The incessant wailing from Obama and the Democrats about “fairness” and “fair share” and Obama’s assault on the business community share a common genesis. These rhetorical and real threats (as in the Senate Democrat’s caterwauling over the renewal of the Bush tax cuts) are far less about actual fairness and more about an empty checkbook and a maxed out national credit card. The debate is actually about the lack of federal revenue to spend on even more social engineering and cronyism efforts in support of activities rooted in corporatist and Marxist philosophies.

According to Obama and the Democrats, our problem is that we just don’t tax enough and “the rich” owe the government more for their success…really?

As Veronique de Rugy points out, we already have the most progressive tax system in the world, one far more progressive than any system in Europe:

Contrary to common belief, the American tax system is more progressive than those of most industrialized democracies. A 2008 report by the Organization for Economic Cooperation and Development (OECD), titled “Growing Unequal,” gave two different estimates of the progressivity of tax systems in 24 industrialized countries. One ranking found that the U.S. has the most progressive tax structure; in the other Ireland beat America by a nose. France, which has a notoriously generous welfare state, ranked 10th out of 24 in both of the OECD progressivity indexes.

There is no question that “the rich” do bear the largest burden for income taxes:

The argument that “progressives” will make is that even if the people are exempt from federal income tax, they still pay sales, property and payroll taxes – and they do. These include Social Security and Medicare taxes imposed on both employers and employees, at a combined rate of 15.3% (13.3% for 2011) – Social Security tax applies only to the first $106,800 of wages in 2009 through 2011. Employers also must withhold income taxes on wages. Unemployment taxes and other certain other levies also apply.

Guess what? The “rich” aren’t exempt from these taxes either, they pay them, too.

We also have the highest corporate tax rate in the world:

On Sunday, April 1, Japan lowered its corporate tax rate, leaving the United States with the highest effective rate among developed countries: 39.2 percent.

In reality, corporations do not pay taxes, they only collect them. Businesses look upon taxes as a cost of doing business and price them in. Every time you buy a product or service that a business produces, you are paying a share of their taxes. Corporate tax policies only exist as 1) a method to collect more tax from individuals by using businesses as tax collectors and 2) a coercive mechanism for the government to use to control the behavior of businesses and corporations through tax breaks, incentives and penalties. If there were no corporate taxes, the government would have less leverage and influence over a business.

Tax, tax, tax, and more taxes.

So, what is the issue?

Let’s look a simple model. Let’s say that you have 10 people in a group and you want that group to spend $10,000 on a group trip…and you get your ticket paid if you get the group to sign on. You are planning the trip so that each person pays $1,000 to go because that is the price of each ticket. You are then approached by 5 of those people who tell you that they don’t make as much as the other 5, so they don’t think it is fair that they have to pay full price. You agree and tell the top 5 people that they have to pay half of the bottom 5’s tickets to be “fair”, so after they agree, they each are assessed another $500 per ticket to subsidize the bottom 5, so now the top 5 are paying $1500 a ticket and the bottom are paying $500 a ticket.

You go ahead and book the trip and sign a contract for $10,000 that states this is a group ticket and either all go or none go and you lose your free ride…and you must collect the individual contributions and deliver a single check in 3 weeks for the full amount.

Two weeks after you sign the contract, 2 of the bottom 5 and one of the top 5 lose their jobs or businesses and can’t pay at all. Now you are $2500 short. Remember, if you don’t pay the full amount, nobody goes…and you really want to go for free. So what do you do?

If you are a “progressive”, you go to the remaining top 4 people and immediately assess them an extra $625 each – because it isn’t “fair” for the 3 that can’t pay to stay home because they want to go really, really bad…and oh, by the way, if those 3 don’t go, nobody goes ( and you don’t get your free ticket). So you use a little appeal to “fairness” with a side order of coercion.  You also tell the people who are now expected to foot the bill that if they don’t cough up the extra dough, they are just are selfish and heartless…that they might be Republicans only interested in depriving others!

The final tally looks like this:

• 3 people pay nothing
• 3 people pay $500 each
• 4 people pay $2833.33 each

“Fairness” and “fair share” in this situation was not driven by equality. It was driven by the desire to spend $10,000 to go on the trip. The motivation was to reach a number in any method necessary so that the desired action could continue. In this case it was a trip, in the case of government it is to keep spending on entrenched entitlements and new programs.

That is the case with the debate today. The problem for statists is not that our systems aren’t progressive enough; it is that they are not yielding enough revenue to continue the spending desires of our government and our political class. The declining economy has led to fewer taxpayers, lower salaries and business activity to tax. According to the Bureau of Labor Statistics, the labor participation rate has dropped to the lowest level in 10 years as people drop out of the workforce.

Less people working = less taxes paid = less revenue in government coffers.

Combine this formula with the statist belief that government spending has primacy over everything and it can never be cut (or reduced) and we find ourselves in a debate over “fairness” in the most skewed tax system in the the industrialized world.

Obama and the other “progressives” share a common ideological progenitor – the prolific bank robber from the 30’s, 40’s, and 50’s – Willie Sutton. In a biography, Sutton is recorded as bing asked why he focused on robbing so many banks over his 40 year criminal career. Legend has it that his somewhat sardonic reply was:

Because that is where the money is.

He didn’t say “duh” or “that is where the money is, dumbass” but that is implied…

This is why you hear so much about “paying their fair share” in conjunction with rhetoric about corporations and “the rich” and it isn’t about “fair share”.

That’s where the money is.

It is that these classes in America still have money and the “progressives” in government want it…more than want it – they think that it is a debt for them to collect, a sum that is owed to them.

The current mantra repeated by Obama isn’t being repeated because the systems for taxation in America are unfair. It is because he still wants the take the trip and he needs you to pay for it.