Wednesday, November 28, 2007

IQ and Economics

I would like social reformers to remember one little thing. Half of the population is below average in IQ. That means that every time you add a layer of complexity to society you are leaving another slice of the people out.

Do your own taxes? I guess that a lot of very intelligent, but wealthy people have someone do their taxes for them. So the complexity of the tax code is irrelevant, as long as there are experts who can be hired to do taxes, the wealthy couldn't care less. In fact, the complexity is a feature, not a bug. It allows all sorts of tax shelters to exist hidden in the mass of paperwork.

But lets look at it from the point of view of the stupid. And lets not kid ourselves. There are stupid people, and they have to do their taxes just like everyone else. But hey! What high-paying jobs are there for stupid people? A lot of them work for the government, of course, but really, stupid people tend to get paid low wages. So they are stupid and poor. Not many hire a tax accountant to figure out their burden. Instead, they muddle through it, miss all the savings they might have gotten, make mistakes that could get them in trouble, and end up paying when they shouldn't have. Besides all that, it takes hours and days to figure out all the forms, if you only do it once a year. Wasted money, wasted time, wasted life.

But hear the outcry when anyone suggests a major simplification of the tax code. In spite of all the good it would do for the most vulnerable in our society, the stupid, no big name Democrat is willing to sign on.

Amazingly it is Republicans who favor tax simplification (at least a few Republican pols say they favor it) while Democrats oppose it, supposedly on the grounds that it would reduce revenue to the government.

I am confused. The evil mean corrupt Republicans want to simplify the tax code and make life easier for the weak and helpless in our society, while the shining knights of liberalism want the current dark swamp of despond tax code we currently have?

Don't they care about the stupid? Looks to me like they care more for the welfare of the government than for the poor.

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