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Walter E. Williams
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Future Generations

Comment

Is there any reason for today's Americans to care about what happens to tomorrow's Americans? After all, what have tomorrow's Americans done for today's Americans? Moreover, since tomorrow's Americans don't vote, we can dump on them with impunity. That's a vision that describes the actual behavior of today's Americans. It would be seen as selfish, callous and ruthless only if it were actually articulated. Let's look at it.

Businesses, as well as most nonprofit enterprises, by law are required to produce financial statements that include all of their present and expected future liabilities. On top of that, they are required to hold reserves against future liabilities such as employee retirement.

By contrast, the federal government gets by without having to provide transparent and honest financial statements. The U.S. Treasury's "balance sheet" does list liabilities such as public debt, but it does not include the massive unfunded liabilities of Social Security, Medicare and other federal future obligations. A conservative estimate of Washington's unfunded liabilities for the year ending in 2011 is $87 trillion. That's more than 500 percent of our 2011 GDP of $15 trillion.

Former Congressmen Chris Cox and Bill Archer have written an article — "Why $16 Trillion Only Hints at the True U.S. Debt," The Wall Street Journal (November 26, 2012) — pointing out our dire economic straits. They say, "When the accrued expenses of the government's entitlement programs are counted, it becomes clear that to collect enough tax revenue just to avoid going deeper into debt would require over $8 trillion in tax collections annually. That is the total of the average annual accrued liabilities of just the two largest entitlement programs, plus the annual cash deficit." Let's analyze that.

Washington would have to collect $8 trillion in tax revenue, not to pay off our national debt and have reserves against unfunded liabilities, but just to avoid accumulating more debt.

Recent IRS data show that individuals earning $66,000 and more a year have a total adjusted gross income of $5.1 trillion. In 2011, corporate profit came to $1.6 trillion. That means if Congress simply confiscated the entire earnings of taxpayers earning more than $66,000 and all corporate profits, it wouldn't be enough to cover the $8 trillion per year growth of U.S. liabilities.

Given this impossible picture, the message coming out of Washington, especially from our leftist politicians and the news media, is that we solve our budget problems by raising taxes on the rich. If Americans were more informed, such a message would be insulting to our intelligence. There are not enough rich people to satisfy Congress' appetite.

In 2011, Congress spent $3.7 trillion. That turns out to be about $10 billion per day. According to IRS statistics, roughly 2 percent of U.S. households have an income of $250,000 and above. By the way, $250,000 per year hardly qualifies as being rich. It can't even buy a Learjet.

Households earning $250,000 and above account for 25 percent, or $1.97 trillion, of the nearly $8 trillion of total household income. If Congress imposed a 100 percent tax, taking all earnings above $250,000 per year, it would bring in about $1.9 trillion. That would keep Washington running for 190 days, but there's a problem because there are 175 more days left in the year.

The profits of the Fortune 500 richest companies come to $400 billion. That would keep the government running for another 40 days, to mid-July.

America has 400 billionaires with a combined net worth of $1.3 trillion. If Congress fleeced them of their assets, stocks, bonds, yachts, airplanes, mansions and jewelry, it would get us to at least late fall.

The fact of the matter is there are not enough rich people to come anywhere close to satisfying Congress' voracious spending appetite. The true tragedy for our future is that there are millions of uninformed Americans who will buy the political demagoguery and treachery that our problems can be solved by taxing the rich.

Walter E. Williams is a professor of economics at George Mason University. To find out more about Walter E. Williams and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate Web page at www.creators.com.

COPYRIGHT 2012 CREATORS.COM

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Comments

21 Comments | Post Comment
This article is scarier than a Steven King novel. Most Americans don't have tickers strong enough to look at the entire US financial picture. Most people will ingore or deny it. What can be done when we have locked ourselves into this corrupt welfare-state system?
Comment: #1
Posted by: Chris McCoy
Mon Dec 3, 2012 11:23 AM
Sir;... The scary part about your article is that you can actually put strawdog arguments forward that are typical see through nonsense from the right perspective, and you take your self seriously beating the fluff out of your own creation...
Consider, that the country that makes possible great wealth for the wealthy and gives them a free ride on taxes might well survive by throwing people out in the street and starving them to boot; because virtually all people making 66 thousand dollars are really living hand to mouth, making their bills and laying nothing aside for the future... The difference between taxing those who can afford it is that their needs a better than well met, and the entire excess of that income might be safely taken from them without the slightest discomfort... You can talk all you want about taxing the income of the rich, and deny all you want that it would support the government... In fact, the extreme differences in income for over a century has resulted in the rich owning all they might value... If you are not willing to tax the wealth of the wealthy as this country once did, you can forget getting wealth out of those made poor to make the rich rich... We got the income tax out of an effort to have tax justice, so that class of people made wealthy through trade and commerce were on par with peasant farmers as far as taxes went... Income taxes at first affected only a fraction: 11 to 13 percent of the population... And the rich howled until the tax was lowered like a boom on everyone who could afford to pay anything... That could not possibly last when the rich were busy lowering wages to increase profits to such an extent that wages no longer supported anyone well, or the government at all... The rich have used tax structure to enforce injustice and garner all wealth unto themselves... The people are broke, and their government is broke, broker, and brokest... If the rich will not be taxed, then all the better because the government that defends their rights to their wealth will die and so will that defense... The rich can buy the affection of the government, or they can try to buy off the people; and I don't think that is really possible...You should never act, as you often do, as though the terms you use exist in a vacuum of abstraction... We give the law its force... We make the money mean... We give the rich their rights, and when the government can no longer serve the needs of the people in its efforts to serve the rich it can be replaced... We might possibly do worse... We could easily do better than our government as it stands...
We don't need to do anything for the people of the future to do well for them... What we need to do is say to hell with the ancient ideas that warped our constitution into a device to benefit the rich.. We need to damn the people of that age to the trash heap of history... They served the idea that good came from feeding wealth, political power and resources from the public to the private class of wealth... The idea is nonsense on its face... Some ideas should be buried with those who have them... Our constitution was one such idea...
Thanks...Sweeney
Thanks...Sweeney
Comment: #2
Posted by: James A, Sweeney
Mon Dec 3, 2012 2:59 PM
Dear Sweeney,
Thoughts are one thing. Ideas are another. Both can be rebutted. Facts are incontrovertible.
Your Friend,
Eric
Comment: #3
Posted by: Eric Wixom
Mon Dec 3, 2012 4:32 PM
Re: Eric Wixom... Every definition is an idea, or form; and every form/idea is a definition... Thoughts are what we do with our ideas, and as much as it is possible, our ideas/forms/definitions should be made up of facts, which are conserved... This conservation is an element of all ideas of the physical world... If you have a line of indefinite length, and compare it with another of indefinite length, or you have a line and you bisect it, for example, regardless of the operation, you have not changed the definition of LINE in the least because that is conserved... All the laws of physics are conserved, as in the conservation of mass or momentum...While it is possible to debunk ideas which are really conceptual manifolds in the sense that the Ptolemaic Universe was, the idea of number as a model for reality is conserved...Governments and economy, and even the notion of morality as based upon the virtues are all conceptual manifolds that are conserved, and which people rely on even when they are as hollow as swiss cheece...
Of the moral ideas, the moral forms that make up our senses of good or virtue- such certainty is impossible... Mr. Williams is forever coming up with moral claptrap that only reveals his want of study of the subject...If we take it as given that people have a reason for what they do, and even when they cannot find a good reason, they find a not so good reason; still, people are not without motivation...The wannabee moralist in Williams wants the good of future generations to motivate people today to endure want and sacrifice... Here the the problem, in that people today suffering wide spread want and unhappiness cannot endure more sacrifice no matter what excuse is manufactured...
Groucho Marx asked: Why should I do anything for posterity??? What has posterity ever done for me??? I will deny as a moralist that Mr. Williams is a moralist; but I will deny as a man having read economics that Mr. Williams is an economist...First of all, he sees government as if apart from the economy it spends so much to defend... And then he sees the government as some thing apart from the morality that stands behind all government and all communities, as mere abstraction...No economist worth spit would say that the economy is apart from the people it preys upon or the environment it destroys, but Mr. Williams seems to treat them as apart since he talks of liquidating the assets of the rich as though a petty concern, and talks about taking all the income of those making 66K or less as though it would ever be possible... Where does this Mr. Williams ever address the reality of the problem???...
If it was necessary in relatively good times, and to have wars of choice -to lay a great debt upon the people -what was it really for??? The money had to go some where??? It is being paid to some one... If you took all the money from the rich to pay a debt for the most part owned by them it would be an accounting exercise, and they would be as wealthy after as before... If you take from the poor who pretty much have nothing, then you would see the total crash of the economy and people starving in the street, homeless and hopeless... Looking at the problem scientifically, one should ask: If it were necessary to borrow all that money in good times to keep capitalism flush, how can it possibly be paid back in hard times without tipping capitalism into its grave???

It is not just the government that is broke, but the people, and people around the world, and governments around the world...Debt and taxes are great ways to force people to work, but when markets are saturated because the debts are universally over due, no one needs to work hard, but the over head of government is still there, the wasted of society, the used, abused and huddled masses, and the necessity to defend capital and the consequential misery of capital around the world which is no mean or cheap task for our military...Consider that the government is no only on the verge of defaulting on all it owes to the people in social programs, but that it has long put off the maintainance and replacement of infrastructure on a vast scale while profits were high...
To frame the problem with the good of future generations in mind, which we are supposed to consider, and which government never considered in contracting those debts for us to pay- is nonsense... First of all, the good of the future is meaningless when our own good is out of reach, and the more distant the time we are talking about, past or future, the less meaning it has, and we know it... People can imagine the possible span of their own lives, and even that takes on a glow of unreality the more distant is the time in question...
It is all a moral ploy based upon the notion of good... What would be good, is to recognize that capitalism does not work, and that to feed directly from the veins of the people it must turn government into a device for first contracting debts, and then collecting them from the people who see no benefit from them... If an individual contracts a debt to buy some good that he can choose, even if it turns out to be all promise and no good, then he can be held responsible...
We do not have democracy or democratic control of government... We cannot be held responsible for their debts, unless we allow ourselves to be... It is not a matter of collecting from future generations unless we are too stupid to tell the government to shove that debt up its own os, and tell the rich to suck it up, or see themselves liquidated to pay themselves back... This they will not do...They know that if everything where taken from them along with their money, and was thrown on the market, the market would not bear it, and its price would fall to nothing... A mansion might be had for the price of the guns necessary to defend it; but is that what we want to see???
If Capitalism cannot survive without doing nothing, while doing nothing, only by controlling government and forcing government to bleed the people then the whole thing is a bust, government, business, and the morality that stands behind both...That is your fact...
Capital cannot deliver the goods to people short of debt... No one gets enough in wages to support their needs and must use credit... Government cannot tax the rich or they would fold up, go on strike, and quit being rich... But government can borrow from rich people who will not be taxed... Figure that out...
So that government can survive for a day it puts its survival out of reach for ever... The rich have told the government that the people are loaded with Money and blessed with infinite patience...The rich loaning what they should have paid think that rather than pay taxes that they will recieve taxes; and they should be told the truth...
If paying their taxes would have broken the rich when those expenses were due, paying this debt will break this people now or later... We have run out of time...If we are really concerned with future generations we have got to wrest the government away from the rich, and wrest the commonwealth out of the hands of the rich, and if we have got any sense, we will never allow anyone to get so rich as to think they are above their social obligations to pay taxes for their own defense and for the wast of humanity they create...
Thanks...Sweeney
Comment: #4
Posted by: James A, Sweeney
Tue Dec 4, 2012 5:00 AM
Mr. Sweeney adheres to the 'Global Democracy' movement. He believes we are all severely misled and that the 'rich' should be punished because they've caused all of our problems. He's never quite explained how a tribal form of democracy that he has written about would translate in practice to a country as large as the U.S. He's never quite explained what form the 'punishment' the rich deserve would take or who gets to decide who serves on the 'citizen jury' that gets to punish the rich. As a matter of fact how much money or property constitutes rich? Mr. Sweeney doesn't care for our country's form of government. I would suggest, Mr. Sweeney, that there are many countries in the world. Perhaps you could find one with a government and citizens more to your liking and quit trying to stir up rebellion in this one. Or are you even a citizen? Perhaps just someone fond of causing a little trouble some where?
Comment: #5
Posted by: P. Long
Tue Dec 4, 2012 6:04 AM
P.Long,

Mr. Sweeney has been on this forum longer than any other except the columnist themselves. Maybe you can explain to me and others why he should leave his country. I suggest you leave it, please, so you can grasp that Mr. Sweeney is one of the few Americans willing to stay and fight to make this country better. If he is guilty of anything it is making others realize the extent of their ignorance. You smug, arrogant, no nothing haters, believe nothing posers, are one of the reasons this country is in the mess it is in.

Comment: #6
Posted by: morgan
Tue Dec 4, 2012 7:28 AM
P. Long. Mr. Sweeney is just someone who loves to hear himself talk. He writes 10 paragraphs when a sentence will do. He is obviously a product of a liberal education. Unfortunately the President is using this financial downturn to indoctrinate the young and uninformed on how to envy and vilify the rich.
Comment: #7
Posted by: david
Tue Dec 4, 2012 7:31 AM
Let's see, Morgan. I'm 1.smug, 2. arrogant, 3. 'no' (should be know) nothing, 4. hater, 5. believe nothing, 6. poser. And this in just one short paragraph, yet I'm the hater? Keep spewing your venom. And, by the way, how would leaving the country help me see what a loyal American Sweeney is? Are there some sort of classes I'm required to take about Sweeney before I can leave?
Comment: #8
Posted by: P. Long
Tue Dec 4, 2012 8:31 AM
Don't feed the troll. Arguing with the troll will just result in a 5 page rambling response. Arguing with the troll is the very definition of insanity. It will only give him the attention he craves.
Comment: #9
Posted by:
Tue Dec 4, 2012 10:58 AM
P. Long,
3 should read 'do' nothing. Leaving the country wouldn't help you see what a loyal American Sweeney is. I doubt anything would help you 'see' what a loyal American Sweeney is. No classes necessary, just go. If you don't grasp anything, you'd be gone. See I'm making the same offers to you that you made to Mr. Sweeney. Don't like him stirring up a rebellion in this country, get YOUR sorry ass out of it or STFU.
Comment: #10
Posted by: morgan
Tue Dec 4, 2012 1:05 PM
Sorry. I've got as much right to talk, vilify, comment, and have opinions as anyone else. That includes Morgan and Sweeney. What was it Hamilton said about not arguing with the troll because it only gives him the attention he craves. Boy. What a mouth full that was.
Thanks. P. Long
Comment: #11
Posted by: P. Long
Tue Dec 4, 2012 5:11 PM
I have enjoyed reading Mr Williams' posts over the past year or so, but haven't posted...though I have enjoyed reading most of the comments posted by his other readers. Up until now, I have never read comments as arrogant and self righteous as Sweeny's this time. Unbelievable.
Comment: #12
Posted by: Bill Dorman
Wed Dec 5, 2012 5:05 AM
Sweeney is a troll. Not necessarily “for” anyone but definitely against conservatives and free market policies. He has no credible ideas of his own, he's just against others, wants them to feel inferior and tries to intimidate them into silence. Ignoring him isn't “silence” it is denying him a platform.
Comment: #13
Posted by: Ed Boyle
Wed Dec 5, 2012 9:43 AM
There's a reason Professor Williams authors a socio-politico column: He offers the rest of us his perspective on questions for which we need reasonable and pragmatic answers. Recently on a liberal network news show, the host asked: "What's wrong with asking the rich and wealthy to pay a little more tax?" I submit Professor Williams not only answered what's wrong with that, but also that there's nothing right about giving irresponsible spenders more money to spend.

There's nothing "personal" about the "word fitly spoken" of Professor Williams, for they are not only a meaningful explanation of a turning point, they also pragmatically suggest to those who would understand what history instructs: 1) The "survival of the fittest" philosophy is sure to give way to "survival of the wisest"; 2) People who do best will champion cooperation, not competition; and 3) No person or group can be a winner in isolation, just like no great society has thus far outlived its own success.

We must mention of givers and takers. As each great society has thrived--creativity, interdependence, and mutual support have provided the synergy where the whole has been greater and better than the sum of the parts. Givers--contributors--were in the majority and everyone benefited. Unfortunately, economic disaster almost always begins with a philosophy of "people doing less and wanting more"...and takers become the majority in society. The result is
takers struggle with the givers--the contributors.

Respectfully, there's no need to defend Professor Williams' thoughts and words here. Like the reality of givers and takers, there will always be contrarians who--no matter what is said--will endeavor to tear down rather than contribute. If they are not givers, then they are...?
Comment: #14
Posted by: Rick Martinez
Wed Dec 5, 2012 11:14 AM
If the dire statistics quoted above are accurate then Dr. Williams is correct in stating that we cannot escape our fiscal peril solely by raising taxes on the top two percent of earners.

Moreover, if the dire statistics are accurate we should probably table this discussion and start hoarding canned goods, bottled water and weapons in our basement for the system is circling the drain, there is no escape and we must prepare ourselves for the post-apocalyptic struggle to survive.

Thanks for brightening my day, Doc.

Comment: #15
Posted by: ABarkus
Wed Dec 5, 2012 1:02 PM
The collective comments are stunning in their mob mentality and stupidity. Who and when, at any time said raising taxes on the top 2 percent would 'fix' or 'solve' our debt problems? Certainly not President Obama, nor any of the Democrats. Seems it's another falsehood perpetuated by the stupid. It's amusing and sad watching you all pile on Sweeney. He offers solutions you don't like, yet none of you have anything better to offer. Your frustration and suspected powerlessness has led you to a mob mentality. You are even worse than those you dislike. None of you has a better solution. And unlike the majority of you, Sweeney's assertions and opinions come from an in-depth knowledge of history and provable facts, not opinions based on conjecture or 'made-up' facts. A man willing to stay in his country and fight to make it better is a man to treasure, yet in your cowardice you suggest he shut up or leave the country. I'm sure that would have been your advice to women when they wanted the vote and blacks when they wanted their civil rights.
Comment: #16
Posted by: morgan
Thu Dec 6, 2012 7:19 AM
Re: P. Long... Computers allow me to talk to you, and I don't know or care where you live... They should be able to allow everyone to have a say on every issue that affects them, and for the rest, they can mind their own business... There are democratic limits on government just as there are democratic limits on individual freedom... The licence we allow the rich, to take all they want and piss on the rest is not getting it for this people and never has... There are too many limits put on government in relation to churches and property which leaves business and bushet too great a freedom in our lives; and it is hurting us, and badly... I am not looking for a tyranny of the majority, but certainly when any great nember is injured by business or churches, there ought to be limits... All we need is for people to have a vote on all that affects them, and if it does not affect them, for them to keep silent... If you have no sense of your personal limits, you will not have a government out of such people aware of its limits...Democracies are defensive, and that means that the majority should have some defense against minorities and minorities should have defense against majorities... There is no democratic cure for people wanting to mess in affairs that have no effect on them, but they should be denied the power of government...
Thanks....Sweeney
Comment: #17
Posted by: James A, Sweeney
Sun Dec 9, 2012 7:47 AM
Re: Ed Boyle... I've done my home work, and when you do yours, you can feel superior too... Or just feel superior if you want, and see if I care... Don't think you will win any points with me on a feeling of superiority alone...
Thanks...Sweeney
Comment: #18
Posted by: James A, Sweeney
Sun Dec 9, 2012 7:50 AM
Re: Bill Dorman... The guy says he is an economist without a grasp of the larger picture, and he spouts morality without the least sense of the word... I am right to attack that babboon before he carries off one of our young to make an easy meal of... I know I am right... I have worked hard, and read many books; almost more than I can fit in my house for that knowledge of right... I have worked for this country and my people have fought for it almost from the beginning, and Here I make my stand... We all need to get right and righteous... It is immorality, and that includes the willingness to accept easy answers and easy versions of morality so long as they do not rock our boats that is keeping us all from freedom... You cannot show me the immoral free man, or the moral slave... We need true morality to have true democracy, and it is about time for both... I know enough from many subjects and many authors to not let anyone spell my mind with nonsense because it preserves the status quo...Do you???
Thanks...Sweeney
Comment: #19
Posted by: James A, Sweeney
Sun Dec 9, 2012 7:59 AM
Re: ABarkus... Bullshet... We have more mouths eating more produce, the skinny cows eating the fat; but all the commonwealth that was supposed to support government for and of the people, and the people too, did not just fly off into outer space... Yes; much of our capital has been exported to finance world slavery, and benefit none but a few of us, and we must get it back if we will ever tax it... And you have to remember that it is easier to hide a million dollars than the smallest hole in your shirt...
Much of the wealth taken from this people is hiding in plain sight... Even if you want to keep a multitude of rich people you can increase their taxes, and over time that will balance the budget... Nothing will help our situation like taxing the rich because they control the government, directly and indirectly, and only if they realize that the cost will ultimately be born by them -since the working people can bear no more, will they act responsibly in regard to government, and not push it into insupportable and unwinable wars in every distant land...
If the poor people of this place seem to be taking over it is purely out of necessity since they can be no poorer without starving, and because this place is being ruined, and not by the powerless who more keenly feel their suffering than the rich- who wish the poor to have all the responsibility -but none of the power...The rich are behind your bunker mentality... The real fear is that together we will look for and find some common ground and make a true nation of it... Divide et Empera worked for the Romans... Do not think it works less well for our rich...
Thanks...Sweeney
Comment: #20
Posted by: James A, Sweeney
Sun Dec 9, 2012 10:44 AM
"If you are not willing to tax the wealth of the wealthy as this country once did, you can forget getting wealth out of those made poor to make the rich rich"

Exactly how did the rich extract wealth from the poor? Was it by offering them jobs that they readily accepted? Or was it by force? The former is more moral than an income tax which is taken by force. And note that money flows from the employer to the employee, while the employer benefits from the employee's work.

You've ignored an important fact. The more power the government has to pick winners and losers in commerce, the more power the rich will have relative to the rest of us. Solyndra and Abound Solar are good examples of how billionaires use government taxation (taken by force) to fatten their wallets.

If you want to end the rich stealing from us, then you need to reduce government power over commerce and its ability to pick winners/losers via legislation/regulation. And note that our politicians make quite profitable trades in the stock market based on their inside information regarding their legislation/regulation. It's a simple scam: short a stock/industry before you announce legislation that will negatively/positively affect their bottom line (environmental regulations, prohibitions on selling certain products, restrictions on competition, tax credits, tax increases/decreases, etc.), then sell for a nice profit.
Comment: #21
Posted by: MoreFreedom
Fri Jan 4, 2013 9:32 AM
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