Friday, September 30, 2011

Government Created Sprawl by Way of the Road

I don’t understand the reasoning behind how someone can cut the taxes of small business and yet raise the taxes of the rich when many of such businesses make above $100,000 in annual revenue. I can attain a fairly good standard of living off a cooperative rental arrangement making only $15,000 so I would call people that make nearly seven times that to be considerably more well off than myself and dare I say it, maybe even a little “rich”.

I have often felt that small business owners can be considered rich in terms of certain measures of their income yet at times, the entrepreneurial nature of small business can spur on sacrifices made by the owner in order to save and later invest in the expansion of their business. Maybe at times a rich entrepreneur makes an income of $200,000 in store revenue, yet can only take home $30,000 for themselves annually. I’m no expert in the inner workings of the IRS or its workings of the tax code, but it seems to me that there is plenty of room for business owners and “rich” people can get mixed up.

I fear that what happens in a debate when class warfare gets involved, is that employees forget the symbiotic nature of their relationship with their employer. Granted small business owners and “rich” people generally have more money than I do but maybe we should ask ourselves what these people may have done to deserve this income and perhaps the large accumulation of wealth that goes along with it. These people may have taken a risk where they luckily came out on top and were able to support a lot of us little people by paying our wages.

I don’t want a large amount of rich people’s money flowing out of their bank accounts and into the governments coffers. Without that vast sum of money in the free market innovation is stifled because the rich people won’t have enough money to pay the innovators that come up with new ideas and products which happen to be really expensive because of the time and valuable resources that were poured into them.

But how does this relate to sprawl you may ask? I would answer that the ways in which the money is going to be spent has a direct impact on sprawl. This money is taken by the government from the “rich” a demographic which presumably would end up including entrepreneurs of all types, even the small business types everyone loves. So envision a world where these people have less money to spend on expanding their businesses which would most likely lead to more jobs on the market.

What does the government do with the money you ask? It utilizes some tax money, engages in a little deficit spending and uses it just like the Gazette states in the article:
    The president, who remains popular in California despite his national slump,     urged the crowd to press members of Congress to approve not only higher taxes     on the wealthy but also new spending on roads and bridges and the rest of his     economic agenda.

According to many of the articles we have discussed in class is that it is the construction of roads that facilitate transport that is so cheap, it leads to incentive's that cause movement out of the city.

I find it rather humorous that some of the very actions the government takes to shape the state and nature of the economy ends up conflicting with some of their other aims such as preventing the hemorrhaging of the cities of the U.S.

Aside from that it is also intriguing to think of the alternative that was presented in our discussion of the past week in which we considered a world in which private owners and entrepreneurs formed associations so that they could properly take care of the roads instead of the government.

While I think a transition from government maintained roads would be difficult I think after the transfer of ownership was complete, we would see some positive trends in American road ways. With individual ownership of smaller segments of road the owners could focus on their own areas and their respective flaws. Things like pot holes could be fixed much quicker because people at a smaller level would then be permitted to fix the road. Instead of blaming a large and impersonal government for roads that weren’t up to our standards by saying “someone should fix that” we can take charge of our own areas pooling our money with other people in our communities so that we can finally be able to say “we can do something to fix that.”

Private ownership of the road way would mean that construction and maintenance would no longer lead to deficit spending that drives up taxes. Many roads nowadays could be classified as a bit superfluous and a strain on government budgets. Privately owned roads would utilize concepts from the open market that would prices to be ascribed to road ways so that efficiency could be maximized. A reduction in congestion would presumably follow.

This is a concept I had never really considered but after realizing a road system based on the market would stand a fair chance of not degenerating into a chaotic anarchy I think it is an interesting concept that should at least be examined more closely before being dismissed entirely.

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