Despite mounting government debt and amidst unemployment figures in the top ten in the nation, North Carolina has the highest tax burden in our region of the country. Keep in mind that our opponent has supported every budget to increase debt, taxes, and spending during his 16-year career in Raleigh. And, a person with the mindset that more government is the answer must even look for new taxes such as his proposed vehicle mileage tax. (At least he has been consistent!)
Not long ago, a professor came up with a simple story to help explain our tax system. It is worth reading. Suppose, ten men go out for dinner every evening. The total bill is $100. If they paid their bill the way we pay our taxes, it would go something like this: The first four men (the poorest) would pay nothing. The fifth would pay $1. The sixth would pay $3. The seventh would pay $7. The eighth would pay $12. The ninth would pay $18. The tenth man would pay $59.
One day, the restaurant owner said, “Since you are such good customers, I’m going to reduce the cost of your daily meal by $20.” (He reduced their “tax debt”.) So, now dinner for the ten men cost $80. The group still wanted to pay their bill the way we pay taxes. So, the first four men were unaffected. They would still eat for free. But what about the other six paying customers? How could they divvy up the $20 windfall so that everyone would get his “fair share”?
The six men realized that $20 divided by six is $3.33. But if they subtracted that from everybody’s share, then the fifth and sixth men would each end up being paid to eat their meal. So, the restaurant owner suggested that it would be fair to reduce each man’s bill by roughly the same percentage amount, and he proceeded to work out the amounts each man should pay. And so:
The fifth man, like the first four, now paid nothing (100% savings). The sixth now paid $2 instead of $3 (33% savings). The seventh now paid $5 instead of $7 (28% savings). The eighth now paid $9 instead of $12 (25% savings). The ninth now paid $14 instead of $18 (22% savings). The tenth now paid $49 instead of $59 (16% savings).
Each of the six was better off than before. And the first four continued to eat for free. But once outside the restaurant, the men began to compare their savings. “I got only a dollar out of the $20,” declared the sixth man. He pointed to the tenth man, “but he got $10!” “Yeah, that’s right,” exclaimed the fifth man. “I only saved a dollar, too. It’s unfair that he got ten times more than me!”
“That’s true!” shouted the seventh man. “Why should he get $10 back when I only got $2? The wealthy get all the breaks!” “Wait a minute,” yelled the first four men in unison. “We didn’t get anything at all. The system exploits the poor!” Then the nine men surrounded the tenth and beat him up.
The next night, the tenth man didn’t show up for dinner, so the nine sat down and ate without him. But when it came time to pay the bill, they discovered something important. They didn’t have enough money between them to pay even half the bill!
That is how our tax system works. When big government decides to tax and spend too much, many of the people (and the jobs their businesses create) just might not show up at the table anymore. (NC ‘reported’ unemployment now exceeds 11%!)
No country or state has ever borrowed, taxed and spent itself into prosperity. We are living on a false economy. It’s time to wake up to reality – it’s time for a change.
