Saturday, April 03, 2010

Liberalism - hurting the one's you love

I have said repeatedly that I'm not a conservative for myself. The Gekko's will always have a way to be in the top percentiles of wealth/income in this country. We both have educations and connections to always make money.

I'm a conservative for the little guy. The guy who cannot outsource the additional burdens (expenses) in life.

Now it's fashionable for liberals to claim that the rich don't pay enough (although none will tell me what's fair for a guy making $250,000). But I would offer that the rich never have paid taxes and never will.

Why? Because they have resources to pass the costs onto to others that can't.

Let's use my business as an example. Let's say the feds placed a mega tax (call it health care) on computer software that costs my software providers millions in extra taxes. What do the software companies do?

1) They could reduce their cost of production. Given the additional costs across the industry more and more competitive pressure will be placed on companies to reduce costs. What better way to reduce costs than to send the programming off to an Indian company; thus costing hard working American programmers their jobs.

2) They could pass along the costs to their customers. Since all American companies will be in the same boat, no one wins a competitive advantage if, say, all the software companies do an across the board 10% increase.

3) They could eat the taxes and the owners will make less. That's hilarious. Why would you do that if you can do 1 or 2? By the way, when is the last time in recorded history someone voluntarily did more work for less money?

Let's assume they increase the costs of their software and Gordon's software costs go up $3,000 a year...... what will Gordon do?

Basically, Gordon has the same three choices above.

I can tell you that Gordon will increase his prices because he's not making less money to do the same thing and since he's not going to let his workers work harder for less he's not going to reduce their wages.

Now, let's assume that as a result of my costs increases, I increase my fees by $10 a tax return.

Does that $10.00 mean more to a single mom making $20,000 a year or a guy making $400,000 a year?

In addition, maybe the guy making $400,000 decides that my fee increase is too high and decides to do his return on the latest Tim Geithner's edition of Turbo Tax because he's smart enough to do it and he's a got a nice PC to do the work on; something the woman making $20,000 a year doesn't have at her disposal.

If you don't think this happens in real life; think again. I actually went through this exercise with an elderly client and showed her the costs incurred on a special form I had to download for her.

I am still mystified by the number of people foolish enough to believe in the "science" of global warming but somehow still dumbfounded by this concept.

Maybe I can't light a bulb out there.

2 comments:

Anonymous said...

I've never understood it either. I think the difference is not so much a difference in logic but a difference in premises. Leftists see the economy as a fixed pie that should be divided up equally. Conservitives see the economy as a pie factory.

Leftst policy spends enormous resources administering the pie and in the end the administrators get the biggest piece.

True conservatives promote the manufacture of pies. Those who make the most pie get the most pie. Those who make the least get less pie.

In either system some get more pie than others. This is known as the economic scale. Both systems have them. But here is the key: on every corresponding rung of the comparative scales, the leftist system offers less pie per citizen. Even on the lowest rung, the capitalist system results in more pie available per citizen than the lowest rung of the leftist system.

Which system is more compassionate, the leftist who promises the most and delivers the least, or the conservative who promises less but delivers more?

I'm with Gordon. How can the world's brightest minds perceive global warming but not see countless real world examples of free markets doing a better job feeding people than governments?

Anonymous said...

Well said, Gordon! Well said, Anonymous! I think if the whole ocuntry understood nothing else but the concepts in the original article and the one comment, we would be much better off.

May I add: it is not so much of a dichotomy that liberals can embrace global warming while feigning to not understand simple economics. The issue is liberals root themselves in an ideology, whereby all things, true or not, proven or not, which further that ideology are embraced. Those that do not, are discounted as "unenlightened" or "subversive".

Arguing the facts do no good, because liberals are not interested in facts. It truly is, as Glenn Beck illustrates in his book, "Arguing with Idiots".

The trick for conservatives, like us, is not to sit around moping and complaining or trying to shout louder than the 'idiots', but to take the cards that have been dealt and use sound economic principles to capitalize on the situation, so that we are the last ones standing when the liberals' dependence on government causes them to implode.

Scott S.
Phoenixville, PA
(former long-time 45069 resident)