Would You Go Into Debt Paying For Government Programs?

As a few of you might know I'm a huge proponent of allowing tax payers to directly choose which government organizations receive their individual taxes...aka pragmatarianism.

I've tackled this concept from a gazillion different angles but one aspect that I'm still kind of hazy on is whether tax payers would go into debt trying to fund the government organizations that they value.

Does that make sense? With the pragmatarian approach you would still have to pay the same minimum amount of taxes...but nobody would be stopping you from paying more than your fair share of taxes.

So given the opportunity, would you go into debt trying to make sure that your favorite government organizations had "sufficient" funding? Would you whip out your credit card to help pay for public education? Would you take out a second mortgage on your house to help pay for infrastructure? Would you sell a kidney to help ensure that our borders were secure? Well...I guess that wouldn't count as going into debt but it's still a good question.

Here are the logistics of this approach in case any of you missed it on other threads...tax payers would be able to divvy up their individual taxes among three different tiers...Congress (top), Cabinet Departments (middle) and individual GOs (bottom). Each GO would have a fundraising progress bar on their website and tax payers would be able to pay their taxes at any time throughout the year. They would pay their taxes directly to the GOs and the GOs would give them a receipt and send a receipt to the IRS.

Pinkie, so.................are you really going to make me get on my knees and beg for enlightenment? Cause if I do so, but you were planning on enlightening me anyways after you came back from the bathroom or whatever, then I'll be kind of embarrassed. I guess there are worse things to beg for though.

But if you're assuming that I'm not aware of the fact that we have a representative democracy then I'm going to be a little irked. If that's the case then I'll go ahead and assume that you're not familiar with any of the concepts that I cover in my post on power and control.

Pinkie, um. I don't think I asked you if you had ever read any of my posts before. But now that I know the answer to a question I probably didn't ask... I'm kinda curious. Why haven't you ever read any of my posts before?

In short, no. But I simply don't believe in pragmatarianism, since most people would opt to not spend on defense, infrastructure, etc. ...necessary evils that don't look pretty and smell good. However, I don't believe the gov't should go into debt except under extraordinary circumstances...to fight a war for example, and tax rates raised to pay off the debt as fast as possible. As costs increase, they must be cut and/or taxes raised...for example, it's obvious that SS and Medicare spending at current rates will rise dramatically if left as is, so benefits need to be reduced, age limits raised, and/or taxes raised to realistically pay for it all.

Xerographica said:

Pinkie, um. I don't think I asked you if you had ever read any of my posts before. But now that I know the answer to a question I probably didn't ask... I'm kinda curious. Why haven't you ever read any of my posts before?

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Until this thread, I never saw any.

Wanna discuss taxation? I always find that a fun discussion.

ChuckBerry, guess it's a good thing I asked people how they would allocate their taxes before starting this thread...

Political Forum (How Would You Allocate Your Taxes?)
Debate Politics
Ron Paul Forums (How Would You Allocate Your Taxes?)

Pinkie, I blame myself for not bringing my posts to your attention earlier.

Sure! I'd love to discuss taxation. Let's start off with a practical exercise!

Step 1. I tell you that I have your best interests at heart
Step 2. You send me a lot of money
Step 3. I spend your money on things that are good for you

Then we'll switch roles. Sound like a plan?

Xerographica said:

Pinkie, I blame myself for not bringing my posts to your attention earlier.

Sure! I'd love to discuss taxation. Let's start off with a practical exercise!

Step 1. I tell you that I have your best interests at heart
Step 2. You send me a lot of money
Step 3. I spend your money on things that are good for you

Then we'll switch roles. Sound like a plan?

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Let's see if we have any areas of agreement, shall we?

We need government of some sort....public transportation, food safety, law and order, just to name a few.

If we can agree on that, perhaps we can also agree we cannot have government unless we pay for it via taxation.

So far, so good?

Pinkie said:

Let's see if we have any areas of agreement, shall we?

We need government of some sort....public transportation, food safety, law and order, just to name a few.

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Might as well keep naming them, and we'll scratch off the ones we don't like. I'll start with food safety. We don't "need" that.

If we can agree on that, perhaps we can also agree we cannot have government unless we pay for it via taxation.

So far, so good?

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Sure. But justifying one legitimate federal government function won't justify them all. Each function requires its own justification.

Pinkie, let's say that you, me, Chuckberry and Neomalthusian agree to purchase a house together...and we all agree to split the mortgage.

The trickiness comes into play in deciding what the house needs. As a "very liberal" you believe the house needs a pool, a jacuzzi, a pool guy, a home gym, a vegetable garden, a greenhouse, a gardener, a state of the art washer/drier/fridge/dishwasher, a maid/cook, post-modern furniture, modern art, an interior designer, a feng shui consultant, a ridiculous home entertainment system, earthquake insurance, flood insurance, tornado insurance...etc.

Chuckberry, the conservative, believes that the house needs two dobermans, a security guard, a steal-reinforced 10ft brick wall topped with razor wire...and new copper pipes.

Neo, the libertarian, believes that the house needs very little. He just wants a home security system and super high-speed internet.

As the centrist, I believe that the house needs a reasonable amount of common goods.

In order to pay for all your common goods we'd each have to pay a lot of money. On the other hand, we wouldn't have to pay much money to cover Neo's common goods. So we all agree to each pay the average amount between your high cost and Neo's low cost.

We decide to allocate our "common money" via the representative method. So we take a vote and everybody votes for themselves...except for me. I vote for you...so you win. You immediately increase our common money rate in order to try and pay for all the common goods. But you decide it's not enough money so you take a second mortgage on the house.

Us guys start to grumble and even you kind of realize that we can't afford all the common goods you want. So we take another vote and elect Chuck. Chuck lowers our common money rate but doesn't pay off the second mortgage. Then he directs nearly all of our money to building his super wall, hiring a second guard and buying a third doberman.

You point out all the weeds in the garden, the alligator in the pool, the dishes in the sink...and you promise not to raise our common money if I vote for you again. Neo objects of course...he wants me to vote for him. Heh, like anybody would ever vote for a libertarian. Obviously our house needs more than two common goods.

So I vote for you but you do exactly the same thing as the first time. So then I vote for Chuck but he does exactly the same thing as well. The bank is breathing down our necks and the animosity in the house is palpable. There's got to be a better way.

I call a house meeting and suggest a new method. Everything would be exactly the same...except, if we're not happy with our representative we can choose for ourselves which common goods receive our individual common money. We decide to give it a try.

Neo pulls me aside and tells me that we've been seriously overpaying for pretty much all of our common goods. He takes me to ikea to see some reasonably priced furniture.....then to a local gym which has an olympic sized pool and low fees. Afterwards we go to a local mom and pop restaurant with healthy but very affordable dishes. Lastly he takes me to a very nice local botanical garden where he tells me about how we can significantly reduce our insurance rates by bundling.

What do I do? I present you with all these alternatives. Perhaps you'll agree with some and disagree with others. Maybe you'll provide some different alternatives.

What ends up happening is that we start focusing on results. If you can find us a super skilled/affordable chef to come cook for us then none of us guys are going to bother going out and paying more money for mediocre food. If you can find us a crazy motivated/knowledgeable personal trainer that can give us a great group rate then we wouldn't bother paying for a gym that we never go to. If you can find a gardener that turns our garden into the Garden of Eden for less money than the cost of membership at our local botanical garden then we wouldn't complain.

We all want the best results for the least amount of money. We all want the most bang for our buck. It's within our reach. We just have to concentrate. Pragmatarianism...it's completely non-partisan...and within our reach. We just have to concentrate.

This is all based on the idea "we cant afford". Yes we can, but some are willing to pay what is needed. And that is the real discussion.

A world the OP is thinking of does not work.. we have already had that kind of egotistical world... it is called the dark ages and frankly anything before the late 1800s.

But just think of the kind of society we are talking about. I for one would not want to pay for military spending, or politicians not elected in my district or fat cat bankers. Nor would I want to pay for anyone outside my own little geographical area and certainly not pay for the roads or infrastructure I dont use. To be brutally honest, EVERYTHING would become more expensive especially if you dont live in a major population centre. Small towns would not to be able to afford things like electricity because the cost of establishment and maintenance of a grid would make the electricity so expensive for the town. Add to that roads that are not made of dirt and so on.

So.. the OP idea.. is idiotic, selfish and egotistical and will not work in the modern literate free societies we have today.

PeteEU, you answered the trick question that I asked in my thread on Other People's Money.

Let me copy and paste it for you...

Can you offer an example of a public good that people would forget to fund? (hint, it's a trick question...by offering an example you automatically disprove your example)

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PeteEU said:

This is all based on the idea "we cant afford". Yes we can, but some are willing to pay what is needed. And that is the real discussion.

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No, that is your made up claim.

Let's assume you meant "some areN'T willing to pay what is needed." Well I wonder who you think isn't willing to pay what is needed. Let's just take those making $250,000 a year or more. Leave the lower earners alone, they need all the help they can get, right? $250k+ is about 2% of US households, and with there being about 112 million households, that means about 2.24 million households make $250k+. What would each of those households need to be "willing" to hand over to the federal government to cover just this year's federal deficit?

About $714,000. Per household. This year alone.

So, what have we learned today? "We can't afford."

Neomalthusian said:

No, that is your made up claim.

Let's assume you meant "some areN'T willing to pay what is needed." Well I wonder who you think isn't willing to pay what is needed. Let's just take those making $250,000 a year or more. Leave the lower earners alone, they need all the help they can get, right? $250k+ is about 2% of US households, and with there being about 112 million households, that means about 2.24 million households make $250k+. What would each of those households need to be "willing" to hand over to the federal government to cover just this year's federal deficit?

About $714,000. Per household. This year alone.

So, what have we learned today? "We can't afford."

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Those households could be millionaires and billionaires, so while the figure seems like a lot, it could be just a little bit when averaged over all of the group. The real question is what would the top tax bracket or the top two tax brackets have to be to balance the budget?

I guess simply put, you can say that we need a balanced budget, and even run a surplus in good times to cover the bad economic times. But we also need many programs that are working. The trick is to cut from programs that don't work so well or are over-funded while not cutting the important programs. Overall, we need a balanced approach that includes real spending cuts and also tax increases as well.

Opteron and Pinkie, pragmatarianism is the perfect solution but for whatever reasons neither of you can see it.

Question: Why does the private sector operate more efficiently than the public sector?
Answer: Survival of the fittest

Question: Who determines which are the fittest organizations in the private sector?
Answer: Consumers

Because consumers have a CHOICE, private organizations are forced to compete for money. Consumers in the private sector do not give their money to unfit organizations.

So what happens if we allow tax payers to choose which government organizations receive their individual taxes? Would you give your hard earned money to a government organization that is just going to waste it? Of course not! Nobody would. Given the CHOICE, tax payers would not allocate their taxes to unfit government organizations.

Competition is the ONLY way to guarantee maximum fitness.

Pinkie, ack. Hmmm. Your Dept of Defense example would only be valid IF you had directly allocated a portion of your individual taxes to the Dept of Defense. And I'm pretty sure you didn't do that. So...your evidence actually supports my argument.

Is this thread about privatization? Sure. Yes! Is it also about nationalization? Yes! Definitely.

Do you want to privatize anything? The Dept of Defense? Be my guest. Do you want to nationalize anything? Healthcare? Of course! Why not?

See...I'm not a liberal...I'm not a centrist...I'm not a conservative...and I'm not a libertarian. I'm a new breed. I'm a pragmatarian. Your ready made arguments are useless against me. All I care about is results. How in the world can you argue against results? If you want to start a private organization that effectively fights terrorism and halts genocide in its tracks then I'll donate more of my private money to your organization and less of my public money to the DOD. If your national healthcare offers better coverage at less cost then I'll stop purchasing private healthcare and allocate more of my public money to the department of health.

As I tried so so so so hard to explain in my example of us living together...I'm on your side as long as "your" programs offer better results than "their" programs. Of course, once we allow tax payers to directly choose which government organizations receive their individual taxes...then there will be no more such thing as "your" programs or "their" programs. There will only be "effective" programs and "ineffective" programs. Needless to say, "ineffective" programs won't last very long in a pragmatarian system.

Opteron said:

Those households could be millionaires and billionaires, so while the figure seems like a lot, it could be just a little bit when averaged over all of the group.

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By definition some of them are millionaires and billionaires, but there are only about 400 billionaires.

There are lots of millionaire households, by net worth. Most of these "millionaires" probably have between $1 and 3 million and are gearing up to retire. For example, a family's $300,000 house and $1.2 million retirement funds make them "millionaires," but that's what they need to retire. That's what they saved diligently to accumulate, on salaries that are not that large. How are people like these going to fork over half a career's worth of savings ($700,000) to cover "their fair share" of this single year's federal spending irresponsibility?

I guess simply put, you can say that we need a balanced budget, and even run a surplus in good times to cover the bad economic times. But we also need many programs that are working.

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Nothing "works" that cannot be afforded.

The trick is to cut from programs that don't work so well or are over-funded while not cutting the important programs.

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No, the trick is to not default or enter hyperinflation. The programs will all fail eventually if we can't keep control of the budget.

Overall, we need a balanced approach that includes real spending cuts and also tax increases as well.

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Thank you, Mr. Obama. That has a nice political ring to it and makes me feel all warm and fuzzy.

Unfortunately, tax increases and very careful spending cuts will not even make a dent.

Neomalthusian said:

By definition some of them are millionaires and billionaires, but there are only about 400 billionaires.

There are lots of millionaire households, by net worth. Most of these "millionaires" probably have between $1 and 3 million and are gearing up to retire. For example, a family's $300,000 house and $1.2 million retirement funds make them "millionaires," but that's what they need to retire. That's what they saved diligently to accumulate, on salaries that are not that large. How are people like these going to fork over half a career's worth of savings ($700,000) to cover "their fair share" of this single year's federal spending irresponsibility?

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You're confusing worth, and what you're making. You're talking about people that have more than $250,000 per year not people that make more than $250,000. You don't pay taxes on what you own, you only pay taxes on income for income tax. So the families that you're talking about, that are gearing up to retire, would not be making more than $250,000 in one year, and would not be included in the group that pays $700,000. People that are making more than $250,000, paying $700,000 averaged over millionaires and billionaires may not be that much.

Again, the real question is what will the highest bracket have to be to balance the budget?

Neomalthusian said:

Unfortunately, tax increases and very careful spending cuts will not even make a dent.

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If you think tax increases are off the table like the Republicans do, then you are not being serious about solving the deficit. We need something like 50/50 spending cuts to tax increases to solve the deficit problem, maybe 60/40, but something around 50/50 spending cuts to tax increases.

Opteron said:

You're confusing worth, and what you're making.

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I most certainly am not. You said "these people might be millionaires and billionaires." When you talk about these people, you're talking net worth.

So the families that you're talking about, that are gearing up to retire, would not be making more than $250,000 in one year, and would not be included in the group that pays $700,000.

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Again, 2% of households (2.24 million of them) make $250k+ per year. $1.6 Trillion / 2.24 million = $714,000.

And remember, this is what would hypothetically be necessary to cover this year's deficit. Meaning this would be needed in addition to what they are already taxed.

People that are making more than $250,000, paying $700,000 averaged over millionaires and billionaires may not be that much.

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Read that again a few more times. You don't understand what you're saying. You are the one who is clearly confusing wealth and income.

Again, the real question is what will the highest bracket have to be to balance the budget?

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Well over 100%.

If you think tax increases are off the table like the Republicans do, then you are not being serious about solving the deficit.

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It's not that they're off the table, it's that they do soooo little to address our runaway debt that it's sickening.

We need something like 50/50 spending cuts to tax increases to solve the deficit problem, maybe 60/40, but something around 50/50 spending cuts to tax increases.

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You're making this up as you go, to sound "fair," but the math doesn't add up. This won't even come close.

Neomalthusian said:

I most certainly am not. You said "these people might be millionaires and billionaires." When you talk about these people, you're talking net worth.

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I said, those guys could be millionaires and billionaires, I didn't say every single millionaire fits in this group. And then you give a long explanation on someone who doesn't fit in that group. You are clearly confusing people who have money versus people who make more than $250,000. I never confused them and I never said anything that you assumed.

Neomalthusian said:

Read that again a few more times. You don't understand what you're saying. You are the one who is clearly confusing wealth and income.

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No, I'm not confusing anything, you are not understanding everything said. There are people who make millions in one year and there are people who make billions in one year. Say someone made $50 million in one year, is $700,000 that much? No its not. Remember, the minimum someone makes in that group is $250,000. So averaged against people who make $25 million, $50 million, $30 million, $10 million, $700,000 may not be that much.

Neomalthusian said:

Well over 100%.

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No, I figured it out, it's around 100%. The Tax Foundation - Summary of Latest Federal Individual Income Tax Data

Neomalthusian said:

It's not that they're off the table, it's that they do soooo little to address our runaway debt that it's sickening.

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No, they do make an impact, depends on how much they are.

Neomalthusian said:

You're making this up as you go, to sound "fair," but the math doesn't add up. This won't even come close.

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You're not understanding that part because that math does add up, its applied to the whole deficit. So that half the deficit is made up in spending cuts, and the other half is made up in taxes, so the budget is then balanced and its made up in 50/50 proportion of cuts to taxes. Around 60/40 would be better so that out of a deficit of $1.6 trillion you could do something like $900 billion in cuts and raise taxes by $700 billion to eliminate the deficit.