From: golchowy@alchemy.chem.utoronto.ca (Gerald Olchowy)
Subject: Re: Negative Income Tax (Was: Social programs)
Organization: University of Toronto Chemistry Department
Date: Mon, 28 Dec 1992 17:36:57 GMT

In article <1992Dec28.064913.8975@athena.mit.edu> cmk@athena.mit.edu (Charles M Kozierok) writes:
>>
>>There is no incentive as it is...the existing social programs are
>>much more lucrative than a negative income tax...and we institutionalize
>>a bigger problem by the creation of huge social program bureaucracies...
>>no-fault "welfare" is cheaper...and the money saved on less bureaucracy
>>can be directly at putting in place an education and training
>>infrastructure to provide opportunity for people to rise, and not
>>excuse for people to stay on the dole, which is what the current
>>system does.
>
>then why not work on getting rid of the social programs, instead
>of replacing them with ones which are only marginally better?
>we need serious, major changes.
>

Human capital is the most important resource in a society...a society
is not going to be successful without a social safety net...but the
social safety net should not be designed to create a poverty trap
and an underclass and a huge social service bureaucracy dedicated to
insuring that it grows.  A negative income tax or a guarenteed annual
income set at an appropriate level is the best and most efficient and
effective social safety net.  The focus of any other government programs
are programs for advancement and opportunity and for those who are
working and who want to work and who are the working poor.  The
problem with the current system is we focus our attention and services
on those who don't want to work, instead of on the working poor.

Social programs to improve human capital are essential investments
for a society to make, but they have to be made in the proper way...
and the current welfare system is not the proper way.

Social programs are not charity or altruism...but programs in the
average citizen's self-interest when one looks at the big picture.

>>Social welfare is already legitimized, and in a much more disgusting,
>>expensive, and inefficient way, and that has created a poverty trap
>>and huge government bureaucracies dediciated to the survival of the
>>underclass.  The existing social safety net is not a trampoline...
>>it is like a fly trap...anyone who falls in is trapped.
>
>then let's get rid of it. don't get me wrong -- i understand your
>point about the negative income tax being better than the current
>system. but if both systems are bad, why not work toward something
>else?
>

An effective social safety net in the society in which I live is in
my self-interest...it is not charity or altruism.  Shortsightedness
tends to be a "disease" afflicting Objectivists and libertarians.

>>
>>The general public is under that impression because of propaganda
>>from the left and from the rich.
>
>i can understand that from the left, but why the rich? if i make
>$250,000 a year, what do i have to gain by higher tax brackets
>that kick in at $75,000? loopholes? they'd have to be pretty big
>to justify the differences in the tax brackets.
>

Where do you think Clinton got his campaign financing from...from
all the rich people who want back the loopholes they lost in the
1986 tax act...

>
>are they really so large that the net effect is less than a flat tax?
>

Yes...

>>and creates unproductive and wasteful jobs for
>>bureaucrats, lawyers, and accountants.
>
>very likely true.
>
>>The way to get the rich
>>to pay taxes is to have flat taxes.  The majority loses from
>>a progressive tax system...not gains.  
>
>i don't know about this.
>tell me more about why you think so.
>

The rich paid more taxes after the 1986 Tax Reform Act in the US than
before...even though the top marginal rate was lowered to around 30%.

On almost every show which I've seen Donald Trump on...he bitches about
the 1986 Tax Reform which flattened rates and eliminated many loopholes.

I'm sure he contributed heavily to Clinton...whose has promised to
re-riddle the tax code with loopholes.   And he's going to sock it
to the middle class by taxing their health insurance as income.

Gerald
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