Matt Damon Interview on Debt Ceiling

This video is making the rounds, unfortunately for the wrong reasons.   In this clip, Matt voices his opinions on taxes, and his feelings that the rich should pay more of their fair share.  He says that he would not mind paying more himself.

It sounds so simple and so fair.  "People that have money should help others by paying more taxes."   On the surface it is such a hard point to argue with, unless you have time to really sit down and discuss the deeper issues surrounding this idea.   It just so happens that we do have time for that today, so let's discuss!

Let's break down the statement, which really has two parts.   The first part has to do with the idea that people with resources should help those that do not have resources.   Yes, Yes, Yes!!!!   Who could argue with that statement.    That idea is what makes our country so great.  No other country in the world donates more time and money to charities than the United States.  It is the "American Way" to give of ourselves and our time to help others.   We only wish that more Americans would find ways to help, but overall we can feel proud of our selfless nature.







The second part of this idea is what is so concerning.  The idea that paying taxes is "helping others" is simply not true.  Yes, some of what the government provides does benefit some, but that help comes at the expense of many others, and at a very high price!   This is because the government is very inefficient overall.   Every $1 paid in taxes results in far less than $1 of value on the other end.   That means that the government is wasting resources that could otherwise have been used to benefit others.   Yes, many charities and other organization have inefficiencies as well, but we are free to donate our money to those that are most effective and efficient at delivering benefits to others.  That freedom of choice drives charities to strive for better efficiencies in an effort to attract more donations. Those that are not run effectively should ultimately go away as funds dry up.

When we pay taxes, we don't have that choice.  There is virtually no accountability for how those funds are used and how effectively they are managed to provide maximum benefit to others.  That is the whole problem in a nutshell.   It comes down to inefficiencies and total lack of accountability at the highest levels. When the government takes over, there is a significant waste or resources that could otherwise have been used for the greater good of society.

Of course, many will try to make the point that "people will save their money if taxes are lower, not donate it all the charity."   You may be surprised that the answer is "Yes, that is exactly right, and that is a great thing"!   First, we only need to donate a fraction our "saved taxes" to charity to get the same end result and benefit as we had from our entire tax bill!   If it was taking $20 a day to feed that child with our taxes, it now may only take $1 a day to feed that same child via an efficient, private charity.  That leaves $19 to spend or save as we see fit via our individual freedom and liberty.  If we save every dollar, what we end up with is a nation sitting on trillions of dollars of savings, rather than trillions of dollars of debt!   That is real financial strength that can be put to use in the most effective manner in an effort to earn a decent return on investment.  If that money is spent, money flows into the economy in a way that rewards innovation and hard work.  Don't let anyone try to tell you that "saving" is a bad thing for our economy.  Saving is what creates strong, innovative, growing economies that can weather any financial storm.

Yes, we all need to donate our money and more importantly, our time, to help others.  However, the notion that paying taxes is the best way to achieve that help is a terribly misguided idea.
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