Taxing the rich!

For the past 10 or 11 weekends, there have been riots in Paris by the left wing “Yellow Shirts” over French President Jean- Mickel Macron’s economic policies.

The criticism has been that his policies favour the rich.

It has always amazed me how socialists view the economy. They seem to think if one segment of the economy is getting more than they are it means that they are getting that much less.

A functioning economy just does not work that way.

They have this utopian idea that everyone and everything has to be equal.

If that were to happen you would have a standard of living at the lowest common denominator.

The socialist communist regime in Russia tried that for 70 years and it eventually fell apart in 1989.

During that entire time, everyone in Russia was poor except the governing hierarchy because they controlled what little wealth there was and was able to provide a decent standard of living for themselves.

We seem to have a similar mentality in this country.

Left-wing liberals and socialists keep harping about the rich not paying their share of taxes.

The real fact is that the rich pay much more than their share of taxes.

For example, the top 20 per cent of income earners earn 49 of all income and pay 56 per cent of all taxes.

So that means 80 per cent of income earners earn 51 per cent of income but only pay 44 per cent of all taxes.

When it comes to income tax, the bottom 50 per cent of income earners only pay 9 per cent of income tax.

Now I agree that high-income people do not need the high level of income they receive but if they earned only half of what they are earning, the lower income people would not receive one cent more than they are receiving.

In fact, they would have to pay more tax to offset the decrease in tax from high-income earners.

Socialists believe society works best when the government has total control of the economy. They believe that the way to increase employment is to create more bureaucratic and government sector jobs.

For an economy to be strong somebody has to create wealth but they don’t understand wealth creation.

Government jobs consume wealth.

The government we have now in Alberta is a good example. I believe this government has added about 70,000 jobs to the government payroll while private sector jobs have decreased.

During that same time, they have been running a deficit of about $10 billion a year.

Borrowing huge gobs of money does not create wealth.

The money for government jobs comes from taxing hard working private sector workers.

There is no way that an economy could work if everyone was receiving equal pay.

God did not make people equal, he intended for us to compliment each other. We all have different skills. We should get paid by the value that our work contributes to the overall economy.

Socialists think that capitalism is at the root of the problem of many workers receiving lower pay than other workers. Of course, capitalism is not perfect.

Large corporations do create wealth and jobs but they avoid competition, so strong government oversight is required or their greed could overwhelm the economy.

What does create wealth is innovation and competitive private sector entrepreneurs developing businesses.

It is the incentive to make money that makes this work.

Competition makes for efficiency and productivity, a concept foreign to socialists. That is the driver that makes for a thriving economy. These are the people that create the real jobs.

Trade and government unions by nature are socialist so they successfully negotiate for higher pay but lower productivity.

That is why socialism does not work and one reason that the Alberta economy is in a mess today.


by Herman Schwenk

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ECA Review