As I See It: Pie crust promises
More taxes on the richest corporations won’t solve inflation; it may actually increase it!
Do you believe the government can fix inflation? I don’t.
If you dissect a family’s budget, the first thing you find are the major expenses - housing, food, clothing, medical and transportation. Some will add education, communication (internet), entertainment and child care to that list. Another category is taxes.
Beyond income tax, Social Security and Medicare taxes, there are sales taxes levied by local and state agencies, real estate taxes, gasoline taxes, taxes on your telephone bills and myriad fees government agencies charge for their services.
It is really difficult to determine the total percentage of a person’s income that goes for taxes. In Minnesota, it is estimated the state tax burden is about 3.5% of an individual’s income.
Federal numbers are hard to find too; the “average” figure is around 12%.
In terms of goods and services, we have no way of determining what percentage of the price we pay for goods and services is actually paying the taxes a corporation or company pays. More taxes on the richest corporations won’t solve inflation; it may actually increase it!
The better story is what happens to the money we send to federal, state and local government agencies.
To begin with, the money we “donate” in the form of taxes and fees to all government agencies is supposed to be spent on our behalf for the benefit of all. Right off the top, a chunk of tax revenue is spent for the salaries and benefits of all the people who are employed by each government agency or entity.
So, the larger the agency, the larger the amount of money they are going need just to open the doors. That’s before they even start to do their job.
I hope you begin to comprehend why so many people believe the government is far too large.
Then we get to the actual purpose of an agency and who benefits from their work. The Department of Revenue is pretty easy to understand; except at times it has been used as a political tool to favor one side and punish another. However, it is the one you really don’t want to mess with.
Homeland Security is extremely important, but I don’t think they have done well on the southern border. Do you? And they have yet to figure out that all supremacists can be a threat - regardless of race or color. Justice is another area that can be turned into a political weapon. Have we found any Russian collusion yet?
At least the citizenry still has positive feelings about defense - especially the military. But even there the politics of decisions on funding sustainment and the acquisition of new weapons systems can be problematic as large corporations are the money-hungry half of the military-industrial complex former President Eisenhower warned us about.
Other agencies - Health and Human Services, Agriculture and Education - sometimes represent other black holes swallowing millions of our money. They include a number of the numerous entitlement programs - Food Stamps, Medicare, etc., which are basically open-ended checkbooks that never run dry, unless the government runs dry.
But the government never runs dry as long as it can print money - which it does, and does, and does.
And that is one of the many reasons for ever-increasing inflation. There are many additional factors. In my opinion, those factors in rank order are: crippling domestic oil production; the stagnation of the economy (and the supply chain) inherent responding to COVID-19; the near-global impact of Russia’s invasion of the Ukraine; refusal to address budget deficits; and the costs of unrestrained immigration at the southern border.
Of course, that’s only my opinion, but the ineptitude of our government is clearly reflected in the explosive inflation and the increasingly empty spaces on store shelves. I fear that may also be reflected in the empty spaces in the heads of some politicians.
The president’s pledge to fix inflation and so many other things are just pie crust promises - easily made; easily broken.
That’s how I see it.