Monday, July 02, 2007

letter to the editor of the C-J

Dear Editor,

I appreciate the Courier-Journal's focus on the plight of the poor in one of its June 23rd editorials. It's certainly worth wrestling with various market outcomes and the extent to which those are caused by some combination of producer fraud and consumer "stupidity".

That said, it is bizarre to ignore government policies that do far more harm to the poor. The government is quite busy increasing the price of food, clothing and shelter-- in order to help various interest groups. The government insists on operating a monopoly provision of K-12 education for those who cannot afford a choice. Federal payroll taxes impose an especially oppressive burden on the working poor and lower middle classes-- more than $3,000 per year in payoll taxes on those who earn $20,000 and more than $6,000 on those who earn $40,000. A number of states, including Indiana and Kentucky, impose state income taxes on the working poor. Etc., etc.

By any reckoning, the government's "gouging" of the poor is far deeper than anything the market might accomplish. And as the editorialist noted, "What's so maddening is that most of this pocket-picking is legal." Beyond pointing to potential specks in the market's eye, the working poor would be better served if the Courier-Journal would focus its attacks on the government's logs.