Economics - Robin Hood Explained

In a previous post, I compared Obama to Robin Hood for stealing from the rich and giving to the poor. There, however, is a difference with which Robin Hood may take offense to the comparison. There are two ways to view our hero. The common way is to see him as a friend of the poor and enemy of the rich. The other as is to view him as a champion of property rights. The current Administration can be seen similarly to the former, but not the latter. In the story of Robin Hood, the working class poor people were taxed heavily as the rich became richer. The workers were not allowed to keep the fruit of their labor. Robin Hood was merely giving back to them what was taken unfairly. He was not really stealing from the rich; he was returning to the poor what was stolen from them. In fact Robin Hood was part of the noble class until a new ruler came to power and began behaving so mercilessly to the poor. Robin Hood had not made it his life long mission to redistribute wealth. He chose to act only when the rights, particularly property rights, of the poor were taken away from them. In today's society, we have a much different scenario. The poor are hardly taxed at all. Even the middle class is taxed lightly. For that family that politicians love to discuss, the one with a couple of kids a mortgage and are making less than $100,000, their taxes are not burdensome. I can say that because I fall into that category and my Federal effective tax rate remains in the single digits. In fact, my state tax bill nearly matches my Federal tax bill and the highest Virginia income tax rate is a mere 5.75%. Also, there is such a thing now as an Earned Income Tax Credit. What this means is that if a person works but makes little money, that person can actually have negative tax where the government owes them money. This is different than a refund, please do not be confused. A typical refund is the result of a person's calculated tax (ex $5,000) being less than the taxes withheld from the person's paychecks for the year (ex. $6,000, resulting in a $1,000 refund). In the Earned Income Tax Credit, the person can have paid nothing to the Federal government and will still receive money. When in the history of the world has a government not only decided to not collect taxes from its workers, but to give them tax money? Combine the low taxes for the middle class and negative tax for the poor with the services they receive from government programs and it is an extremely difficult argument to make that our government is abusing or taking advantage of the poor or middle class. Robin Hood would not have had to quit his day job if he had lived in the US today.

If all of the President's initiatives go through, the wealthy will have about half of every additional dollar they make taken from them when all taxes are considered, much of which will go to social programs for the poor and lower middle class if not given directly to them. I find it hard to see how this is not stealing from the rich and giving to the poor, the key word there being "stealing". I have read articles and experienced in my own work where employees have stolen from their companies for great causes - for a family member in need of medical assistance, for nice clothing for their children, and even for a favorite charity. These stories are compelling, but how do the courts of our government respond? The defendants are convicted, fined, and/or sentenced to jail time. Why? Because the laws of our country do not recognize need as an excuse to infringe on property rights or, in simple terms, steal. Yet our government does it openly and unapologetically as if it were a virtue.

A person choosing to donate out of their excess to those in need is certainly worthy of praise and should be considered virtuous. I feel good about my donations I make throughout the year. I can see some of the impact these donations have. I feel no sense of honor or virtue by having my money forcibly taken from me by the government and given to somebody else, nor should anyone. There is no voluntary sacrifice in that. The approval rating of Congress stands in the teens and it has been well earned. The government has proven over many decades to be highly bureaucratic and highly inefficient. I have much more confidence that the money I donate to local charities will be spent wisely than the money the biggest charity, the Federal Government, takes from me. While I do favor a progressive tax rate, one where the wealthy are taxed at a higher RATE than the middle class and poor, there has to be some limits. We are moving in a direction where the tax rate is so high and burdensome that we must consider if there truly is any virtue in our actions, in forcibly stealing from one group and giving to another with the money being run through a very inefficient organization with a high overhead that eats away at the money stolen. We would be better off to have a little more respect for property rights and allow the American people, even the wealthy American people, to decide how to distribute/spend their income and wealth. I have more trust in the virtue of Americans (yes even rich ones) than I do in Congress and our government.