Wednesday, April 22, 2009

Taxes

The tax protests last week were amusing (and the coverage was just downright comical).  The problem is that they were long overdue and the angst was misdirected.

 

It’s also quite clear to people who think while they fill out their taxes that the federal tax burden TODAY is just about as low as it’s been for the average person in the US.  Add to that a decrease in the payroll taxes that hit earlier this month and protests about over taxation seem a little …  uh, nearsighted.

 

However, if you take that historically low tax burden and put it up against a trillion dollar deficit (inherited from the previous administration), which will be followed by another trillion dollar deficit (created by the current administration), followed by a series of deficits higher than any other ever recorded in the history of the republic, save the two deficits previously mentioned, and you can see an impending problem with math.

 

Somewhere along the line, taxes are going to have to be raised or spending is going to have to be cut.

 

Or the dollar is going to have to be inflated.  A lot.

 

But, of course, the protesters didn’t get a chance to make that statement when they were being berated by “reporters”, nor is one certain that they could have formulated that sort of rational argument.  But something is going to have to give, and my hunch is that it won’t be spending.

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