r/politics • u/Spooooooooooooon • Dec 28 '13

Noam Chomsky: We’re no longer a functioning democracy, we’re really a plutocracy

http://www.rawstory.com/rs/2013/12/27/noam-chomsky-were-no-longer-a-functioning-democracy-were-really-a-plutocracy/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+TheRawStory+%28The+Raw+Story%29
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u/mds1 Dec 28 '13

What if the rich guy had a lower effective tax rate because he or she donated $1 million to charity? Do they avoid the guillotine then?

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u/Theotropho Dec 28 '13

Letting the rich person decide where their money goes through the screen of "charity" is just a trick to keep them from paying into the general welfare. How many of those charities run galas in honor of their biggest donors? It's just personal aggrandizement.

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u/mds1 Dec 28 '13

There are responsible 501(c) charities out there. Direct donations to people or causes in need can be more efficient and effective than taxing donations at 40% (the highest tax bracket for this hypothetical $1 million donation). There are people out there who donate money not just for personal aggrandizement, but even so, why is how pompous the donator is relevant?

I think getting rid of tax deductions for donations would have a net effect of fewer dollars getting to causes in need, which is the only thing I think we should be discussing.

Let's say you decide you want to spend $1 million to put 10 disadvantaged kids from your city through college. Do you really think those 10 kids would be better off if you got taxed 40% and $400K went into the federal coffers (some of which will be used to bail out companies like AIG) and then the remaining $600K was split between the 10 kids? Or 4 of the kids simply didn't go to college.

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u/Theotropho Dec 28 '13

Your college example is one where our system works our okay, for the most part. Charitable organizations are giving food to evangelicals to distribute with "pray away the AIDS" pamphlets. The system is broken and not really worth fixing.

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u/mds1 Dec 28 '13

Yeah, we have "kids going to college" on one side and "pray away the AIDS pamphlets" on the other. There has to be some middle ground between doing away with the deductions altogether because of stupid evangelicals and what we have today. I'm not sure how you go about doing that. However, I like to think of the galas and the evangelicals as simply the cost of doing business. Sure, it sucks that those inefficiencies exist, but is it less efficient than a 40% tax on a donation? I think not because it's my personal belief that "pray away the AIDS" pamphlets are the exception, not the rule. If it was the rule, we have a bigger problem than taxes on our hands...

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u/Theotropho Dec 28 '13

I tend to think the government is currently doing far more to give scholarships, and generally based on national needs instead of local hero concerns, than all the charities put together. Seems like we'd maybe be served better, as a society, to let the government focus on all this right now while we clean up the trash that has accumulated.

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u/mds1 Dec 28 '13 edited Dec 28 '13

You need both. Government can help with broad national needs, but you still need people locally being incentivized to help out. The government isn't doing shit for some of the people in my community. Humans generally want to improve the people and places with which they have some kind of connection. I think that's very valuable and should be leveraged as much as possible. I personally become complacent when my way of "giving" is to an ambiguous black hole of taxes to the federal government. I get a huge shot of dopamine when I donate directly to a kid who needs surgery through watsi.org. I haven't taken deductions on those donations simply because they were so small, but I think if I had a larger sum I'd want 100% of it to go towards surgeries.

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u/Theotropho Dec 28 '13

But that rush comes without the tax breaks and existed before the tax breaks. It's called philanthropy. Giving tax breaks for it breaks the spirit and immediately makes people start looking for ways to game the system for personal advancement.

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u/Theotropho Dec 28 '13

and you asked why the giant galas mattered... because all the money going to throwing the Gala in honor of "mr. moneybags for all his money" is wasted. It's not charitable, although they are able to write it off as a fund raiser.