Saturday, June 7, 2008

The Ghost of 1969

In 1969, the United States enacted the Alternative Minimum Tax (AMT). The AMT was a rapid-fire political response to a newspaper story that 155 high income individuals legally paid no income taxes.

Since 1969, the US has had not one, but two income tax codes: the regular tax and the AMT. A taxpayer has to calculate his or her income taxes twice, and pay the greater of the two taxes.

The AMT was built and deployed to catch just a handful of people. These people were not criminals. They had complied with the law as it was. They were just very good at legally avoiding the income tax.

In 1969, they discovered that their success had made them a political target. But the target was small, and no one else cared. Today, that target is much bigger.

According to Ira Weiss of the University of Chicago, the AMT will affect 30% of American taxpayers this year. These taxpayers will find themselves in a Kafkaesque world of English language sentences that make no sense. These modern taxpayers are paying the price for the class warfare, envy and political expediency of 30 years ago. If ever there was a case for why we should be cautious before letting the government fight all our fights, right all our wrongs (both real and imagined), and pander to our most selfish instincts, the AMT is it.

Crusading for justice, the government created greater injustice. In the name of fairness, it destroyed what is fair. In the name of the people, it loots the property of an ever larger number.

The ghost of 1969 haunts us today, no longer imaginable as the face of justice. We can see it for what it really is.

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