On this tax day, I think this opinion from the Wall Street Journal is excellent. It appears that Mr. Donohue is a 2 or 3 years older than I am but, other than that, his life and mine are very similar. Not surprisingly, so are our opinions.
I would add that there is another huge tax that I am paying that many people that are poor do not pay. My oldest son is in college. Because I work very hard and make a very nice income, I pay list price for college education. My son is not eligible for financial aid simply because his old man works too hard. Luckily, he understands the value of hard work as well and has earned some merit based grants based on his academic credentials. He also works at part-time jobs to help pay the way. Anything in excess of that, Dad pays for.
I wouldn’t complain about the costs of sending my son to college except that the system is not totally fair. I am very familiar with another family with kids that are slightly older than mine. In their case, the father has had little success in building a career and essentially earns a buck or two over minimum wage. The mother doesn’t like to work, and even though she is a trained nurse she only works 15 hours a week – not because she can’t find work but rather she doesn’t want to work that many hours (she says standing too long makes her feet sore). Together, they sired 6 kids (obviously they knew how to work at something). As those kids grew up, food stamps were regularly available to them and they ate a free school lunch. The kids are smart and when they finish high school they have all gone to college – the most any have had to pay is ten grand for 4 years at a very good private college. Most of the others paid nothing except for incidentals. One studied overseas for a year for free.
All of these kids received government secured student loans. These are capped at a certain amount per year.
I am happy that these 6 kids are devoted to their future enough that they have gone to college. They appear to be starting their lives in good jobs and I am happy for them and wish them well. However, as I write checks for college for my son, I am jealous of their lazy parents – they don’t work hard and their kids are not penalized for that. I work hard and am penalized.
It just doesn’t seem fair and I am fed up.
By MIKE DONAHUE
I’m in the 32% federal and 10% state income tax brackets. I pay a 1.2% property tax on very expensive California real estate. I am subject to the Alternative Minimum Tax. I am self-employed and subject to a 15% payroll tax on the first $100,000 in income and an 8.75% state sales tax. If I have a gain from investing, I pay a minimum of 15% federal and 10% state tax but can only write off $3,000 per year if I lose.
And now the government wants me to pay more?
As a child I mowed lawns, shoveled snow, had a paper route, sold sandwiches at school, and cut up dead trees and split them for firewood to sell during spring break. I have worked every summer since I turned 14. I took out student loans for college and worked 35 hours a week, at night, to pay for the rest.
Since I graduated in 1983, I have been in straight commission sales and have had many 60- to 70-hour work weeks. No secure salary, no big promotions, no pension—just me profiting though helping others while being subject to the swings of the economic cycle. The first 20 years were tough, but it’s finally starting to pay off.
I drive a nicer car (bought used), live in a better neighborhood, have more retirement savings than many. But I am certainly not rich, and every month I find my ever increasing bills (and taxes) tend to match my income. I have more than most only because I’ve worked harder than most and because I am a saver. It was not easy.
Why then does the government feel so entitled to take my money and give it to others? Why should I have to carry so many people on my back? Call me cruel. I don’t care. I give to whom I choose—but since so much is confiscated (and wasted in the process) I have little left I wish to give.
During the 1990 recession I could have qualified for state and federal assistance, but my wife and I managed to get by as she worked nights while we juggled our infant daughter between us. It was hard. However, it never occurred to us to take from others to subsidize our shortage. It’s not our way.
Life is hard. You learn when you fail and you make changes when things hurt. Why then is the liberal agenda trying to make sure nobody feels any pain? And why does the government feel so entitled to steal from many in order to give it to others. What has happened to personal responsibility and accountability?
My patience and pocketbook are reaching the breaking point. I am not for equal outcomes regardless of effort. I’m tired of being the mule. Maybe I will quit and live on the dole for awhile. I probably even have enough health issues to join the one in seven adults categorized as disabled. I’ve been poor and I’m not afraid to go back.
Remember it was social mobility that made America great—the ability to earn and get ahead. If Congress continues to buy votes at the expense of social mobility we will no longer be a great nation. The truly rich will stay that way but many “Henrys” (high earners, not rich yet) like me will quit. We may be only a small percentage of the population but we pay a large portion of the taxes and employ many. If you take the incentives away you will lose Henrys.
Mr. Donahue is a financial adviser in La Jolla, California.