This post was originally published on 10/1/2012.
Today’s blog is slightly off topic and maybe political but has an impact on your personal finances. The subject is social justice.
What is social justice? According to business dictionary.com, social justice is “the fair and proper administration of laws conforming to the natural law that all persons, irrespective of ethnic origin, gender, possessions, race, religion, etc.”
Wikipedia states, “social justice is based on the concepts of human rights and equality and involves a greater degree of economic egalitarianism through progressive taxation, income redistribution, or even property redistribution. These policies aim to achieve what developmental economists refer to as more equality of opportunity than may currently exist in some societies, and to manufacture equality of outcome in cases where incidental inequalities appear in a procedurally just system.”
In today’s political climate, the term social justice is being applied to our tax system. One belief is that lowering taxes for all (maybe a flat tax) and eliminating tax loopholes and deductions is the right approach to fairness and economic growth. The other ideological belief is that those at the top should pay more in their marginal tax rates and that income should be given or transferred to those at the lower end (social justice). Regardless of your stance on the subject, it has an impact on your personal finances.
Whether you are on one side or the other, here are some facts from the www.taxfoundation.org:
|Income Group||Income Threshhold||Group % Share of Income||Group % Share of Income Taxes||Average Tax Rate|
Note: The average tax rate is after deductions and adjustments have been made.
Based on the following data, ask yourself the following questions:
- Do the top 5% pay enough taxes based on their share of the entire federal income tax bill for the United States?
- Should we increase the top 5% share of federal income taxes?
- If we increase federal taxes on the top 5% and redistribute to the rest of income earners, what is the right rate?
- Do you believe its fair that 47% of Americans pay ZERO federal income tax?
- The Bible talks about giving and helping the poor, but does it recommend taking from one group and give to another against their will.
All of these questions and issues affect your personal financial situation one way or another. You can reduce the impact by having a sound financial plan and avoid victim thinking. This approach provides empowerment and can lead to prosperity.
Individuals and families without a plan will most likely end up in the bottom 50%, and victim thinkers will most certainly be advocates for the “Robin Hood” approach (Social Justice).
Question: Do you believe in social justice? If so, do you agree with this statement, “From each according to his ability, to each, according to his need.” To view the author of this quote, click here.