Sunday, January 29, 2012

Compliance Is Voluntary.

It doesn't happen all the time, but every so often while driving down the highway, I will see a car pulled-over by a highway patrolman. Even more rarely, the patrolman has pulled over a motorcycle. Whenever that happens, I think to myself that if I was the cop I would be lenient to the rider of the motorcycle.

It is not like the motorcycle had to stop, at least not in the sense that he would have had to stop if he was driving a car. The fact of the matter is that almost any bike could out-run and evade a patrol car in a way that even an exotic sports car could not do.

So cut the guy some slack. That's all I'm saying here.

Similarly, I feel much the same--only more so--about paying the capital gains tax. Mitt Romney has caught a lot of flak for his average tax rate of about 15%. The rate for him seems low only because almost all of it is not in the form of regular income but rather from long term capital gains, which are taxed at 15%. The thing about it though, is that you don't have to pay any capitol gains tax as long as you keep the assets. Romney sells-off some of his assets each year to fund charities and cover his living expenses and he pays 15% on whatever he takes out.

The important thing to remember is that he hasn't worked (not for the primary purpose of earning money) since 1999. He has been living off of his wealth for more than 20 years! This has given him the freedom to do things like be governor of Massachusetts, run for president a couple of times, volunteer with his church and run the Winter Olympics when they were held in Utah.

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