already know that in the long run, social security and medicare cannot be maintained in their present form.  Welfare got so out of control that we repealed the welfare entitlement, and turned attention to getting people on welfare to work, even if at menial jobs, and even if they have small children.

There are two competing schools of thought.  The first is that we should continue to help those less well-off through maintenance, or income redistribution, programs.  This is essentially the argument that you are making.  The wealthy transfer more of their income to those making less, and it ultimately helps everybody.

The problem with this approach is that it provides no help in the long run, unless the maintenance is continued, usually at ever-growing levels.  It does help the politicians who wish to exploit the plight of those less-well-off, by making them dependent on those politicians for their very livelihood.  It's also not clear that this type of spending really benefits society as a whole; it seemed that the more we spent on welfare under the old AFDC system, the more problems we created, because we were subsidizing and encouraging the type of behavior (primarily out of wedlock births) that inevitably leads to poverty.  Every year, the problems just got worse and worse, even as spending increased.

The other approach is a wealth creation approach, geared to helping people to create enough of their own wealth to take care of themselves.  This begins with education, but also involves creating a larger investor class and providing the right incentives and opportunities for people to build their own wealth and to have it with them throughout their life, under their own control, not that of the politicians.  The 401-K is a good example of this, as is the proposal for people to fund their own private social security accounts.

I prefer an approach that encourages and facilitates people developing the wealth to take care of themselves.  I think this is far preferable to a maintenance type policy, in which the "rich" just keep paying higher taxes to transfer to those with less.  Dependency is a bad thing, and people should be encouraged to be as independent as possible.

I also say that if you're looking to take 40% of somebody's income, that's a large share.  That's not a small share.

[dazzleman]

One thing I would say is that you can't assume that government does things more efficiently because it doen't have a profit motive.

In government, it is called something different -- pork.  That is government's version of profit, and the only difference from business is that pork is obtained by greasing the right palms and having influence over the right people, as opposed to, in theory, working to earn it.

There are certain jobs that don't lend themselves to for-profit institutions, and must be done by government or not-for-profit companies.  But you can't assume that the elimination of the profit motive makes things more efficient.  If that were true, the Soviet Union would have had the most efficient economy in the world.

Sometimes, the profit motive encourages people to find better and more efficient ways to do more with less.  When you eliminate the profit motive, people generally find ways to do less with more.  Over time, government always evolves in the direction of gobbling up increasing resources to do the same thing, until the taxpayers are fed up and are forced to radically restructure or eliminate the program.

The other point I would make is that having entitlement programs creates a need for them to a greater degree than existed before, as people adjust their behavior accordingly, in a negative way.  Welfare is a perfect example of this.  Often, the creation of the program makes the original problem worse, as people develop an entitlement mentality and know that they don't have to try too hard, since they have the program to fall back on.

I find that many liberals operate on a "static model" theory, assuming that somehow, it is pre-ordained who will be well off, versus who will not be.  This is true in some cases, but in many cases, those who started out well in life messed up, and lost their wealth, or potential for it, and those who started out badly became very successful.  I don't think that the poor represent a permanent class as much as many liberals seem to assume.

The static model theory also applies to wealth creation.  As you take people's wealth away from them to give to others who didn't earn it, they create less of it, leaving society as a whole poorer.  Many liberals don't factor this in, and believe that the wealthy will continue to create the same level of wealth in order to have it taxed away, but this is not the case.  I think the explosion of wealth that we've had in the past 25 years is related to the sharp lowering of our marginal tax rates, from 70% to the 35% range at this time.

This greater overall wealth benefits those who have earned less in the sense that it creates more opportunities to help those who are not as well off, in a way that's not as painful to those who have some money.  I think that has a lot to do with why affluent suburban areas have become more liberal -- they are wealthier than they used to be, and it's now not as painful for them to pay higher taxes to, in theory, provide opportunities for others to succeed.  It can be a win-win scenario if managed correctly, but I think that liberal great society programs mostly went in exactly the wrong direction, creating more poverty rather than eradicating it.