Tax Withholding Is Bad for Democracy, by Charles MurrayAEI’s Charles Murray argues that the incidence (and relative burden) of both income taxes (e.g., the top 1% of American households pay more in federal income taxes than the bottom 95% combined) and payroll taxes (the social security portion of which is regressive) is obscured by withholding at the workplace. He argues that ending withholding and replacing it with quarterly payments of estimated taxes would be good for democracy by promoting a common understanding that we all pay a share of the costs of government.
While the statement “we already ration health care; we just let the market do the rationing” is certainly true, it doesn’t logically support rationing by government fiat. Ms. McArdle notes that the same (self-evident) statement can be made about virtually any other good; e.g., “We already ration food; we just let the market do the rationing”, or “We already ration gasoline; we just let the market do the rationing”, or “We already ration cigarettes; we just let the market do the rationing.” Duh!
As the author notes, “It’s remarkable that in the current debate over how to control health care costs so little attention is being given to the important results of our 10-year experiment with consumer driven health plans.”