Tax Policy as Explained by DuckTales

 

It should be no surprise that in this presidential election we yet again hear nothing but nonsense regarding tax policy from those seeking office. Among the many principles being ignored are:

• You cannot tax wealth more than once--if you can even tax it the one time given tax avoidance and evasion opportunities and incentives.
• You cannot lower taxes and increase government spending--government spending is taxation (today through taxes or tomorrow through debt).
• You cannot tax without discouraging that which you tax--there is no tax free lunch.
• You cannot tax income--it may look like you are taxing income, but you are actually taxing consumption. On this point we have DuckTales and the hero Scrooge McDuck as the perfect illustration.

If you try to tax Scrooge McDuck, you will be unsuccessful. He is tax proof. You are ultimately taxing Huey, Dewey, and Louie, and they are not being taxed correctly in this scheme. You are taxing the wealth creator dissuading him from creating more wealth and at the same time not discouraging the wealth/resource destroyers.

Uncle Scrooge McDuck is the "wealthiest duck in the world". Hence, he is an obvious foil for those who despair at the thought of billionaires. But Scrooge McDuck should be considered a saint to those who truly wish the best for all the other ducks of the world. For he is the ultimate giver. 

He creates vast wealth through his many businesses, but he uses very little of it. In fact his number one entertainment is simply swimming through his money and treasure which he keeps in a giant money bin. So in exchange for creating wealth he takes basically only money (claims on resources) rather than resources himself. Outside of funding his adventures for more wealth, he lives a quite miserly life. Say what you will about that choice, it is consequentially a very good one for the rest of the ducks in his world. 

Who really pays taxes? 

Taxes are a method of the financing of government uses of resources. In order for a tax to be paid, it must be the case that someone, somewhere, sometime not use a resource so that government can use that resource. Therefore, the payer of a tax is ultimately the entity that must forego the use of a resource. It is decidedly not the creator of the resource, per se. 

Who should we want to pay taxes? What should we tax and why should we tax it? 

I always argue we should tax resource use rather than resource creation and do so as efficiently as possible. We should tax if the use of the taxed resource is better and necessarily done through government rather than private entities. If that seems like a high hurdle, it's because it is.

Attempts to tax Scrooge McDuck are bad faith and poor logic.