Thursday, June 07, 2007

Michael Novak on Taxes and the Economy

Writing in First Things, Michael Novak summarizes some pedestrian statistics of which everyone should be aware, concluding that things aren't as bad as they look for those at the bottom of the economic heap.


In April 2007, the IRS received more tax dollars than in any month in its prior history. The new tax policies of the last few years are soaking the rich heavier than they have ever been soaked before. The rich are paying a larger percentage of the income tax than ever before (85 percent in 2004, compared to 65 percent in 1979). They are also paying higher amounts of raw dollars each year—but they have not been complaining.
It seems to me that an economic system that works like this is far better than any prior economic system in history, whether landowning, agricultural, traditional, or early industrial—let alone the Mickey Mouse socialist systems of Eastern Europe and China. Whatever its faults, the American economy has proved itself capable of absorbing about ten million new immigrants every decade, nearly all of them poor, and helping them to rise out of poverty by themselves within ten years.

In fact, close study shows that if any American does the following three things—works even at a minimum wage all year round, stays married (even if not on the first try), and finishes high school—his or her chances of being poor are only 7 percent. He or she has a 93 percent chance of moving out of poverty fairly quickly. The vast majority of individuals at the bottom sure keep doing that, decade by decade. The actual population at the bottom keeps changing and churning.

His upbeat take on the overall state of the economy provides great comfort to financially secure, well-fed readers with well-ordered lives. Or, stated differently, if you are among those paying more than their "fair share" of taxes, you may be excused from fretting about the problems of the great unwashed already taking from more than they contribute to the economic pie.

He's right, of course. And the anti-capitalist rhetoric of the Old Left seems increasingly hollow with the upward and onward drumbeat of global business. One of last night's hits took me to the memory of Arthur Schlessinger with his old-fashioned anti-Communist views and Novak's essay reads like an echo of Schlesinger's critics.


He exemplified the insouciance of Lionel Trilling, who dismissed conservatism as irritable gestures trying to pass themselves off as ideas.

It's hard to recover from such a well-aimed barb, especially when it hits the bulls eye. But the fact is that without habitual introspection even the most pious of Christians can lapse into a habit of smug confidence that so easily captures the intellect of their most articulate critics. I am thinking here of Christopher Hitchens, the most articulate atheist alive today, and his condescending, mean-spirited denunciation of people of faith. No matter how tempting it may be to imagine that we are living in the most beneficial and uplifting of times, having left in the last century the evil half of Dickens' vision

It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to heaven, we were all going direct the other way - in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only.

I'm sorry to report that we still have problems of the "worst of times" and there is no excuse for ignoring them.

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