Wednesday, April 13, 2011

Want to volunteer to cut the debt?

Here is the tally of voluntary contributions made to cut the deficit. So far we are up to about 700 grand. Not bad as a stand alone figure I suppose, but when put against the deficit not terribly encouraging. Round up to a million for a minute. A million is 1/1000th of a billion. A billion is 1/1000 of a trillion. So a million is one millionth of a trillion. The deficit is about 1.6 trillion dollars. So really we are about one half of one millionth of the way there on voluntary contributions alone!

Now, some conservatives say that this is evidence of hypocrisy: if there are so many people that think our taxes should be higher then why aren't there more people making voluntary contributions? And why does the tax system have to be involved at all? Why don't those people that think the government can spend their money better than they can just cut out the IRS middle man and send in their check. But that really isn't fair. I may think that we should all pitch in to buy a new car, but if I pitch in and no one else does all that happens is that I am out some money and no one gains any thing. Such a situation would be strictly irrational.

On the other hand, if I don't make the contribution I may get the good anyway. Under these circumstances, why wouldn't I just keep my money? No one wants to make a contribution and then see no benefit to themselves, let alone one that leads to no benefit at all.

But perhaps that is where the argument breaks down. In the case of the deficit there may be no place where there is a disjoint change in the benefit per dollar? (There is a word for this in economics if I could remember it.) You get the benefit for each dollar contributed. So why don't those of us who feel that the deficit should be closed with higher taxes on people incomes similar to our own? What are we waiting for? Whatever benefit is going to come from my taxes increasing is going to come on the first dollar and it is going to come whether others contribute or not, so why not just start sending in checks?

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