Let’s say Dad is the breadwinner in the family, Mom is the homemaker and the children are the students working their way through school. Like most families, they have a budget, a plan to use their money wisely. Robert Burns cautioned us about the best laid plans of mice and men, and probably when he was recovering from a budget gone awry.
Dad brings home a paycheck with which the family buys and saves. Mom will pay out as little as she can in shopping for groceries, clothes and all the necessities and luxuries of family life. They have little choice but to live in debt since few people can afford to pay cash for a house or car. They have to borrow. Nothing disgraceful about mortgaging when it is in a family’s price range, and better when the interest rate of the loan is low, as it is now for several years. They try not to pay attention to the mathematics by which they end up paying two and a half times for the home or car. But they had to have a home and transportation long before they had the cash in hand. Living under an overpass has little appeal. That’s the justification for the interest they pay on the mortgages, the price for using the bank’s money for immediate needs.
Now let’s say that the cost of sensible living has gone up a notch. Let’s also say that as the children grow, they need/want more expensive things. Dad is still bringing in the same paycheck with no cost of living increase. Mom’s resourcefulness of belt-tightening puts the family on a slightly more economical diet. The change is so subtle that no one notices. If this is an old-fashioned family, maybe the kids kick in some of their summer income as a sort of reverse allowance. They are motivated by the parents’ helping them to see that they too can advance the family project. After all, some of that budgeted savings all along has been for their college off in the future.
With the squeeze on, the family has to start making choices. It can examine its many purchases to see where cuts can be made. Since the many purchases have all different importance, the more frivolous get the axe first. Of course, what is frivolous to the parents may not be to the children. That $150 pair of athletic shoes — we used to call them sneaks — and the brand-name bragging rights they bring are seen as valuable to the youngsters but not to the management team. Tension ensues, but cuts are made.
On the other side of the ledger are the receipts. Dad has not gotten a raise in years. If he could get one, it would ease the strain. Life could go back to normal. But in a remarkable burst of family illogic, one or more family members argue against Dad asking for a reasonable raise. They say it will keep the boss from hiring another worker since for a robust economy, jobs have to be made for everyone who wants to work, as should everyone who likes to eat food produced by others. Dad appreciates the altruism that he has helped to inculcate, but family necessity demands it.
The other side counters by saying that two thirds of Dad’s discretionary income has long been going to his gun collection and security provisions, another family logic vacuum. Could he possibly sacrifice something there since the whole picture looks a bit distorted? He rejoins that that’s the way it’s always been. Children have no business overturning solid traditions.
Our parable shows us that to balance the federal budget, we must do two things, not just one or neither. We must cut less necessary expenses and appropriately tax. It is not enough to do just one. For someone to argue that we can just keep buying while putting it on the card is absurd on the national or family level. For someone to say that the progressive taxation called for by church social doctrine must not even be considered is just as absurd. This calls for taxing people according to their wealth, with the rich paying a higher percentage than the poor pay. To claim that this will encourage the rich to move elsewhere is an idle threat inexplicably invoked by many non-rich who are unaware that when we leave the rich untaxed, they do not hire. They buy more investments.
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