The lottery test

As we receive brightly colored postcards disclosing tax increases, and ponder ballot initiatives, it occurred to me that some back-to-basics thought about the nature of taxation might be in order. I have found that one way to tackle the subject is with an easy thought exercise that I call “the lottery test.”

We begin by asking a simple question. What would you do if you had a big windfall? What if you won one of those big mega-million lottery jackpots? Let’s assume that your needs will be taken care of into perpetuity, and family and friends will be pretty happy too. You have set things up so that even your grandchildren won’t have to worry about college, but you still have just a bit more money than you feel like you need to spend. Let’s just call it a million dollars. What would you want to do with your disposable million?

I can tell you without hesitation that if I were ever to experience such a windfall, it would be a very good day for the McCook Humane Society and St. Patrick’s School. Those would be my initial choices. In doing so, I would be giving back to organizations that have given much to me, and help ensure that they will continue to be valued entities in our community. What would be your choices? What organizations would you most like to support? Your church? Public radio? Veterans? Conservation? Pheasants Forever? Habitat for Humanity?

Now, let’s take a look at your list. Do any of your dreams for your million dollars include a new swimming pool or a baseball complex? How about additional funding for the public schools? There’s nothing wrong with those projects, and I’m certainly not recommending that you vote against the upcoming ballot initiatives (at least not yet). I just think that as we read about the “needs” of our local institutions, we should think about more than our personal budgets. We need to ask ourselves if the money is better collected and dispersed by government or left to our own discretion.

In my view, that’s the problem with taxation. It’s not the amount of money that the government takes that worries me. The real crime is how they spend it. There are groups of people who think they can spend my money better than I can, and I strongly disagree. The evils of taxation are as simple as that, right? Well, not really.

We live in one of the safer parts of a relatively safe country. I enjoy having a city government, a police force, trash removal and treated water. I also enjoy living in a country that supports Ukraine, Taiwan and Israel, and I think our Interstate Highway System is every bit as grand as the Great Wall of China. How much of your million dollars would go toward that?

And then there are the poor folks. People lose jobs, they have disabilities, they have huge medical bills or sometimes, they are just caught in a vicious cycle of poverty. Make no mistake. Income disparity is real. It’s no longer just a trope muttered by would-be socialists. Any serious economist will tell you that the income bell curve is getting wider, and the people at the south end of that equation are having a tough time.

People of a more socialistic mindset see disparity and find it unfair. Why should people have so much when others have so little? Why can’t they just share? At the same time, it’s perfectly natural for people with capitalist leanings to be more tolerant of increased disparity. Capitalists know that the folks at the top are the ones who make the investments that spawn innovation and create jobs for everyone.

So who is correct? Well, they both make good arguments and are sincere in their beliefs, so each side nominates a slate of representatives to represent those given philosophies. That seems fair enough, but there’s a catch. The people we send to represent us have their favorite causes too, and our pools and animal shelters may not be high on their list of priorities. They also have the occasional unemployed brother-in-law who needs a job, and they often need to cut back-room deals with other legislators just to get things done.

How much of my Humane Society money should go to my representative’s brother-in-law? How much of your million dollars goes to the construction of a bridge that you will never see or cross? I suppose I could launch into a diatribe about how our Federal Government has grown far larger than the founding fathers would have liked and the evils of fiat currency, but those are almost too obvious for thoughtful discussion.

The question then becomes, “Where do we draw the line?” How do we balance our local interests with the common benefit of the country as a whole? The good news is that ballot initiatives and brightly colored postcards are actually a sign of good civic health. Unlike the show that unfolds on the evening news and in the halls of Congress, our “say” on ballot questions is direct, rather than indirect.

As for the local issues, the bunch of folks behind the pool project are bright, energetic and engaged. They care about the community and are planning proactively for its future. I am not inclined to vote against those people. On the other hand, the tacking on of the additional sports complex might be a bit of a poison pill for me. I am looking forward to reading the news and my mail over the next month to see more detail about how those projects and ballet questions are structured.

As for the schools, I have always thought that the best commentary on the quality of our local schools is that people here actually send kids to private schools for the religion. That is far from being the case in urban and suburban communities where the public has lost faith in the school systems. Anyone who can afford private education for their children simply does so without regard to religion. Can our schools be better? Absolutely, but the question is whether or not they should get a raise that results in, according to my pink card, about a 6½% increase.

The bottom line is this: the ability to choose how and why the government picks our pockets is a good problem to have. Many on our planet do not enjoy that privilege. We won’t always agree on the details of our own taxation, and that’s good too. Lively discussion and a moderate degree of friction always benefit the process, and I am looking forward to the many discussions that will unfold over the next six weeks.