If you believe Earth is flat, driving due east on the equator for 24,900 miles will leave you unconvinced that it’s in fact round. Only arriving back at your point of embarkation one mile later will persuade you.
Or rather, it should—but probably wouldn’t, judging by how stubbornly leftists cling to beloved economic notions that have been disproved time and again.
No matter that socialism has failed to end poverty, let alone create prosperity, everywhere it’s been tried. Americans who think they know better continue to insist that confiscating an ever-larger share of other people’s money will bring happiness to everyone else.
But wait. Today, in Cuba, the communist government announced that all Cubans will now pay a percentage of their income in the form of taxes. This follows on the heels, as CNBC put it, of free-market reforms that were introduced in the last couple of years in order to “encourage small businesses, private farming and individual initiative.”
In other words, a top-down economy fails, even on an island nation with a captive work force and a brutal, totalitarian dictator who believed for decades that he could mandate prosperity.
The government also envisions replacing subsidies for all with targeted welfare, meaning that the largely tax-free life under a paternalistic government is on its way out.
Weaning the Cuban populace off the public teat after 50 years and three generations won’t be easy, so the Castros wouldn’t be doing this if things weren’t worse than advertised.
“This radically changes the state’s relationship with the population and taxes become an irritating issue,” said Domingo Amuchastegui, a former Cuban intelligence analyst who lives in Miami and writes often about Cuba.
The new code covers 19 taxes, including such things as inheritance, environment, sales, transportation and farm land, various license fees and three contributions, including social security.
A sliding scale income tax – from 15 percent for earnings of more than 10,000 pesos (about $400) annually, to 50 percent for earnings of over 50,000 pesos, (about $2,000) – adopted in 1994, remains in the new code for the self-employed, small businesses and farms, but it also includes a series of new deductions to stimulate their work.
So Cuba now agrees that incentives play an important role in how humans behave, and that productivity is one byproduct of an incentivized work force. It also means that, as a percentage, more Cubans will be paying income taxes than Americans. How long before Cuba is more of a free-market economy than the U.S.? (Don’t laugh.)
In the United Kingdom, meanwhile, the magic word is disincentive.
It turns out that a recent tax hike on millionaires, who saw their marginal rate raised to 50 percent, has resulted in fewer millionaires residing in the UK.
This was utterly predictable and foreseeable by everyone except those on the left, including former prime minister Gordon Brown (whose previous post was chancellor of the exchequer, our version of treasury secretary), who believe tax rates have no effect on behavior or productivity of “the rich.” To compile their projections, they simply add another ten percent of what Mr. Millionaire is paying onto what’s already there, as if the numbers would be a zero-sum constant.
But oops, some people don’t take kindly to having their income confiscated.
It is believed that rich Britons moved abroad or took steps to avoid paying the new levy by reducing their taxable incomes.
George Osborne, the Chancellor, announced in the Budget earlier this year that the 50p top rate will be reduced to 45p from next April….
Last night, Harriet Baldwin, the Conservative MP who uncovered the latest figures, said: “Labour’s ideological tax hike led to a tax cull of millionaires.
Far from raising funds, it actually cost the UK £7 billion in lost tax revenue.
It would be fine if those who believe the world is flat were the only ones headed toward the fiscal cliff. But they’re intent on taking the rest of us with them.
Prediction: A year from today, I’ll be able to replace United Kingdom with California and have the result be the same.
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“Prediction: A year from today, I’ll be able to replace United Kingdom with California and have the result be the same.”
Rachel Maddow will tell you that’s a “hysterical fantasy.”
LukeHandCool (who trusts Joel’s prediction and whose only question is, are Luke and he doomed to become a couple of fish-and-chips-eating, lazy limey sods?)
“are Luke and he doomed to become a couple of fish-and-chips-eating, lazy limey sods?)”
Doomed? You make it sound bad. Let’s just do it because our state is past its sell-by date, and I hear you can’t get good fish and chips in Texas.
I can see Barbara Boxer as the Queen and Jerry Brown as Prince Charles.
I suppose one could also call the standard liberal dis “Hangers and Bash” a rebash too?
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Raul is a piker: if he had half the political cunning of Nancy Pelosi, he would have turned this into a ‘tax cut for the middle class’ of Cuba.
After all, the communists won’t be taking 100% up front anymore…
I was around 15 years old and in high school in USSR, and that was during Perestroika, so some of my classmates were getting uppity. We were using standard Soviet textbooks, and our teachers were teaching us standard-issue Soviet crap that, I’m pretty sure, they no longer believed themselves.
At one point our Government teacher had to explain that in the US the taxpayers have to pay for government services like road construction whereas in Soviet Union the government itself covers the bill. A boy in my class raised his hand and said, “Well, where does the Soviet government the the money to pay for it?” The teacher responded “The government pays.” “But how?” “The government pays”. She knew she didn’t have an answer. They can call it a tax or not a tax, but it didn’t matter, it was all centrally planned, and the government withheld what it wanted from our labor, or what their chicken brains figured they should withhold.
I ran into something like that in Washington State this summer. I asked someone where the money came from for the constant street cleaning in a particular town and he responded “the general fund”. “Well, where does /that/ money come from?” “They pay for it out of the general fund.” “The money in the general fund comes from somewhere. Any idea where?” He scowled, mumbled, and walked away.
So, Pelosi is the Court Jester?
Because we have such talentless leadership in the GOP, we’re in a lose-lose situation. If we go off the cliff, the left wins by gaining more control of our lives. If we don’t, our corrupt news media will report it as the GOP folding. And any improvement in the economy will be reported by this same corrupt media as Obama’s doing.
Two solutions:
(1) Change the GOP leadership. The fact that a lox like John Boehner is the GOP Speaker is as great an historical perversion as Obama being president. The fact that a failure with the bizarre name of Reinice Priebus is the still the Chairman of the GOP is another perverse joke. How to get rid of these people? — Starve the GOP of cash until change comes.
(2) Invest in alternative media to put our message to the masses. This requires big GOP donors to divert the money they’ve been putting down the rathole of GOP national committee and into building a network of the type of media required. (Sheldon Adelson: did you catch that?)
Far from raising funds, it actually cost the UK £7 billion in lost tax revenue.
The goal has never been raising revenue. It’s power, control. The independently wealthy guy is the enemy.
Like “Kars for Kids,” let’s start a “Balz for Boehner” campaign. The House can pass anything they want by refusing to raise the debt ceiling. WE hold the reins.
Leftism, under its’ various names, has never been about growing the economy.
It’s ALWAYS been about dicktatorial control of the masses.
That leftism ALWAYS fails economically and was responsible for 200 million deaths in the 20th century should be enough proof for even the dimmest of the demwits.
Brainwashed liberals are in charge of brainwashing thus the results are predictable… more brainwashed liberals in the business of brainwashing.
I think the US should create a uniform Eager Beaver-Warren Buffet Tax Act. The act would heavily tax all senile billionaires who want to throw good money after bad. The test to determine who is taxed: those who have publicly demonstrated a desire for higher taxes and whose assets are valued at over $1,000,000,000.
The fiscal cliff would be avoided by the Oracle Tax Act. Right Warren Buffett? Right Paul Krugman?
Uhm, actually, regarding communism, socialism, and capitalism: Countries (ignoring governments) are made up of smaller economic units. Most businesses are internally socialistic economies (the largest have divisions that interact in a sort-of capitalistic fashion). Most families are internally communist. Some trace of fascism is needed at the national level to keep things operating smoothly. The groups have to interact in a capitalistic fashion. The groups cannot function otherwise.
A country cannot function if some of each economic model is not allowed to exist where it is needed, and trying to force the wrong one in the wrong place, or prohibit the appropriate one, results in suffering and death, and is futile anyhow.
Our social instincts (and greed) make us vulnerable to recruitment efforts by bandit leaders (community organizers), and most of us do not seem to realize how a country cannot function without the blend of economic models.