Monday, April 30, 2007

The Undertow of Over Taxation 

Today I had lunch with a friend whose other friend, whom I'll call Bill, stopped by our table. Bill had a small business in a St. Paul suburb. Over the years he'd hired and paid between 5-10 workers annually. The business was his life. His dream was to sell it and retire on his life's work. He sold it just fine. But then the government stepped in: MN took 12% in taxes, the Federal Government took another 40%. Why should anyone, anyone, work for 40+ years to give the government over 50% of a life time's efforts?

Second blow - he also owns property in downtown St. Paul. For years, no one paid any attention to him. Now, seems like the city wants the property. "We never knew this building was here," commented the inspector. Duh - do you read tax records, property records? They didn't tell him why, just that the city was interested in his property. He won't make any money on this sale for sure.

Third example. Though a small business, he's required to place a sign on the door that says "door shall remain unlocked during business hours" and another displaying his right to be where he is. Well, these were missing - sloppy, yes! Over $600 in fines, NO. But then, a bureaucrat must keep busy.

So why are these three, small examples important? See, the owner, the one who took all the risk, the one who worked for over 40 years to provide for himself, his family, his retirement, the one who provided jobs for others, paid all his taxes, etc. ends up getting used by the government. Not only did the government take a huge chunk of his hard-earned money, but the jobs he provided will be gone. MN got their pound of flesh and then some. But they won't get any more.Why? He's moving to a lower tax state and taking jobs and money with him. He's also taking his work ethic and entrepreneurship and ideas and enthusiasm and energy, etc. with him.

Try to explain the fallacy of "taxing the rich" to an anti-business, socialist minded legislator.