I will be digressing from my usual hopefully non-political blog to talk about AMT. There’s a been a bit of a discussion on CNN Money Generation Risk blog about the matter. The actual article/blog entry itself is not all that interesting. I’m more fascinated by comments. They run the gamut, and from I can tell I’m clearly left of the political spectrum for people who take interest in this matter.

Nobody likes taxes, but they are a necessary evil. What I glean from the comments is that most of the well to do don’t feel like they should be paying more in taxes. But why should the rich pay more in taxes? Other than a sense of egaltariasm why should the rich pay more? The rich should if they want to stay rich. I’ll try not to sound like a communist, but I will. Ultimately if the working class feels like they are being exploited it is in their power to rebel against the rich who are outnumbered. Ideally the rich should be happy to pay more because they feel like the taxes they pay serve to better the lives of other around them. However even if they don’t have that desire, I think it’s important to keep in mind it’s taxes that support the Government and the rule of a law that keeps them rich. A wealthy person may believe they have earned their money, and deserve to keep it, but the rule of law is what really allows them keep their money aside from a personal army. I do believe personal armies would be more expensive than whatever taxes the wealthy may pay. The example may be extreme, but I urge the wealthy to understand that they do not operate in a vacuum. If the nation were to destabilize either through internal forces or external ones, the lives of the poor would change, but not so much. It is the wealthy who would most likely suffer the greatest consequences. Therefore it’s justified that the wealthy pay the most to protect their way of life.

The argument for lower taxes in general is a more credible one. I don’t believe that the Government is the best entity for dishing out solutions. It’s inefficient and the exact opposite of innovative. However, if we’re making tax cuts we should start by benefiting the poorer end of the spectrum rather than the wealthy. Obviously any across the board tax cut will always benefit the rich as an absolute number they pay much more in taxes. There’s no reason that a tax cut should cut the percentage of total taxes that richest of all American’s Pay.  Taxes in 2001 could’ve easily been cut where all American’s benefited equally.  It wasn’t like the richest American’s were leaving the country to dodge the taxes.  So if we want to get rid of the AMT, maybe the rich need to start paying their fair share.  And we certainly don’t need to get rid of the estate tax. Like William Gate’s Sr, I’m a big fan of the estate tax.  I don’t see any reason why we shouldn’t shave a few ounces off the silver spoon.

I want to end with a defense of the rich. The “liberal populist left” is often willing to assign blame and derision to the rich. There is nothing wrong with being wealthy, and there is certainly nothing from wanting and achieving financial success. Most people want to be financially successful. One shouldn’t be ashamed or feel guilt for success. A little guilt for not giving back to society is on the other hand healthy. Success should always be encouraged. Too many confuse success with the display of success. I think ostentatious and frivolous displays of wealth should be critiqued. Waste is waste no matter how rich you are. However, earning money in itself is good thing and worth praise. Taxes should not be intended as punishment for money making success. Nor are taxes justified because they can afford it. Taxes are justified because they protect our way of life. In the next couple years, the Government will have to do something about taxes and spending (hopefully both), and getting rid of social security is not that solution (as much some would like that). Not everyone will be able to get what they want, but sometimes those who already have most of the toys that want already (i.e. high net worth individuals) will have to give something up.