Call me a geek, but I was surfing the Bureau of Labor Statistics web site today. I came across a seldom mentioned statistic that I had heard in the distant past, but that was brought home to me more directly after thinking about the implications. Only 64% of all Americans are working today – that includes both full and part-time employment. This is down from 67.2% in January of 2001. This is not a trend to be proud of.
Given that roughly half of working Americans paid no Federal Income Tax in 2010, this means that 32% of all Americans are footing the bill for Federal Government expenditures, including the amounts that social security, Medicare and Medicaid “borrow” from the general fund. And given that roughly 10% of those paying Federal Income taxes account for 70% of all tax receipts, then it stands to reason that 3.2% of all American are footing the majority of the Federal expenditures for the rest of us. If this isn’t a definition of success for the redistribution of income, then I don’t know what is.
You know, when politicians claim the rich aren’t paying their fair share, I want to just scream. What is fair about someone not paying any income tax and then claiming they have a right to someone else’s wealth through the force of law? What is fair about 3.2% paying 70% of the total bill for the other 96.8%? The answer is “nothing”. Nothing is fair about this – but since this group is a perpetual minority, they can be hammered all day long because just out of sheer numbers, the majority who pay no income tax are not going to vote to have their taxes reinstated and will happily take money from the small minority. This is nothing more than selfishness infused through divisive class warfare.
What’s equally disturbing is that while our workforce has been declining, our spending has been going through the roof. We paid for two wars totally on borrowed money and now we’re paying for a host of new government workers and services, 42% of which is paid for with borrowed money. This is not a winning plan if you’re interested in long-term prosperity.
I don’t know of any business that could survive if it increased its’ spending to the point where it was borrowing 42 cents on every dollar it spends while watching its’ customer base shrink by 5%. And only through the force of law could a government watch it’s tax paying base shrink, increase revenues by over 50% over a 10 year period and still have the need to borrow another 42% to finance all of its’ operations while letting (encouraging?) half of its’ tax base pay no income tax. It’s absurd.
You would have to be brain-damaged to think this scenario is sustainable. We need to shrink spending, broaden the tax base to include those who don’t pay income tax and grow those who work to increase the number of tax payers in the United States. Answers to this thorny problem abound and I don’t believe that either party has a corner on the full answer. However, the answer will involve our country making significant changes that are both politically and culturally unpopular. My fear is that we do not have have the fortitude or maturity to make these difficult choices. Perhaps we care more about American Idol and getting another beer than we do about grave danger we are in as a country. I hope not, but from what I can see, my hopes are likely misplaced.