"Instead of having all of us pay our fair share, we've got over $1 trillion worth of loopholes in the corporate tax code," he said. "This isn't the invisible hand of the market at work. It's the successful work of special interests." This claim by Obama sounds good to the ears of millions of U.S. voters struggling under the weight of an oppressive, draconian tax scheme.
When there's a problem our politicians are good at finding an evil culprit taking advantage of the poor working class. For Obama his target is the greedy corporations and their special interest henchmen. The results, according to Senator Obama, "gaps in wealth in this country grow wider, while the costs to working people are greater." Armed with the rhetoric designed to stir distrust, fear, and anger Obama's message combines with our current economic crisis creating an ever increasing lead over his opponent.
In an attempt to contrast the two candidates plans on individuals, in a non-partisan way, Jeffrey Gramlich produced a good review entitled The McCain and Obama Tax Plans for Individuals. Mr. Gramlich does provide a straight-forward look at the two plans as it effects us yet still does not address an inherent flaw that neither the Obama or McCain camp are willing to discuss with us honestly, Obama's reliance on increasing corporate taxes rather than taxes on individuals.
Economist Walter Williams' 2003 article, Taxation 101: Who Pays Corporate Taxes, stated the flaw very clearly. "A subject area in economics, called the incidence of taxation, says that the party upon whom a tax is levied does not necessarily pay the tax. They might shift it onto some other party. That's precisely what corporations do. They are merely tax collectors."
Under the Obama tax plan this "incidence of taxation" will increase the overall tax burden on corporations by not only increasing the amount they are taxed but also the cost of calculating taxes. These increased costs are shifted to both consumers and labor, just as we see them shifted today under our current income tax system. His plan continues to raise the costs of goods and services.
The short-term effect on individuals, especially those who still have children at home, may be a lowering of their yearly tax burden. However, individual purchasing power will be reduced as prices increase and an individuals very means of earning a living are placed in jeopardy as companies are still encouraged to find a better environment, economically, to operate within. This long-term negative impact on consumers and labor are not mentioned by either campaign simply because the income tax system is one both parties rely upon to maintain control of the people.
With an income tax system designed to take the earnings of companies and people directly from them freedom is replaced with servitude. Ron Paul in his book, The Revolution: A Manifesto, explains it this way. "The income tax implies....government owns you, and graciously allows you to keep whatever percentage of the fruits of your labor it chooses. Such an idea is incompatible with the principles of a free society." McCain cannot attack the flaw of increasing corporate taxes without highlighting the foundational problems the founders attempted to avoid by making income taxation unconsitutional.
True change is not going to be found in Obama's plan. McCain's plan also produces no true change. Any income tax system, whether heavily weighted to tax individuals or corporations is quite simply more of the same which has led us to the servitude of the people to the government since 1913. Don't be fooled by the fearful rhetoric of either of these candidates or the parties they represent. If you favor servitude over liberty, control over freedom, and deceit over honesty at least understand the future you support.
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©2008 by Gary Wood
Columnist, radio show host, and co-founder of Hear My Thunder.
©2008 Gary Wood, all rights reserved. You must have written permission from the author in order to republish this work.
Published: Sunday, October 12, 2008
Last modified: Sunday, October 12, 2008
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Reader Comments:
Posted By: Jake in Seattle
Date: 2008-10-23 00:31:25
The American Dream as we were brought up to understand it is on it's way out. If Obama gets his way, then the American Dream is dead in the water, so poor people can feel that they have stuck it to the man - however there is no man, as you stated the corporations will simply adjust to the increase in taxes by further outsourcing jobs, rolling layoffs, increasing prices on goods and services etc. which will strip that 95% of Americans Obama speaks of, of everything they have come to take for granted. Namely their livelihoods, savings, economic freedoms etc. that the free market provides. Fuget about it ~ the government owns your productivity, so why work hard ~ since your efforts will not be rewarded (because Obama will take any gains away from you to give to the poor). All the while Mr. Obama pays no taxes himself, so what does he care.