John JJ Richman was making breakfast when he heard the crowd outside. They seemed just shy of hostile. He opened his door to see about 65 townspeople, out of a town of 100. Two spokesmen were standing on the porch.
John: Good morning. Why are you all here?
Rob: There are things that need changing, and you are the one to help us.
John: (distracted by the milling crowd)
Rob: The town could use improvement. Renovating the school, hiring more police, fixing up the football field, and a summer splash fountain for the children. For the little children! (Rob is shaking a bit)
John: Well, if you put it like that, I can contribute $1000. (He scans the crowd) Make that $2000.
Rob: Not enough. We want you to pay for it all, along with the other 4 rich guys in town. You are single, earning $250,000, and paying $80,000 in tax. We think $105,000 in tax is only fair, (his eyes flash) or maybe a bit more. That leaves you with $145,000, which is more than fair. You live in the town and will benefit from the improvements.
John: That's a big bite. Why should just 5 out of the 100 fund the whole town? That $80,000 is 32% of my earnings; isn't that enough? Maybe the whole town should contribute.
Rob: We contribute what we can. We have less money than you. Some of us work for you, and you don't pay enough. We should all be more equal. You have the money and we need it.
John: I already personally pay 20% of the town's expenses. The 5 rich guys in town together pay 60%. The 25 well off families pay 86%. Isn't that enough?
Rob: We are not into philosophy. We want money. You have money.
John: Well, I don't agree with you. Where do you get the authority to just take what you want from me?
Rob: I'm the mayor, and at my election two years ago a referendum passed by 65 to 35 about fixing potholes. I think you argued at the time that there was already enough money to fix them. It seems you were always stingy.
In that referendum, Section 3, Paragraph 2.a says: "The town shall have the authority to levy taxes to an aggregate amount strictly limited to a total of $20,000 to fix the potholes in the town's streets and thoroughfares (note 1)."
Note 1 says: "And in emergencies, for things other than potholes, and possibly a bit more".
(The crowd laughs and slaps each other on the back)
John: This is unfair. You want me to pay more without paying anything more yourself.
Rob: Actually, we are lowering our own taxes. We deserve it, and you don't. We don't understand how you get your money. Some sort of luck or black magic. It probably should be ours. Somehow you took it when we weren't looking. We are leaving you more than enough. You should be happy.
John: I don't have the extra money on me.
Rob: We'll bill you. We are not barbarians.
(The crowd looks disappointed)
John: It seems I can't do anything about this. You understand that I won't be expanding my business within the town. I'm feeling a bit upset. I may go fishing.
Rob: Fishing is good. We'll see you there.
We may be back in a month about money for another Stimulus Package. We want to improve the town economy by giving each of us 65 a stimulus check of $1000. Those new TV's look sweet.
John: Is that all?
Rob: (Turns toward the crowd without answering) OK boys, next stop is 13 Orchard Lane, there is more work to do.
- -
2008 Federal Taxes
Income and Social Security/Medical taxes on $250,000.
$40,052 Income Tax on $164,550 $31,499 Income Tax 33% x ($250,000 - $164,550) $ 6,324 OASDI 6.2% x $102,000 $ 3,625 Medicare 1.45% x $250,000 ------- $81,500 32.6% of $250,000
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And now - The Rest Of The Story:
Within the year Richman, the 4 other rich guys and most of the other 25 well off families in town had put their homes up for sale and moved to other towns. They outsourced much of their manufacturing to Mexico and the far east and moved the remainder or their plants and other business interests to other towns with more reasonable tax structures.
The taxes no longer paid by these people were shifted to the remaining well off families who are now in the process of leaving town.
The extra police have been laid off along with half of the original force. The money for the football field was spent on new sod but the field is now overgrown because there is no money to repair the broken lawn mower.
The splash fountain for the children was started but there isn't any money to complete it so it remains a muddy eyesore.
The streets and public buildings are in poor repair but there is no money to fix them.
The mayor is running for re-election on promises to increase tax revenues by raising the tax rate on the campgrounds and antique stores that bring tourists to the town, as well as the hotels, restaurants and other businesses that cater to them.
BONESHAKER
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