The Poor should Subsidize the Rich?

camel
Camel traveling down a road paid for by regressive taxes

 

The poor should subsidize the rich sometimes?  I have met very few people who like to pay taxes but they are necessary for the continuation of our society.  We all need roads, police, firemen and other government services whether we want them or not.  Everyone benefits from these types of government services so it seems fair that everyone should pay their fair share of the cost.  Some people benefit more from these types of services than other people and are getting a good deal. This is true of police and fire services which are really just a type of insurance because you are paying for a service you hope you never have to use .  No one wants their house to burn down or be burglarized but there is always a chance it could happen to you so you pay money just in case your number comes up.  There are simply not enough rich people to pay for all necessary government services by themselves so government usage fees (taxes) of less fortunate people became a necessity.  We have gas taxes, toll booths, wheel taxes, car impound retrieval fees, fines for speeding and other methods of generating revenue which place a disproportionate burden on the finances of less fortunate people.

An oversimplified example:  An ultra rich man named Bill Gates gets a $100 ticket for speeding or a poor working mother named Betty with two children and a dead husband gets a $100 ticket for speeding.  Neither person should have been speeding but is it really fair to charge Betty and Bill Gates the same fine (tax).   I would fine people an appropriate percentage of their income instead of an arbitrary fixed dollar value .  Bill Gates would not care if he had to pay some paltry fine so how will he ever learn a lesson from it?  If he had to pay even 4 percent of his income he might wake up and smell the coffee.  Betty should be charged less because monetary fines are a severe drain on her limited resources and she will learn her lesson easily.  Our current system makes it easier for the rich Bill Gates to speed.  Why not take a greater significant percentage of a rich speeders money and use it to fund police and road construction?  This would improve public safety and revenue collection.

Health insurance/treatment is similar in some ways because it is a necessity unless you want to take a chance on dying prematurely.  Few people choose to be ill.  Some people are blessed by God with good health and will never need a doctor’s service or at least not much service.  Other people may have severe illness such as diabetes, cancer, stroke, crohns disease or some other severe disease that is life altering and expensive to treat.  You pay an insurance company but you hope you don’t have to use their services to pay for some dreadful disease.  The insurance company distributes this horrible risk among many people.  The healthy people pay for the really ill people and most healthy people do not really directly benefit except by having emotional security from being insured in case the worst happens.  Health insurance in essence is a transfer of financial wealth from one large group of people to another small group of people who have done nothing to earn the money. Is that a good thing?

An oversimplified example:  Bill Gates gets Crohn’s disease and is insured by XYZ insurance company.  Bill will need about $200,000 per year in treatments over the remainder of his lifetime to keep his bowels operating normally.  Bill’s premium payments amount to $12,000 per year so XYZ insurance company is losing some big time money because Bill has a bad disease.  How should this money be recovered by XYZ?  Obviously they will either raise their rates on their other members or find someway to get rid of Bill from their plan.  It’s not Bill’s fault that he is ultra rich so I don’t believe it is right to eliminate Bill’s treatment and insurance.  Less fortunate people should subsidize Bill Gates in this condition because he paid his money into the system in case this type of thing would happen to him.  A single mom named Betty should be treated just like she was Bill Gates if she had the same condition.

What’s the point?  Some things require us to work together even when we don’t see the direct benefit to us because it’s for the good of our society as a whole. The United States needs some type of insurance plan that includes coverage for all citizens or it just won’t be fair.

 

 

 

 

 

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2 thoughts on “The Poor should Subsidize the Rich?

  1. Hi Glenn! Interesting theory about the speeding tickets. I’ll have to think about it; not sure I would agree with it since it would take a lot more bookkeeping and cost all of us more to keep track of making sure people pay the right percentage. Also, you didn’t mention what business owners pay for to keep the economy going…i.e. FICA. Although I paid high taxes for my office building in Greenfield, I did not have free trash removal and had to pay a private company to pick up small amounts of waste. Very frustrating!! However, I always enjoy hearing about things from your point of view!–AM

    Liked by 1 person

    1. Thanks for the comment! You are are my number one commenter since I restarted the WordPress blog. The posts are also shared on Facebook and twitter so I have to be careful not to cause too much controversy or boredom among those readers.

      Fines for crimes can always be made self-supporting by raising the fine until all associated government expenses are covered. Increased income weighted fines are not that pretty but they would put real teeth into the law for high income scofflaws if enforced. This would reduce crime and may save lives. Driving under the influence and similar dangerous crimes would have more serious consequences for everyone using the “Glenn Way” fine plan.

      We need more business owners and government rules should be written to reduce unfair burdens like you describe. I used to work at Seiberling Associates eons ago and we encountered many conflicting laws and practices in different parts of the country. It was my personal job to jump through the many hoops imposed by government agencies that were obviously not well thought out on certain projects. I suspect some of the end user business owners may have made modifications to unreasonable requirements designed during the engineering phase by government agencies. That suspicion always made me a little sad because I hated to see my work go to waste.

      Like

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