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Wednesday, September 16, 2009

South Dakota as Retiree Tax Haven? KELO Tells Half the Story

KELO declares South Dakota a tax haven for retirees. No state income tax, no inheritance tax, low cost of living... who needs Arizona?

But Angela Kennecke fails to tell us the full story. In the very same Kiplinger article that KELO cites and links, senior editor Mary Beth Franklin offers this caveat:

...But many of the remaining 41 states (and the District of Columbia) that impose an income tax offer generous incentives for retirees. If you qualify, moving to one of these retiree-friendly areas could be cheaper than relocating to a state with no income tax.

Plus, in tough economic times, states without a personal income tax have fewer sources of revenue and are more likely to raise property or sales taxes and other fees to shore up their budgets. State tax revenues plunged nearly 12% during the first three months of 2009, the sharpest decline on record, reports the Nelson A. Rockefeller Institute of Government. And it may take states years to make up the shortfall [Mary Beth Franklin, "Tax-Friendly Places to Retire," Kiplinger Personal Finance via Kiplinger.com, October 2009].

Declining state revenues, increasing property taxes and fees... sound like any prairie state you know? Funny that the local media missed that portion of the analysis.

I'm still suspicious of a strategy for recruiting residents and businesses that relies on attracting folks who don't want to pay taxes. Over time, it seems that strategy brings you a population of loners and corporate raiders who are more interested in their personal comfort and wealth and less interested in paying their fair share for even basic public investments like roads and schools.

So your questions for the watercooler today: Does selling one's state as a refuge from taxes promote a culture of narrow selfishness? Does South Dakota's "No Taxes!" tagline drive away more community-minded residents? Discuss....

39 comments:

  1. " Over time, it seems that strategy brings you a population of loners and corporate raiders who are more interested in their personal comfort and wealth and less interested in paying their fair share for even basic public investments like roads and schools ..."

    Yaaaa. That's South Dakota all right, a bunch of old Scrooges living in isolated mansions and swapping multinational conglomerates via satellite Internet.

    Seems? Or is certain? It seems to me that I'm the only loner I know; I'm certain that I'm the only local corporate raider who has ever ripped himself off (and I'm getting more corporate and more raiderific with each passing night).

    There are plenty of community-minded residents here in Lead. Rare indeed is the bird who would turn away a person truly in need; doggone few want higher taxes. And it seems to me that the same holds true statewide, although I am not certain of it.

    If we ever do get a state income tax and then see property taxes go down, well, by golly, I'll eat my Aussie hat, sauteed with grasshoppers in beezlenut oil.

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  2. "Does selling one's state as a refuge from taxes promote a culture of narrow selfishness?"

    No. Taxes and selfishness do not go hand-in-hand. Generous people can prefer lower taxes. (And stats show that they do... People who reject the idea that "government has a responsibility to reduce income inequality" give an average of four times more than people who accept that proposition.)


    The culture of "let the government solve it" is the one I'm afraid of, because, historically, that's the one that brings about World Wars and the collapse of civilizations. Misanthropes, at their worst, might act alone and bomb a government building. They don't invade Poland. It takes a respectable amount of team-building to pull off a stunt like the Holocaust.

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  3. Is there a difference, David, between "Let government solve it" and "Let's solve it through government"?

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  4. Good question, Cory.

    Semantically, yes there is a difference... it certainly is more rhetorically pleasing to hear that we're going to solve something through government.

    But practically speaking, is there any difference? The politician is solving something through government (e.g. enacting no child left behind), while the disinterested citizen is letting the government solve it (i.e. laying down the problem at their feet and assuming they will fix it). So it seems to me, the only difference is one of perspective... the degree to which a person is active in the process.


    Counter-questions: At what point does the government go too far in their efforts to solve something? That's the classic philosophical question, ruminated upon since the days of The Republic. 100 years ago our Constitution considered a federal income tax as being 'too far'.

    And how do we know the difference between (a) when something is being solved through the government and (b) a sophist is saying that to manipulating the minds of citizens into ultimately securing more power for himself? (think: Napoleon, Mussolini)


    These are not rhetorical questions, and I am sincerely interested in your thoughts on them...

    Kind regards,
    David

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  5. "manipulating" ==> "manipulate"

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  6. Practically speaking, yes, I think there can be a difference. I act as a politician (one engaged in the affairs of the polis) by serving on the Lake Herman Sanitary District board and looking for ways to use the board's resources to solve problems (unsucessfully, so far, but I'm trying). The citizens who attend our meetings and call me with ideas are also acting as politicians, looking for solutions that our small government can enact. I agree that if everyone is just sitting around waiting for government to wave its magic wand, that's bad. But if we are all actively engaged as politicans (to the extent regular citizens can dedicate their time to political affairs in addition to work and family and fending off barbarian hordes), that's good... isn't it?

    At what point does gov't go too far in trying to solve a problem? Speaking all too generally, I'll suggest gov't should not get involved if its solution makes the problem worse or creates other outweighing problems. I'll even crack out my Adam Smith and see the government shouldn't solve the problem if the private sector can provide an equal or better solution. Speaking concretely, consider the sanitary district. I oppose government taking action to build a central sewer system because I believe individuals are solving the problem (wastewater treatment) just as well, for less money, with on-site septic systems for which they are personally responsible.

    But I wonder: is there a realm where the private sector might provide, say, a 50% satisfactory solution while the public sector could provide a 60% satisfactory solution, but where I (or Smith, or you...) would still say that improvement in the solution is not worth the inherent (not instrumental) ill of government intervention? Is there some inherent ill to gov't action that has no equivalent in private action?

    Second question, that odd difference: you tell the difference by reading the Madville Times. I can always tell.

    The real answer: it's tricky... but I'm not convinced that's a unique problem. You worry over the pigs at Manor Farm starting with a noble cause but turning into the very men they overthrew. Might we not worry as much about the pigs at Google who are about to turn their servers into Colossus? Seems to me our best action is to keep each other close, pay attention, vote often, and blog oftener.

    Government can solve stuff. That's why we created it. That's why we need to keep viewing it as ours, as us.

    (By the way, some Anon said government is bad because all politicans get corrupted by lobbyists. I haven't had a lobbysit show up yet for a sanitary district meeting. Where's my gravy train? ;-) )

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  7. "But if we are all actively engaged as politicans (to the extent regular citizens can dedicate their time to political affairs in addition to work and family and fending off barbarian hordes), that's good... isn't it?"

    That's an excellent question...

    We could start with the Socratic line of reasoning and wonder if we would all get better bread and medical care if all citizens spent more time helping the baker and the doctor. Does lots of random input help make the best decisions?


    Or let's ponder...

    Is utopia the nation that has lots of political involvement (and, consequently lots of new laws), or the one that has very few new laws (and consequently little need for political involvement). Personally, I would prefer the limited government so that it's one less thing I have to concern myself with. If I had gobs of free time, I would rather play a game of chess than attend a city council meeting. I know all sorts of poly sci majors will come out and try to make me feel like a bad person for stating it that bluntly... that I am shirking my civic duty and the reason why there is so much wrong with our country. Can I reciprocally berate them for slacking on their chess?

    So no, I don't think it is good to have everyone involved in government. I think a society that needs everyone involved is one that has been corrupted by legalism. I would prefer the laws of the land to be a stable bedrock upon which I can build my domestic home and establish a life-long trade... not the shifting sands of memes and popular opinion. Why should we praise a society where you have to force yourself to keep an eye on political activity to protect your domestic tranquility from vain politicians clawing after fame and power? That's really what the civic duty 'virtue' amounts to... that you need to be aware of people legislating something you won't like. Well if the legislative process was such that it was difficult to pass new laws (e.g. require a 66% majority to pass) then the virtue becomes much easier for everyone.


    What then about those people who prefer the hobby of playing/watching/punditing government over playing chess? (And I suspect I am writing to one.) What then, I ask... What about these people who think it too boring to just go along with the laws as they are? What should we say about people who think that it is a good use of free time to busy themselves with coercing their neighbors?

    I honestly think our government is mostly a game. It's a game of decoys and deception. A game of bluffing and influence. A game of hoghousing and self-serving amendments. A game of trying to separate oneself from the crowd... even when the crowd might have a legitimate idea.

    (continued...)

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  8. Voters are points and politicians have to carefully craft their image to appeal to as many voters as possible. They have to weigh the cost-benefit of their positions, they have to weigh the "political capital" it takes to drive a certain bill through Congress against the "politcal fallout"... because you'll lose support/approval/voters if you try to push a change that's too large... or too many changes in a short amount of time. You have to trade votes with your comrades in the senate... make promises to support something you dislike to get their support on something you sponsor. And then there's the whole game of spin... how did John McCain get the Presidential nomination? Precisely because of a tactic he used against Mitt Romney in Florida the week before Super Tuesday. He ran misleading ads showing Romney using the word "timetable" (in reference to Iraq) when the quote was entirely out of context. McCain even admitted as much in the following debate... but by that time he had already won Florida and was poised to score the coup de grace on Super Tuesday. McCain learned how to apply a tactic like this in the South Carolina primary eight years earlier.

    This is why so many poly sci majors find it interesting. A bedrock of laws is as much fun as tic-tac-toe.


    "Speaking all too generally, I'll suggest gov't should not get involved if its solution makes the problem worse or creates other outweighing problems."

    "But I wonder: is there a realm where the private sector might provide, say, a 50% satisfactory solution while the public sector could provide a 60% satisfactory solution, but where I (or Smith, or you...) would still say that improvement in the solution is not worth the inherent (not instrumental) ill of government intervention?"

    And there's the rub... who objectively is qualified to judge what's 50% or 60% satisfactory? Universal health care is 100% good to a person with no income and 98% bad to a person with a lot of wealth... who could instead have a modest health insurance policy. I've voiced my suspicions that the Madville Times' assessment of "satisfactory" government programs might be tainted by its shareholders' self-interest.

    But assuming 'satisfaction' can be objectively measured... consider this example about retirement policies. Even if the private sector only offers "30% satisfaction" at least it's not compulsory. I can simply opt to do something else with my money. I'm not forced into a "50% satisfactory" social security program.


    That's why I think government intervention is at best a necessary evil. Coercion shouldn't be invoked "when it's better"... but only when it's necessary.

    Kind regards,
    David

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  9. David, I continue to wonder at the abstract level at which you dwell. But your preference for chess over politics appears to lead you into some strange contradictions.

    First you suggest that the "random input" of lots of citizens is undesirable. But then you fret over politics as a mere "game of trying to separate oneself from the crowd... even when the crowd might have a legitimate idea." Hmmm... which is it?

    Actually, input from the masses in the form of prediction markets can produce pretty good information, often just as good as the best guesses of experts. See Cass Sunstein and James Surowiecki.

    Utopia would be the society that can run swimmingly without any laws or power structures. That's why they call it utopianowhere. You don't get to play chess in the state of nature. Chess is a fine game, but that's all it's supposed to be. Politics can be abused into a mere game, but it is supposed to be much more. Chess done right is better than politics done wrong, but politics done right is much more useful and necessary than chess done right.

    "A society that needs everyone involved is one that has been corrupted by legalism." Wrong on a couple levels. Universal involvement maximizes legitimacy. And even if there is such legalistic corruption that we need everyone to pitch in and fix it, that does not mean that we should not pitch in and fix it. It sounds like you're saying that if there is such a big fire that everyone has to bring a bucket to put it out, we shouldn't bother to put it out. If corruption is so rampant, that's all the more reason for everyone to step away from the chess board for at least a moment and exert the democratic will.

    You appear not to trust anyone, either the capricious public or the venal games-playing politicians. No one is qualified to lead, so you appear to prefer no leadership. But we can't trust everyone to just build their homes and businesses and play chess all day. I'm afraid your roadmap lacks a consistent vision for practical governance.

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  10. "You appear not to trust anyone, either the capricious public or the venal games-playing politicians. No one is qualified to lead, so you appear to prefer no leadership."

    Although you stated it derisively, this is what I believe. I don't think that anyone has the right to rule over another person. Democracy is better than the alternatives because the alternatives invest rulership into one person or clique. Democracy at least states that no one deserves to rule, so we'll all share in it alike.

    But that doesn't, by itself, guarantee a society with minimal rulership. We've learned a lot from the American experiment... things started out great in terms small governmental scope with a lot of respect for personal liberty. But the federal government, like most any human institution, lays plans to guarantee its perpetual existence and expand its territory. The well-meaning 14th amendment was the crack in the dam of minimal government. The 16th amendment hurried things along.

    We learned that a majority can legislate just as prodigiously as a king, and that majorities are not above voting themselves benefits at the minorities' expense. Nary a politician (except Mr. Heidelberger running for Student Body President, ironically) wants to vote themselves limits on their influence... and as the government accrues more power, running it becomes more attractive to power-hungry people. And we have learned that these kinds of people will say anything to get elected.


    So yes, I disdain rulership of all forms. Rulership is immoral. No one deserves to rule over another human being. I'll say that on a political website as boldly as I would say it in a fundamentalist church preaching about submissive wives.

    I'll concede that a certain basic amount of rulership is necessary for social order... but anything above what is strictly necessary is, well, evil.


    And I'm fully aware that what I desire in government is light-years away from what it possible. Pandora's box is open and there's probably no way of putting it back in... That's why people like me flirt with secessionist language.

    Kind regards,
    David

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  11. Back to the tax debate ...

    If South Dakota were to adopt an income tax on top of the other taxes we now have, but property taxes were to go down by 10 percent, I would take a net pay cut. My income derives mostly from out of state. My "company" will pay me the same annual "salary" whether I live in Lead, Sioux Falls, Minneapolis, Chicago, New York, Boston, Honolulu, or San Francisco. The Higher Powers have been benevolent towards me in recent years; I'm actually earning a decent income from my scrivener's toils.

    I realize that my situation is a little off the mainstream, and I tend to be better off in places that have lower taxes as compared with places that have higher taxes, even when all other factors are not equal (and they never are).

    What about you, Cory? Suppose we adopt a state income tax of, say, 10 percent of the federal tax liability, while property taxes go down by 10 percent and all the other taxes remain the same? Will you end up paying more in total taxes, or the same, or less?

    The ideal tax is the tax that someone else pays. I'm as guilty of self-interest as the next guy in that respect, and maybe more, because I'm more conscious of it. I see every tax hit in all its ugly beauty (or beautiful ugliness), because I prepare my own returns.

    By the by, how much use tax do you pay on your out-of-state Internet purchases, Cory? Most people don't even know that they're supposed to pay this tax, and the state generally doesn't pry into people's lives on this issue. But I can't get away without paying it, because I have to file a sales and use tax return every year for the technical writing proprietorship "Stan Gibilisco, Not Inc." It's not a big deal, really. Last year my total use tax bill came to something like thirty-seven dollars.

    Sorry for the long-windedness. I'd get along well with Joe Biden over supper at Chef Louie's, I suspect -- except maybe on the issue of taxation, where we'd doubtless get into a debate that would precipitate a Maalox mandate.

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  12. Oh yeah, taxes!

    Stan, if I understand your proposal correctly, I'd see my taxes drop. I paid about $800 in federal income tax and $1700 in property tax last year. Take 10% of the former and give me 10% of the latter, I come out ahead $90. Crank that income tax rate up to 20%, and I'm about even.

    As I've said before, I would take a complete replacement of property tax by income tax, because then at least my taxes would be based on a concrete number, actual money that came into my hands last year, rather than someone's vague guess of what I could sell my house for and how pretty my neighbor's new deck and finished basement are.

    Sales/use tax: I have more companies catching on and charging that in their sales. I assume they really are writing the check to the State of South Dakota. I do make sure that the online vendors we deal with charge us 4%, not 6%, since we are in the country and don't pay city sales tax.

    Congrats on turning your writing into good income! You may be able to foot the bill when VP Biden comes to dinner (and when that happens, I want to be there -- I'm sure the conversation will be lively!).

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  13. I do describe your belief derisively, David. Some people are qualified to lead, and abandoning all leadership is not a practical prescription for a functioning society.

    I'm still seeing contradiction here. You deem democracy the best alternative, yet earlier you spoke negatively of getting lots of input from lots of citizens... which suggests that you prefer a republican (?) system in which the citizens elect leaders to make wise decisions for them so the citizens can spend their time making homes, going to work, and playing chess. Which is it?

    Remember also that the trend toward non-minimal government started not with the 14th Amendment but the 1st, and Article I, and the whole pitching of the Articles of Confederation, real minimal government that the Founders found tolerable for hardly six years. Even Jefferson saw that minimal government was not preferable.

    (Voting to limit our own power: don't forget, I just proposed a zero tax levy that would have restricted my range of action my sanitary district board enjoys. Most residents opposed the move: they want to use our local government as a vehicle for collective action, funded by tax dollars.)

    Flirting with secessionist language does more harm than good. Let me jump to some conclusions: America did things right for a while, maybe 70 years. We'd have been better off to let the South secede and establish its own constitution. Are we to go further and propose that we need to dissolve or overthrow every goverment after a few decades, just to keep the power structures shifting?

    Maybe you would enjoy some Jeffersonian watering of the tree of liberty every few decades, but down that road lie Africa and the former Soviet Union, where you would be less free to play chess than you are here in darned big-government America. To hearken back to your earlier question, how can I tell the difference between secession that actually solves something and a sophist who is simply issuing the call for secession or revolution to make it easier to win power for himself (think Lenin, Pawlenty)?

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  14. Hi Cory,

    If you haven't heard, I'm moving to Salt Lake City next Tuesday (found out about it last Tuesday), so unfortunately I can't give this discussion my full attention.

    I notice that you consistently use the terms leader/leadership where I use ruler/rulership. Are we talking about the same thing or talking past each other?

    I see a guy like Martin Luther (or Martin Luther King) as a leader... persuaded people of his ideals. A guy like Mussolini, Caesar, or Lincoln is a ruler... one who forces their country into war for their ideals. You keep referring to politicians as leaders, not rulers. Are you just trying to avoid the stigma of that term?

    Kind regards,
    David

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  15. PS Just to be clear, I'm not trying to get out of the conversation. But might have to postpone full-fledged replies for a couple weeks while I take charge of business out West.

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  16. Aha, Cory, the income tax would favor you, while the status quo favors me! No wonder we see things differently!

    That said, your proposal (replace the sales and property taxes by an income tax) in its pure form seems more fair in general to me than is the current state of affairs, even though it would cost me a bit more unless the goddesses suddenly develop bitterness toward me.

    A note, however: If I keep grabbing up real property in an attempt to "solidify" my portfolio (figuratively and literally) against the possibility of looming ruinous inflation, your plan may soon cost me less than all that property tax, which, as we all know, is pretty steep in this state.

    Another point for an income tax is that it's levied in accordance with one's ability to pay, whereas property taxes are absolute. If you hit the skids, your income tax will drop to little or nothing, but your property tax (and sales tax on necessities) will remain the same.

    Ironically, the Democratic candidate for governor in the last election, Jack Billion, made a point that he wanted to attract small business people who make a living "by remote control" (not his exact words) using advanced technologies such as the Internet. I am precisely the sort of person he talked about. One of the main reasons I came here was the lack of a state income tax, because, again, that scheme favors my particular situation. I suspect, however, that down deep in his heart of hearts, Jack Billion would have liked to see a corporate income tax (at least) and perhaps also a personal income tax in South Dakota.

    I suppose I could invite Jack Billion to dinner along with Joe Biden (and Barack Obama, the person I would most like to have a barbecue with!), ask him that question, and pick up the tab if both of those guys would swear on a stack of copies of the Constitution to tell the truth, the whole truth, and nothing but the truth.

    My next-door neighbor, a staunch Republican, says he would not be averse to a corporate income tax in the state of South Dakota. He's retired, so of course it would not hit him.

    As an aside, if I am not mistaken, Hawaii, one of the most heavily-taxed states, does not tax pension or Social Security income of retired persons. The property taxes are also quite low there, as are the utilities (no heat, no a/c!).

    So let the discussion go on ... but lots of luck getting the people of this state to accept an income tax in any form! I suspect that the more we discuss it, the more solid the opposition will become, because people will know that it's being talked about, and will be afraid, very afraid ...

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  17. RE: Is there a difference, David, between "Let government solve it" and "Let's solve it through government"?

    Neither are particularly valid positions, as the first is merely an abdication of taking any action at all while making the false assumption that somebody else will. It also perpetuates the belief that the government is even capable of solving it. The 2nd, by itself, is reaching for the power of the state to take action without regard to whether the government has the authority to intervene in the problem. The 2nd may be justified with certain problems, but may be foolhardy and/or unconstitutional with others.

    As Americans, it is our responsibility to be involved in finding the solutions to problems, even if they do not directly effect us. The correct phrase might be "Let's solve it with integrity" rather than turning to the government as if it is synonymous with society. It isn't.
    Government is the power to rule or control society, if government is where all solutions lie then the solution of all problems ends in tyranny.

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  18. David: rulership/leadership... I thought I felt a verbal distinction coming. I recognize the difference... but I don't think you can get around rulership as a practical matter. We need people to demonstrate leadership; quite likely we will elect those people as rulers, the folks who enforce (and as a practical matter in representative democracy, make) the rules.

    Stan: You got me! ;-)

    Actually, hand me the magic wand, and I'll impose an income tax formula that replaces my property and sales tax contribution dollar for dollar. We can't do that for everyone, and my balance will shift the moment my income does... but that's exactly the point. Ability to pay, actual wealth generated each year, is a more moral and sensible basis for taxation than wealth accumulated over a lifetime or food and clothing purchased to meet basic needs. Why should a guy who hits the skids have to apply for a sales tax rebate, as currently practiced in South Dakota? An income tax is simpler in that the guy who hits the skids automatically pays less in taxes.

    I'm not worried about talking about income tax or any other seemignly radical idea. Rather than solidifying opposition and getting people scared, I think bringing the idea up gets people talking... and will get some to realize that their opposition is based on prejudice rather than analysis.

    By the way, Stan, you may have an idea: get Billion, Biden, and every other political leading light you can get together for a barbecue at your place. You could start South Dakota's very own Aspen Institute! Send the invites, get your Republican neighbor to put guests up in the backyard, and I'll move the SD Blogosphere picnic out there!

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  19. "I don't think you can get around rulership as a practical matter. We need people to demonstrate leadership; quite likely we will elect those people as rulers, the folks who enforce (and as a practical matter in representative democracy, make) the rules."

    Hi Cory,

    I don't think we can get away from rulership as a practical matter, either. I've always stated that there are certain items that have to be taken care of by the government... law enforcement being one of them. (It's the system of creating/modifying laws that I think has gone awry... whatever laws we do have should be universally enforced.)

    I'm all for leadership, when it can be done through persuasion rather than coercion. I think the key difference in our positions is that I think rulership should only be invoked when necessary... whereas you seem willing to use rulership as a tool much more liberally... as in wherever you feel it can make society (apparently) more efficient. (e.g. Get the trains to run on time.)

    So let's discuss this difference.


    Here's my case:

    I. All human being are untrustworthy sinners... and those who are eager to rule are ahead of the curve in that respect. No one should have the right to rule over their peer... to coerce a colleague to do something against his/her will.

    II. However, society does have certain basic needs which require a government to universally and impartially rule over. For example, a society needs laws against violence and fraud among its citizens, and a city cannot have privately-funded judges or police officers.

    III. Thus, a certain amount of ruling power must be invested in some citizens to determine laws (e.g. define 'violence', 'fraud') and impartially/universally enforce those laws.

    IV. In light of principle I., these citizens should be elected democratically. Rulership by force, money, or genetics is not as fair as popular elections.

    V. Also from principle I., our constitution should limit our politicians as much as possible from using their ruling authority. Every use of such authority outside of what is strictly necessary is a violation of the rule that our politician does not deserve to rule over a peer.

    VI. Similarly, a citizen is less deserving to rule over 1,000 people than over 10 people. This means that our constitution should encourage legislation to be enacted as local as possible. The wider the area that a politician is in charge of, the more difficult it should be for him to make/change policy because his influence affects more people and he is more removed and less accessible than the local politicians.


    My proposal for putting these principles in place is to re-define what constitutes a majority vote. On national issues, it should take 95.45% approval to pass a law. For state issues, 86.64%. City/county: 68.27%.

    Cross-ex...

    Kind regards,
    David


    PS I also think property tax is grossly unfair, for the reasons you cited. Income tax is a bit better, but my gripe against that is fourfold: (a) it taxes people who want to save money, (b) it requires that you keep receipts to tell the government how you spend your money (itemized deductions), (c) the complexity of income tax rules require us to have thousands of tax accountants and tax lawyers... smart folk that could benefit society in much more productive ways and (d) because of payroll withholding, the vast majority of taxpayers don't really know how much they are paying in taxes.

    Sales tax doesn't have any of these drawbacks. (We'll exempt necessities so as not to disenfranchise the poor.)

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  20. Wow, just leaving me in cross-ex? Where's that champion debater and honorific debate coach?

    Kind regards,
    David

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  21. Easy, David -- I won't be baited. We're not in high school... and hey, I thought you were busy moving!

    Nice try making me sound like Hitler (punctual trains and all). Almost... sophist in its ignorance of who I really am and everything I've stood for.

    Cross-ex? Let's skip the foreplay:

    I. Agreed, we are imperfect creatures, prone to error. Not agreed that those seeking to rule are more prone to error. No proof, no quantification. And not agreed that we are inherently "untrustworthy." Your characterization flies in the face of vows we make to each other. No one is perfectly trustworthy, but many are trustworthy enough that we will pledge fidelity, friendship, cooperation, etc., even knowing that occasionally, we will falter.

    II, III. Agreed.

    IV. Omit Prin.I., and I agree with the main clause.

    V. Shaky. I could easily turn Prin.I. around and argue that no man deserves his freedom. If we are untrustworthy sinners, why do we deserve free rein to sin? Why not impose a king ordained by God? Why not restrict individual action to only vitally necessary actions?

    VI. I might agree that any randomly chosen individual is less suited to rule over 1000 than over 10. However, your constitutional principle does not follow. There will be fewer senators and presidents than mayors. The qualifications for Senate and White House should be higher. But the citizen who can prove himself/herself fit for those highest positions may be as justified in setting policy for the millions as the mere mayor is in setting policy for the hundreds.

    You want to make it more difficult for the national ruler to act than the local ruler. Yet your scheme also makes it easier for established powers in the status quo to continue to inflict harm on a national scale and resist the efforts of the few rulers empowered to challenge them on a national scale. Your harms via stagnancy equal my harms via change... and you impose a more convoluted and unresponsive system.

    Your percentages are a recipe for perpetual gridlock. Feel free to make a case for consensus government... but that sounds more utopian than practical majority rule with protection of fundamental minority rights.

    tax p.s.: (a) Exempt necessities, and you win this point on sales tax as advantageous. (b) I rarely itemize: standard deduction is sufficient. (c) I agree complexity and lawyers are problematic. I welcome simplification ("How much did you make? Subtract the poverty line. Multiply by 15%. Send.") (d) No advantage for sales tax -- who adds up all their sales tax at the end of the year? Penny here, penny there... sales tax is sneakier!

    We're both looking to key tax to wealth: the difference is I tax when we get the wealth, you tax when we use the wealth. Income tax beats outgo tax: a year when I have lots of expenses (not always by choice) may not be the best time to charge me more taxes. It's easier, I think, to absorb a higher tax burden that coincides with higher income.

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  22. David:

    I: People are not inherently evil. Like Cory I would completely reject this. I would rather state humanity is inherently foolish, even stupid. We will believe things for little more reason than we desire them to be true or because we fear they may be. Elected leaders are meant to exemplify the greatest character in society, men like the founders who sacrificed their fortunes and freedom when they declared independence and desired political position rendered weak in worldly attraction so as to attract people of nobility devoted to people's freedom.

    II,III. Society does have need of governance. This governance must always be checked and balanced to oppose the growth of that government which will always seek power. All history, including our own shows this is true.

    IV. Democratic rule alone is not enough, unless the people electing those leaders are virtuous themselves. If the people vote only according to how they may personally benefit, then the government they create will be no better. It's why education is so critical to good governance.

    V. If principle IV is working, and we have honorable leaders. We wouldn't want or need to hamstring our politicians. All the necessary restraint would already be there in the limitations that were there when that government's authority was defined.

    VI The more local power is kept, the more answerable it is to the people, and the more vital society is able to be. When power is concentrated at the top, the marketplace of ideas is crushed. It creates a monopoly where innovation in no longer functions. This has nothing to do with how much our leaders deserve power over 10,000 or 10. It is the same principle that makes the local business owner more desirable than a big box store: The owner is there and has the ability to listen to and make decisions based on the people he works for, and not stockholders and district managers and a corporate bureaucracy.

    VII The more defined the authority of government is, the less likely it is for government to invade our freedoms with the pretense of "the common good" or "the social contract"

    Your conclusion makes no sense, philosophically or practically. It would result in complete gridlock with nothing ever passing and is based on a continued complete mistrust in government. We need to fix the root of the mistrust to have a good government, not keep a bad one and just render it impotent.

    Cory:
    "easier for established powers in the status quo to continue to inflict harm on a national scale"
    This assumes that it is the job of a national government to address everything that has a national impact. If broader authority was given to the state instead we would have 50 separate strategies addressing the problem instead of one. Is there some reason we all need to fix the problem the same way? It is not the job of the government to 'fix it' cause it's broken unless we have given them that authority, no matter what harm may be occurring.

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  23. tax: Property tax has a lot of disadvantages that Cory has mentioned. I wonder if we might get around this and keep the advantage of having a revenue source that is stable no matter what the economy is doing at the time. What do you think of a tiered (possibly capped) property tax based only on square footage instead of assessed value. The city would devise the needed revenue and then divide it according to the total number of developed square footage in the region tiered into footage in High/Standard/Substandard property.

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  24. Ah… new apartment finally secured. And thanks to our careless (socialist?) neighbors I can get some free bandwidth to continue the discussion. And look! Two opponents! Bring it on.



    Cory: "Not agreed that those seeking to rule are more prone to error. No proof, no quantification."


    Likewise, I didn’t provide any evidence that the grass is green. Usually the onus is on the person disputing conventional wisdom to provide proof. If you really think that power makes one virtuous (and absolute power, absolutely virtuous) let’s see some examples. I can list a thousand ruthless tyrants with half my brain tied behind my back.

    Stalin, Lenin, Mao, Hitler, Mussolini, Caesar, half the popes, Henry VIII, LBJ, Che Guevara, Castro, Pol Pot, Shaka, Nero, Caligula, Sulla, Alexander, King Herod, King David, Muhammad, all the Pharoahs, Saddam Hussein, Kohmeini, Chavez…

    Truly good and righteous rulers? Three. Marcus Aurelius, Thomas Jefferson, and Solomon. (Maybe Trajan…)

    More to the point, though, are the Orwellian pigs who started their reign with noble causes and then fiddled away into self-indulgence. Guys like Napoleon who began as the indomitable spirit of the French Revolution, and then the next thing you know he’s marching on Moscow. Or Mussolini, whom Churchill, Roosevelt, and Gandhi praised as the ideal president in the early 20th century… whose trains ran on time and economy was soaring before he wanted to co-dominate Europe.

    The Romans used to say that the only person fit to rule was the one who wouldn’t want the job. (Which was the case with Aurelius…) And the idea behind that phrase is that it takes an impressive amount of arrogance to want to rule an empire. Of all the human error I would not want in a ruler, the stench of egotism out ranks them all.



    Cory: "And not agreed that we are inherently "untrustworthy." Your characterization flies in the face of vows we make to each other. No one is perfectly trustworthy, but many are trustworthy enough that we will pledge fidelity, friendship, cooperation, etc., even knowing that occasionally, we will falter."


    Sure… we make contracts with one another… but we do that precisely because we don’t inherently trust one another. The lease for my apartment sets up the rules for our tenant/landlord relationship. I agree to abide by the three pages of rules in exchange to have a place to live. Should I break any of the rules, my landlord can exact the penalty our contract defines. That gives legal recourse to strangers who don’t inherently trust one another.

    But also, contracts are all voluntary and limited in scope. The landlords can’t on a whim decide to tax me of half my belongings (upon threat of incarceration), because that isn’t in the contract. Rulership is much more than a contract defining a relationship. Rulership is forced upon us… I didn’t vote (“pledge” or “vow”) on behalf of H, or Tim Johnson, but I have to follow the laws they create. And this is why I am so strict with elected leaders… there is no conflict of interest between a politician and her supporters. And the ‘politician’ doesn’t need the powers of rulership to organize many good programs for just her supporters. She only needs rulership when she is forcing her non-supporters (non-voters, non-pledgers, non-vowers) to go along with a certain program. So it’s the other 49-% that need Constitutional guarantees… to make sure that the politician damn well isn’t treading on their interests without exceptionally good cause.

    (continued…)

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  25. Roger: “People are not inherently evil. Like Cory I would completely reject this. I would rather state humanity is inherently foolish, even stupid. We will believe things for little more reason than we desire them to be true or because we fear they may be. Elected leaders are meant to exemplify the greatest character in society, men like the founders who sacrificed their fortunes and freedom when they declared independence and desired political position rendered weak in worldly attraction so as to attract people of nobility devoted to people's freedom.”


    Exactly which members of Congress or the White House in recent memory are you suggesting “exemplify” the greatest character in society? Ted Kennedy? Dan Quayle? I’ll accept your description of “inherently foolish, even stupid” and still maintain that our Constitution should be crafted to keep such humans as limited in power as possible over people that don’t favor them.



    Cory: “Shaky. I could easily turn Prin.I. around and argue that no man deserves his freedom. If we are untrustworthy sinners, why do we deserve free rein to sin? Why not impose a king ordained by God? Why not restrict individual action to only vitally necessary actions?”


    Ok… let’s analyze your argument here. (1) Humans A, B, and C are sinners. (2) Because B, and C are sinners, they should take all instruction from sinner A, because he’s delusional and thinks God appointed him.

    Umm… yeah… you really showed my argument who’s boss.



    Cory: “There will be fewer senators and presidents than mayors. The qualifications for Senate and White House should be higher. But the citizen who can prove himself/herself fit for those highest positions may be as justified in setting policy for the millions as the mere mayor is in setting policy for the hundreds.”


    You know I respect you highest among my friends, but this is quite possibly the dumbest thing you’ve ever stated. Did you even think about the latest presidents and their elections before writing this? Let me give you a recap:

    2008 – McCain wins the nomination by taking the word ‘timetable’ out of context, H wins by the efforts of Acorn and running newcomer Palin through dozens of baseless lies perpetuated by bloggers

    2004 – Dean’s misplaced exuberance gives Kerry the nomination, W swiftboats Kerry

    2000 – W wins the nomination by push-polling lies against McCain, beats Gore on the issue of hanging chads

    1992, 1996 – Clinton wins because Perot splits the conservative vote

    1988 – Dukakis makes a video where he’s gleefully riding in a tank and refuses to consider the death penalty in a hypothetical

    1984 – Reagan does not “exploit, for political purposes, my opponent's youth and inexperience."

    1980 – Reagan paid for that microphone, Carter was a victim of circumstances outside his control (Tehran hostages)

    1976 – Ford says that the Soviets do not dominate Eastern (sic) Europe

    1972 – McGovern had to switch VP running-mates because the first one hid the fact that he suffered from depression

    1968 – Nixon sabotages the Paris Peace Accords so that the Dems can’t make peace in Vietnam

    1964 – The totally preposterous Daisy commercial lie

    1960 – Nixon fails to wear makeup in a TV debate


    You know full well that the polls show the candidates at different times in the campaign as being up or down… getting significant bumps on the basis of press cycles. Had the 2008 election been held on a different day, McCain could easily be our president. It’s all a game of using propaganda to manipulate the minds of the citizens. (e.g. the current healthcare debate) And which of these selfish bastards do you really consider an enlightened governor who deserves to rule over their peers? Wipe-my-butt-with-the-Constitution W? Cheat-on-my-wife-with-an-intern Clinton? I-can’t-spell-potato Quayle? I-invented-the-internet Gore? Read-my-lips-Bush-Sr?

    Furthermore, can you name even 2 current virtuous senators?

    I’ll take Gene Hexom over any of them.


    (continued…)

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  26. Cory: “Your harms via stagnancy equal my harms via change... and you impose a more convoluted and unresponsive system. Your percentages are a recipe for perpetual gridlock. Feel free to make a case for consensus government... but that sounds more utopian than practical majority rule with protection of fundamental minority rights.”


    With what authority can you state that our harms even out? Where’s your proof? Sure a consensus government means more gridlock and that the government cannot act hastily (that’s the point)… but that doesn’t rule out citizens from solving a problem on their own (e.g. Red Cross). Furthermore, when decisive action was needed, Congress entered WWI and II with near-unanimous approval. Same for Katrina disaster relief. Same for the original patriot act. (And consider, T.A.R.P. only got about 75% approval… which I think I can safely assume that we’re all wondering if that was a good thing in hindsight. And the patriot act would have sunsetted out of existence in December 2005, because the reauthorization vote only managed 89 senators.) Contrary to your delusions, a consensus government isn’t going to be unresponsive in no-brainer situations.



    Cory: “(b) I rarely itemize: standard deduction is sufficient.”


    I was referring to business deductions. As a C.E.O. of one business, C.O.O. of another, and a man of significant self-employed income… keeping every single business receipt and categorizing (and sometimes depreciating) the amounts becomes a very significant (and invasive) task. Sales tax for my businesses takes me about 2 minutes a month.



    Cory: “(c) I agree complexity and lawyers are problematic. I welcome simplification ("How much did you make? Subtract the poverty line. Multiply by 15%. Send.")”


    I’d certainly welcome that, but I don’t think 15% is going to cover the current federal budget… we’d need something more like 45%. 15% doesn’t even cover FICA if I remember correctly… and the first tax-bracket is 10%. But yeah, a one-tax-bracket, no-deductions, no-nonsense income tax is a solid 2nd place rival to my sales tax proposal.



    Cory: “(d) No advantage for sales tax -- who adds up all their sales tax at the end of the year? Penny here, penny there... sales tax is sneakier!”


    Again, consider taking all the federal income tax and rolling it into sales tax… we’re talking about a roughly 25% federal sales tax. That’s noticeable. And that will get voters wanting to elect politicians who will ratchet down the tax burden.



    Cory: “We're both looking to key tax to wealth: the difference is I tax when we get the wealth, you tax when we use the wealth. Income tax beats outgo tax: a year when I have lots of expenses (not always by choice) may not be the best time to charge me more taxes. It's easier, I think, to absorb a higher tax burden that coincides with higher income.”


    If the involuntary expenses you are referring to are “essentials” (food, shelter, health care, etc), then my sales tax doesn’t hurt your situation any. And if you’re a responsible citizen who makes money and then saves it for the day of involuntary expenses, my sales tax helps you there, too… more interest accrued.

    Other benefits I forgot earlier:
    1) In terms of principles, I would rather “punish” a person for profligate spending than “punish” him for responsible earning.
    2) A person can always afford sales tax… no one goes to jail for failing to pay sales tax, because if they can’t pay the sales tax, they simply don’t buy the (non-essential) product.
    3) Sales tax collects from illegal aliens.
    4) Sales tax collects from illegal activity… the drug dealer eventually takes his wad of cash and purchases an Escalade.


    Your fellow Democrat,
    David

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  27. David, no argument from me on current elected leaders exhibiting the kind of nobility I described. I didn't think I had even implied such a thing. We were discussing the principles of good rule/governance. It would make sense that what we describe is not what IS, it is what we think should be. The difference between us is that I think such a thing is possible with reform, while you think power will always maim their soul. The fact of the matter is that no measure of checks or balances can ever completely prevent the mischief of the egomaniac. The only way to prevent it is to have an awake, moral, and educated electorate that will not elect the "sinners" in the first place.

    Your consensus idea might work if the demand was for a super-majority of 65 or even 75 percent. I just don't think that 95 percent could ever work. It is a bad idea to set up a system that can be held hostage by the "gang of seven"

    Back to the original topic: taxes! It is a very dangerous thing for a democracy to allow the sacrifices inherent in government spending to be avoided. Even the poor should feel enough of that pain to understand the cost of government gluttony. A sales tax does this, an income tax does not.

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  28. Hi Roger,

    You just might be my new best friend. I'll take into consideration your revised percentages. The 'gang of seven' situation makes for interesting anti-lobbyist scenarios that I hadn't thought of before... e.g. the nasty corporation (Fannie Mae?) only has to pay off seven senators to stop a bill that would shut them down.

    Glad to hear you're down with the sales tax idea... I really don't understand why it's not immediately attractive to more people. We all know the games around income and property tax... and the fact that illegal immigrants totally evade both. It makes more sense to me to construct a society where being a citizen is a benefit, not a hindrance. Illegal aliens really wouldn't be a problem if they all paid the same tax as citizens, yet were denied government programs. That would encourage them to want to be registered citizens... rather than the status quo where it's advantageous (tax-wise) to not be.

    Kind regards,
    David

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  29. Interesting comment I came across... Relevant to our discussion of consensus government VS practical majority rule with minority rights.

    "There are two ways a "strict" democracy can be modified. One way is just modifications that make things harder to change: such measures include the presidential veto, the bicameral legislature, supermajorities, ennumerations and limitations on legislative power, and the like. The other way is to change the weighting of different groups. Measure such as equal representation for unequal district sizes are an example of the latter type.

    "The former type of deviation from strict democracy really DOES protect minorities, insofar as preventing change protects minorities. If you require a 75% supermajority for passing laws, then if only 74% want to pass a law that, say, bans a minority religion, then they won't be able to do it (let's assume there's no first amendment here). With a stricter, more democratic majoritarian system, 51% is always sufficient.

    The latter deviation from democracy does not protect minorities. It empowers specific groups and disempowers others."


    http://delong.typepad.com/sdj/2005/05/equal_suffrage_.html

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  30. I should perhaps refuse to reply until David verifies he is legally accessing the Internet, as I the socialist in the room am via a connection paid for by my hard-earned money.

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  31. While I wait for David to clear his conscience and write a check to his neighbors, I can't resist a few responses.

    "conventional wisdom"--ah, so now David cloaks his assertion in the false robes of "lots of people believe what I believe, so it's a good argument." Poppycock. You can rattle off your list of famous error-prone powerful people simply because they are famous. You then straw-manninshly compare them to a meager list of sterling rulers rather than a much longer list of competent rulers who never made the news with genocide, cannibalism, or trysts with interns. We are all error-prone, yet most of us manage to get through the day without blowing stuff up, be we teachers, tech dudes, or technocrats.

    Trust and contracts: so it sounds like the only reason David dares rent, work, or otherwise emerge unarmed from his home is not because he trusts the common folks around him, but because he trusts rulers to exercise their power and enforce the law.

    Showing who's boss: still no reply, no comparative advantage to David's proposed scheme. If we are all sinners, then the demos and the dictator are equally worthy to rule. And David offers no response on why we do not have laws restricting every person to only the most vitally necessary actions to restrict their potential range of sinful action. David's philosophy leads to tyranny, not freedom.

    "...the dumbest thing you've ever stated": again, nice list of scuzzy Presidents. Gene Hexom's sins don't make the national news. Subject Gene Hexom to similar journalistic and historical scrutiny, as well as every other mayor, and you'll come up with a comparable list of foibles that will shake your faith in mankind... or simpy remind you of your initial premise, that we are all sinners, that defeats your entire argument. (See also the availability heuristic to understand where David goes wrong.)

    Harms evening out: I offer a reasonable logical argument demonstrating similar harms on both sides. I'm also Neg, defending the icky but serviceable status quo. David is Aff, proposing an entirely new plan for operation of the Republic. Thwack!—burden of proof back on your side of the net.

    15% Income tax: I'm more about the principle than the number. I was guessing. However, I notice 2008 US GDP was $14.2T. Estimated FY2009 income tax receipts (indiv. and corp.) were $1.55T. That's equiv. to 11% of GDP.

    Sales tax: But David's sales tax relies on rulers to decide what constitutes "essentials." Dang. Another good idea killed by lack of moral comparative advantage with the status quo.

    And taxes are not punishment. They are the price of admission to society.

    Support the troops: pay your taxes.

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  32. "I should perhaps refuse to reply until David verifies he is legally accessing the Internet, as I the socialist in the room am via a connection paid for by my hard-earned money."

    You must really hate income tax, then. It allows illegal immigrants to benefit from roads, judges, and police without paying for it from their hard-earned money.

    Rest easy, Cory… no need to rush to hasty judgments. I only pilfered bandwidth because Comcast couldn’t get to our apartment the first few days after we moved in.



    “"conventional wisdom"--ah, so now David cloaks his assertion in the false robes of "lots of people believe what I believe, so it's a good argument." Poppycock. You can rattle off your list of famous error-prone powerful people simply because they are famous. You then straw-manninshly compare them to a meager list of sterling rulers rather than a much longer list of competent rulers who never made the news with genocide, cannibalism, or trysts with interns. We are all error-prone, yet most of us manage to get through the day without blowing stuff up, be we teachers, tech dudes, or technocrats.”


    Well I’m talking to the guy who is defending “lots of people vote for X, therefore it is the right thing to do” so I didn’t think an appeal to conventional wisdom was totally irrelevant. (Backed up with analysis, btw… to my parables of Napoleon/Mussolini you offered no counter-example of a ruler who became progressively less corrupt as time went on.)

    And you didn’t seem to dispute the fact that the quantity of really evil rulers vastly outweighs the quantity of consistently good rulers. From that evidence we can infer that the bell-curve of human rulers has a mean much closer to “power hungry egomaniacs” than it does to “selfless servants of the state”. In other words, probabilistically, ruler X is much more likely to be malevolent than benevolent. Sure you point out that I ignored the middle-ground… but so did you. You presented no quantification... no assurance that we have even as good a chance of a benign ruler as a malignant one. You didn’t even bother trying to use your own, hyperlinked, availability heuristic… just appealed to a vague notion that there are lots of serviceable rulers, but because their crimes don’t make the headlines/history books it would be too hard to count them.

    What I really don’t understand is why you’re even debating this point, because I’m pretty sure that you agree with me. You clearly affirm that humans are all error-prone. And I believe we also agreed on the point that republic/democracy is better than any form of tyranny/oligarchy because investing eternal rulership power into one error-prone person/group is a terrible idea. I mean inherent in your defense of the status quo (4-year-terms) is the idea that even the best rulers need to have their error-prone-ness checked out by the public on a regular basis. Correct me if I’m wrong, but you wouldn’t even be willing to elect darling Dennis Kucinich as president-for-life.

    If, perhaps, I’m just misreading you, I would love to hear your case for why some people are more fit to rule than others. And how we would recognize them.



    “Trust and contracts: so it sounds like the only reason David dares rent, work, or otherwise emerge unarmed from his home is not because he trusts the common folks around him, but because he trusts rulers to exercise their power and enforce the law.”


    This is true. You and I agree that we need a government to enforce laws against violence and fraud. And I’m pretty sure that the state laws that give me the confidence to enter society without fear would be easily supported by 86.64% of the public.

    Why did you even make this point? Did you somehow think I was advocating anarchy?


    (continued)

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  33. “Showing who's boss: still no reply, no comparative advantage to David's proposed scheme. If we are all sinners, then the demos and the dictator are equally worthy to rule. And David offers no response on why we do not have laws restricting every person to only the most vitally necessary actions to restrict their potential range of sinful action. David's philosophy leads to tyranny, not freedom.”


    Tyranny is one sinner ruling over a million citizens. Democracy is a million sinners ruling over a million citizens. That’s less rulership per person, which is consistent with my founding principle that any sinner should have as little rulership as possible.

    I didn’t think you offered the “vitally necessary” counter-plan seriously. If you indeed are serious about it, tell me how it works… who chooses what’s vitally necessary and by what margin of votes? Work out the details, and I’ll draw up a fair comparison to my consensus plan. But if this is just another way of trying to make me look autocratic, you have my rebuttal in the paragraph above.



    "...the dumbest thing you've ever stated": again, nice list of scuzzy Presidents. Gene Hexom's sins don't make the national news. Subject Gene Hexom to similar journalistic and historical scrutiny, as well as every other mayor, and you'll come up with a comparable list of foibles that will shake your faith in mankind... or simpy remind you of your initial premise, that we are all sinners, that defeats your entire argument. (See also the availability heuristic to understand where David goes wrong.)”


    Defeats my argument? You mean proves my argument. If we found gross foibles and sinning among politicians of all ranks it would support my founding principle. (Also I don’t like your insinuation that my friend Gene Hexom is skuzzy without showing proof. Has he lied to get elected, brought a Patriot Act upon Madison, or slept with his intern?)

    Foible-mongering aside, how does anything you say here back up your original point: “But the citizen who can prove himself/herself fit for those highest positions may be as justified in setting policy for the millions as the mere mayor is in setting policy for the hundreds.”?

    I didn’t pick and choose as you suggest, but instead exhaustively showed how presidential elections in the last 48 years have nothing to do with proving that a person is actually more fit to be president. Elections are determined by lying (swiftboat, push-polls, Daisy commercial), corruption (sabotaging Paris Peace Accords), smooth talking (“I paid for this microphone”), or quirks of fate (failing to wear makeup for a TV debate). Which of these qualities make one ‘deserving’ to rule over hundreds of millions of people with broad and invasive influence?



    “Harms evening out: I offer a reasonable logical argument demonstrating similar harms on both sides. I'm also Neg, defending the icky but serviceable status quo. David is Aff, proposing an entirely new plan for operation of the Republic. Thwack!—burden of proof back on your side of the net.”


    Your argument was reasonable AND logical? Oh my, how did I disagree with that?

    Oh that’s right. I gave clear examples of crises in American history and showed that my consensus standards would not be a barrier. Show me that I have any harms at all, Heidelberger. My harms against the status quo have been oft-cited across your blog: endangered species act, no child left behind, ethanol legislation, NASA, mohair subsidy, TARP, Patriot Act reauthorization, eminent domain, etc.


    (continued)

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  34. “15% Income tax: I'm more about the principle than the number. I was guessing. However, I notice 2008 US GDP was $14.2T. Estimated FY2009 income tax receipts (indiv. and corp.) were $1.55T. That's equiv. to 11% of GDP.”


    GDP? Why would you compare it to the GDP? Why am I paying over 30% of my income in tax if the government only needs 11% across-the-board to make it work? I can assure you I’m not 3 times wealthier than the average taxpayer. You can’t seriously believe that number… Remember that W-2 employees only pay see that they pay for half of their FICA burden.

    Also… since when have you been “more about the principle than the number”? I thought that was always your canned response to me: “David runs around with his head in the idealistic clouds while we need to be looking at pragmatic numbers to actually solve real problems.”



    “Sales tax: But David's sales tax relies on rulers to decide what constitutes "essentials." Dang. Another good idea killed by lack of moral comparative advantage with the status quo.”


    Easy fix: ‘essentials’ are determined by the voting thresholds I proposed. Alternatively, even if I can’t achieve my grand overhaul of the government, I’ll still advocate sales tax alone as a minor repair of the status quo, where essentials can be determined by a simple majority. Either is better than any form of income tax. (And much better than property tax.)

    I didn’t see any arguments against the nine advantages I showed for sales tax over income tax… so I’m assuming your only hang-up was my supposed moral contradiction… which is kind of silly, because that’s really for me to worry about. (And if I had a moral problem with an expanded sales tax, do you think I would have written in support of it?) You should rather be thinking about how the proposed sales tax resonates with your own moral/political ideals.



    “And taxes are not punishment. They are the price of admission to society.”


    Ah… always the sophist. Think of it as price of admission or punishment, I don’t really care. The point is simply that either way money is coerced out of me upon threat of incarceration. And illegal immigrants, who benefit from the tax-funded services of our society, aren’t paying income tax, but they would pay a sales tax.

    Kind regards,
    David

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  35. “And taxes are not punishment. They are the price of admission to society.”

    David might not care about the semantics or your comment, but I do.
    A punishment is action taken to discourage behavior (isn't that the explicit justification of many taxes such as cigarettes or booze...or pop) It doesn't matter to the individual taxed if the intent of government is to do this, they will still have their behavior influenced and therefore are still punished by taxes.
    Who's society is this the price of admission to? It seems to me that society still exists whether or not we sustain it through minimal taxation or by a progressive dictatorship, and your argument would remain unchanged across that spectrum. It would justify ANY level of taxation since Cory could always say 'tough beans, that's just the price of admission'
    Ideologically, just taxation must have limitation in purpose instead of a blind desire to lower taxes no matter what. David would say it would be defined by consensus government (which is what we already have, he simply makes the hurdle higher and thinks this solves something) Cory doesn't seem to want limitation at all, he just wants the taxation to be equitable.
    The further away ownership and decision-making becomes, the less responsive it becomes (call it sinfulness, stupidity, or corporate corruption, it still doesn't respond well). Unless there is a truly compelling reason that something must be operated at the national level, it shouldn't be. Where outside of military spending could is that true? The second control is to spend what we have - not what we project to have or could get in the future by increasing taxes. Collect the taxes and then set the budget based on that, borrowing money only by bond sales to the citizens you are spending on. Lastly, Tax essentials. It may be compassionate to make life easier, but it also helps dilute personal & political social responsibility. Taxes must be felt by all citizens or they will fail to maintain their active role to participate in the process. It also frees those of us who are better off from attending to the poor ourselves, secure from guilt by the belief the government is there to help our fellowman and we don't have to

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  36. Illegal immigrants and income tax: red herring! I don't like illegal immigration, so I should scrap the income tax? Nuts! I should leave the tax system alone and enforce the immigration and labor laws on the red-blodded American employers who create the demand for illegal immigrants by hiring them to skirt the law and inflate their profits!

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  37. Roger... that was an incredibly insightful comment. Here's a snippet of an email that I wrote last year that explains how my consensus idea ties in to our mutual desire for local legislation over national:


    Voting threshholds. Here's the question you need to ask yourself... on any piece of legislation does it make more sense to have it legislated in a broad scope or a narrow scope? I contend a narrow scope, with the following reasoning:

    As a US citizen, I am 1 out of about 300,000,000... so I am hardly influential at all in any national legislation.

    As a SD citizen, I am 1 out of about 800,000... so my vote is 375 times more influential in the outcome of state legislation than in a national one.

    As a citizen of Sioux Falls, I am 1 out of about 150,000... my vote is 2000 times more influential in city legislation than in national legislation (5 times more influential than in state legislation).

    As a participant in my marriage, I am 1 out of 2... my vote is 150 million times more influential in family policy than it is in national policy.

    With that in mind, it seems to me that it would be natural for these different institutions to have a reciprocal influence on my life. My life should be determined by family policy 150 million times more than national policy. And this is not unreasonable, considering that every decision we make on what to eat, which movie to rent, how to spend our evening, what color our walls should be, etc. is family policy in one sense or another. This is a sensible barometer of determining when a government is too fascist (ie overstepping its threshold of tolerable coercion). It would be an over-reach of government (at any level) to tell me what movie I'm going to watch tonight (if any), or which sheets go on my bed (if any). Yet those kinds of policies must be decided, and that's what the family is for.

    The local government should thus be 2000 times more influential in my life than the national government, since I have 2000 times more influence. City ordinances, no parking zones, stop lights, zoning laws, etc. all have a pretty significant influence on my day-to-day activities... but I think more things should be handled at the local level. Whether or not we have public schooling should be a local decision, and exactly what gets taught there determined absolutely locally (ie junk No-Child-Left-Behind, and let the school board teach creation or Scientology if they're so inclined). Voters in California and New York shouldn't be able to touch what Sioux Fallsians want to teach their kids. Also get rid of the EPA as a national organization and let local water boards, health boards, and concerned citizens police the cleanliness of their environment. If the people in Rapid City don't mind putting up with stank air and gross water, who are we to deny that?

    The important concept is that the more local the legislation, the more influence a citizen has on it... and so the more influence it should have on him.

    Second, the more local the legislation, the easier it is to move away from it. If Sioux Falls passed some crazy law whereby public schools would teach Scientology or they decided to put LSD in our water, I could pick up and move to Crooks, Tea, or Harrisburg without too much inconvenience (still live by my friends and family, still go to the same job and church). But as a decision becomes more global, it is harder to move away from it. Right now, if I want to live in a place where standard abortions are illegal, I have to leave the country... and that is not convenient.

    Third, when decisions are made locally, I have more access to the decision maker(s). If Mayor Munson passed No-Child-Left-Behind, I could drive across town and kick him in the mouth (or reason it out). I can't do that to President Bush or Ted Kennedy.


    (contintued)

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  38. With the general concept thus described, the question is how can we make sure that legislation would filter down this way? What's to stop Congress from putting Scientology in the public schools or the US Supreme Court from making standard abortions legal?

    My proposal for that is to require different thresholds of majority. For the US government I suggest that we need two standard deviations of approval (95.45%). "But then nothing would get passed!" Not much, I agree. The things that would get passed are the absolutely most common-sense laws. We're talking about coercing the whole country into obeying a certain idea, so it is not unreasonable in my mind to require all but unanimous approval. With a threshold of 50%, we pass and repeal national laws like they are fashion trends. Congress overreacts to minute details they have no business dealing with. The dismal swamp southeastern shrew was an endangered species... so any landowners with a dismal swamp southeastern shrew on any acre between the Atlantic and Pacific have to stop using that land for your own purposes lest you kill a shrew (up to $50,000 penalty). Now the shrew is delisted because 15 years later they found that the original species data was flawed.

    Laws that impact 300 million people should not be carried out so recklessly. Kentucky can protect the shrew on its own, if those citizens are concerned. The legislation from the federal government should be only the most solid common sense ideas... no pork, no vote-trading, no lobbyists. Getting elected to the US Congress would be almost a do-nothing job (why should it be otherwise?). The federal laws should be an unmoving bedrock upon which states and cities can confidently build the foundation of their own legislation.

    State legislation should require 1.5 standard deviations of its citizens (86.64%). Again, we're talking about coercing a whole state, so the bar should be high (but not as high as the national bar).

    City legislation: 1 standard deviation (68.27%) It should take about 2/3 of the population to raise a city tax for a swimming pool. You can always do private fundraising if that percentage is unreachable, but I can't see it being fair to 49% of the city to have to pay for something the other 51% wants.

    Family legislation: simple majority. If 6 of your 10 family members want to eat at Chuckee Cheese, the other 4 should go along with it (provided Mom and Dad say they can afford it).


    Kind regards,
    David

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  39. Cory - Red herring? I didn't offer sales tax as the sole remedy to illegal immigration. (Or attempt to get us off topic, which is technically what red herring is...) Just stated that with a sales tax illegal immigrants pay their 'price to admission', where they don't with income tax.

    This is a legitimate advantage of sales tax over income tax. One of about nine.

    Kind regards,
    David

    ReplyDelete

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