Even people with little understanding of public finance should be able to grasp the vital fact that high taxation in every country of the world makes only a minor contribution to Governments' total spending, and that it is therefore clearly an instrument of policy being used to make it impossible for many people to make themselves genuinely independent.
High taxation is one of the most insidious evils undermining the non-Communist world from within. This is made very clear in the following instructive report from America, as published in "The Advertiser", Adelaide, of November 17, on the growing restiveness of American taxpayers under the progressive imposition of higher taxes:
The inevitable finally happened the other day. Taxpayers in New York rose up at an election and booted out a proposal solidly backed by the City Hall for a further drain on their pockets.
The Mayor and his colleagues — except for one notable official who lone-handed aroused the public's resentment into revolt — wanted approval for a $500 million bond issue outside the city's debt limit to finance new school construction.
Its overwhelming rejection is a symptom of something that is sharply apparent across the nation this year, the highest-taxed year in U.S. history.
Burdened with Federal and State taxes, and then more taxes on almost every retail item they buy, angry taxpayers are groaning that incentive is disappearing and that making ends meet is almost impossible.
Legislators and civic officials are facing mounting criticism for over-spending.
Congressmen are finding that protests from constituents are growing louder every time another massive foreign aid vote is taken.
More than 10 years of the working life of the average U.S. taxpayer, says the Commerce Clearing House, is spent just to pay off his various taxes, claiming close to 40 per cent of his income.
Another estimate says that the average earner here spends 2½ hours of every eight-hour working day to satisfy the tax collector.
Even the wealthy, though more able to pay, are under the same yoke. The highest tax bracket goes up to an incredible 98 per cent and when you add State tax to that you get to the somewhat absurd position Australian-born businessman Al Daff found himself in.
Formerly head of Universal-International in Hollywood, Daff was told by his accountant that he could not accept another salary boost or he would be paying more than 100 per cent of his additional income in taxes!
Yet as more and more stirrings of tax revolt appear in various parts of the country, State Governments are in the throes of the biggest revenue search ever undertaken.
If individuals cannot be taxed much further, companies can, and today they are feeling the heavy hand of the collector. Already 52 cents of every corporate dollar is Government property.
Where will this dog chasing-its-tail business all end? In Washington, the Eisenhower Administration has taken the unprecedented step of raising the total debt limit twice in the same year to a phenomenal $288,000 million.
This works out per person in the U. S. to more than $6,250 a year, more than the national average wage of just over $5000.
Most State Governments are today spending more than they are earning — just to keep pace with established services and projects, let alone trying to match a booming population and urban growth.
Local government is in the same boat. One expert calculates that for every dollar earned, State and local governments are spending today $1.10.
One State, Michigan, is already facing bankruptcy, and others are steadily dropping deeper and deeper into deficit.
At the end of World War II only one of the country's 48 States, Massachussetts, was working outside its income. At the end of last year, 2 were working in the red.
States are even borrowing against future tax collections, and up goes their debt interest payments. This year the States have introduced 116 major new tax laws, including 92 increases and 12 new charges.
There is one important thing for Australians in State and local government to remember whenever they protest about the deal they get from Canberra and want to cite U. S. tax systems.
The U. S. has something like a 165,000,000 population start over Australia, it has a free economy that exploded into prosperity unlike anything ever seen years before income tax was a heavy burden, and it has as a corollary an enormous reservoir of private capital.
It is this capital, accumulated in the almost taxless past, that has financed much of America's expansion. Now heavy taxation is damping down productivity, so much, indeed, that the growth in the national product compares infavourably with that of Russia.
The New Times. — January 29, 1960