Note: Some of what I am about to say, you may or may not agree with. I am ok with that. I am glad we live in a country that allows both of us to express our opinions, even when they might differ. I am guessing this post will garner quite a bit of discussion. I only ask that all comments are kept clean and respectful to each other.
I did my taxes the other day. It was depressing. Not as bad as it could have been, but still depressing. I understand the need to pay taxes. I agree with paying my fair share. I want the government to be able to provide me with the things that there is no way I could provide for myself. I can't pave a road. An army of one is not actually a literal thing, I need them to do that for me. Education, police, courts, ect, all of these are very important tasks that my tax dollars (and yours if you are in the US) go to cover. And I gladly give up my money to pay for these things.
So why am I so depressed about doing my taxes?
Well, philosophically, I have always been of the opinion that taxes should go to cover the things that I cannot provide for myself. I am also a believer in a limited welfare system, one that is meant to help people get on their feet and not make them dependent on it. I am even ok with our nation providing for a limited amount of international welfare. I think its awesome that our country chips in and helps nations recover from disasters. However, beyond this is where I and my country seem to differ in opinion. Our government seems to believe that there is no actual cap to spending.
You and I, like anyone else on this planet, have a limited amount of money. Even Bill Gates has a limited amount of money, even if his limit is slightly more than mine. Each month, my wife and I sit down, we look at the money we bring in, we pay out the bills, and what is left at the end is either saved, used to reduce debt, or we spend it. Much of this process is automated (thank you online banking!), but the process still occurs. In our past, it wasn't uncommon for us to have to decide if some things needed to be cut, or unfortunately, like any couple who struggles, even not pay something on time. You can only NOT pay something for so long however, as the people you owe seem to get a bit snippy when they don't get paid and they might even come get your things for not paying. In this country, in the last few years, foreclosures on homes have been at all time highs. See, when you don't pay your bills, that happens. Unless you are the government.
Sometimes you have to look at your expenses and decide to cut some of them. People will reduce or eliminate cable/satellite TV, find cheaper forms of auto insurance, not go out to eat, turn the thermostat back a bit, or even make harsher decisions like getting a 2nd or 3rd job, selling off personal assets, or going without insurance at all so they can make ends meet. Sucks, but thats reality. Unless you are the government.
We have to make hard decisions every day. Herein lies the issue. Some people in our country seem to think that the government should provide for them. I don't mean temporary assistance, I mean they actually want the government to provide for them. Big Daddy Warbucks style. People demand the government extend unemployment benefits, provide a greater welfare system, provide national forms of healthcare. In principle, I have issues with some of this, but even if I fully supported all the initiatives that are out there now, the bottom line is quite simple, our government cannot afford it. More specifically, we the taxpayer cannot afford it.
If my kids came to me and said "Dad, give me $50." and I didn't have $50 to give, they wouldn't get it. Sounds simple enough. Even if I did have it, they still might not get it. I believe all things should be earned.
Our nation needs strong leadership. Leaders who are unafraid to make the unpopular choices and decisions. Frankly, we need a leader who is willing to make the decision to cut things, just as we do in our own households. Since 1970, we have had a balanced budget 4 times. In 42 years, with the exception of 4 years, we have outspent what we brought in. It wouldn't even be possible for any of us to do that, you would be bankrupt and homeless long before then.
The national debt is currently $135,482 per taxpayer right now. Our national debt exceeds our nations GDP. Our current nations liabilities, between Social Security, Prescription Drugs, and Medicare are over $117 trillion dollars, or put another way, over $1 million dollars per taxpayer. These are just the factual numbers. I am a realist. I never want to see people suffer, but the cold hard reality is that without hard, unpopular choices being made, the suffering will increase. We can no longer afford to keep passing out the benefits as they are, foreign or domestic, and we can no longer afford to spend more than we make.
So back to the original question, why am I depressed?
Reality. In each of our lives we have but two ways to get a budget in line. Earn more or spend less. (or some combination of the two most likely) For the government to earn more they must collect more taxes. That means taxing those of us who are paying more, or getting more people into taxpaying situations. For the government to spend less, they have to cut programs. In our case, cutting frivolous programs is not a complete answer. I fear we have gone too far and now we have to go from cutting the fat to cutting into the bone. Good, worthwhile programs, that help the American people will have to take hard cuts or even be eliminated all together. To implement a national healthcare system, and still balance the budget and reduce the national debt, even more would have to be cut from somewhere else. The problem is, our history shows that we don't cut spending, we only increase it. What programs should be cut? Who suffers? How do we increase the nations income to cover our expenses and start to eliminate some of the debt? All questions that require hard and unpopular answers.
How much more of the money that I and my wife work hard to earn, so that we can provide for our family, should be taken from me to provide for others? At what point do we decide that there are some things the government is not meant to provide? Or do we just decide that a tax rate of 50% is acceptable and in exchange we will all become dependent upon our government. Do we want to rely on our government that much? I don't. I would rather rely on myself.
This year my household income was on par with last years. This year, I paid more in taxes than last year. This is not a trend I like, but its reality. What is really scary is that the national debt increased. How high will my taxes go in the future?
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Thank you for all the great feedback. I really appreciate it. As always, feel free to leave comments below.