Letter: Taxation isn't beer

Aug. 03, 2014 @ 04:20 AM

To the editor:

With respect to Jim Davidson’s amusing story in your July 30 issue on how our tax system works, I was further amused by the manner in which the critical logical flaw in his analogy of the beer tavern was glossed over. One might be justified in presuming that the owner of the tavern, by reducing the cost of the beer he sold to his ten customers, was not going to end up seriously in debt or go out of business as a result. Nor would his customers be overly concerned if such a result was to ensue. Nor would one seriously expect the nine customers who were less benefited by the price reduction to turn on the 10th under the circumstances described.

The difference, in the case of taxation by the government, at least in today’s environment, is that the reduction in cost to the ten beer drinkers via reduced taxation has led to decreased government services in the fields of education, road and bridge repair and maintenance, food subsidies for the needy, etc., etc. It has also led to decreased government spending in general which impacts the purchasing power of the population at large, which in turn impacts the over-all economy and the quality of life for the lower echelon of our ten beer drinkers but not of the wealthier of them. This critical difference between the cost of beer and the level of taxation might explain the level of antagonism described by Mr. Davidson – but only as to taxation, not to beer.

Jim Muir