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Rantz: Stop using these bad income tax arguments

(Bryce Edwards, Flickr)

When rich people support Progressive ideas that seem against their self-interest, we’re supposed to celebrate them while ignoring the advice or guidance from the wealthy that don’t adopt Progressive positions. Perhaps that explains why people keep sending me a CrossCut piece written by local engineer Ned Friend that begs the City of Seattle to tax his income.

There are some issues with his logic that are being missed in all the fanfare.

Friend argues that “Seattle should tax me and the rest of the highest paid 5 percent…” and he endorses the recently passed council plan.

He continues:

We do not live in a world of kings who steal from their peasants to build private castles. We live in a democracy where our taxes fund shared public services. Taxes aren’t theft; taxes are how we collectively pay for a better Seattle.

He’s right. We don’t live in that world. In fact, I’m not sure what world he’s talking about. Seattle doesn’t steal from the peasants to build private castles. And as much as we want to pretend we live in a city filled with financial injustice, the median Seattle income is $80,000, which can more than afford some of the pricier apartments in the area. In fact, as Gene Balk points out, if you’re earning under $80,000 per year, “you’re now in the minority in Seattle.”

Some of the issues Friend wants to address fall around housing and services. He notes that Portland, San Francisco, and New York have local income taxes, so we should too. He says:

High-income households are moving here [Seattle] in droves, driving up rents and straining our public services. This tax ensures our city can fund those services so Seattle remains attractive, livable and more affordable than places like the Bay Area and New York City.

First, bizarrely, he notes that SF and NYC are unaffordable while using those cities as examples of places that allow for local income tax. He hurts his own argument.

But on housing, his view is simplistic. Rents are up in Seattle primarily because of a low vacancy rate (it’s under 5 percent), driven by a lack of supply. Rents go up when demand exceeds supply. So, if low-income people were moving to Seattle in droves, rents would still be going up if the lack of supply isn’t addressed. This is basic economics.

And let’s not ignore a basic fact: the average person in Seattle, based on the median income they earn, can afford Seattle housing. Yes, it’s expensive. I don’t want to pay as much as I pay for my one-bedroom, but I can afford it. Affordability isn’t defined by our desire to pay for something; it’s based on our ability to pay for it.

Next, I’m not entirely sure what Friend means when he complains the rich are “straining our public services.” No, they’re not. They’re paying for them and, in many cases, they’re paying for services they don’t actually use.

Friend doesn’t mention what services he’s referring to, and my message to him has gone unanswered, so it’s difficult for me to speak to specifics. But let’s make an assumption. Perhaps he’s talking about transit, which is handled by King County. Well, the wealthy who bus to Amazon in South Lake Union pay taxes that go to the buses and road infrastructure. They also pay for their Orca cards – they’re not being subsidized. I’m unaware of any service subsidies the wealthy are receiving that would put a strain on the services, but I’m certainly open to exploring any specifics that Friend provides and will gladly correct my assumption if incorrect.

Further, Friend goes on to say that the tent cities and gridlocked highways create an unfavorable business climate. Do they? Both homelessness and traffic have gotten worse, but businesses are still coming and/or growing in Seattle. In fact, Progressive politicians constantly point this out.

What doesn’t quite make sense is this fear that current conditions in which we live — high housing, strained services, tent cities and gridlock — will make Seattle unattractive to people moving here. They’re moving here now, under conditions that Friend says include stealing from the peasants and services we’re not being provided. It’s so bad now, apparently, the city needs an income tax. Well, why are the rich coming then?

These arguments are rather weak. They fit on bumper stickers, but don’t get at the real reason most are calling for income taxes: they have ideas for policies and services that are expensive. It’s easier to go after the wealthy because they have money you can take. So why not just say that? Don’t pretend we live in a city that sounds like a fiefdom. That’s absurd.

If Friend can afford more in taxes, good for him. He’s achieved a level of success that some might envy. Until the city collects 2.25 percent of his hard earned dollars, I would recommend he spend that money on charitable organizations that help the issues he’s most concerned about. I’ll happily send a list to him that I think are worthy of his dollars and perhaps you reading this can leave in the comments section groups he can support until the council is able to tax us.

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