Sunday, September 28

Paying Taxes Worse Than Investing in the Stock Market?

The stock market is predicated by the idea that, for most of us, good investments come from patiently riding out waves of the market and, of course, buying stock at low prices and selling it when the price is high. This is a voluntary activity, though, in fairness, more and more employment retirement programs are being tied to it

Paying taxes, on the other hand, is not a voluntary activity. In fairness, we get a lot of good stuff from our taxes: schools, medical research, streets and highways, mass transit, and, oh, a social safety net, to name a few. However, it also pays for weapons of mass destruction, bailing out corporations, rewarding the richest of us, and more.

The say we have in this is limited to voting for (and cajoling thereafter) candidates who best represent our views. Note that investing in the stock market is participating in a lightly (apparently) regulated free market, while paying taxes is a result of representative democracy. In both cases, the outcomes of choices we make leave no one to blame but ourselves.

If you invest in stock, you are given a prospectus, a document that outlines the background and performance of what you are about to invest in. When choosing a candidate, you are given puffed up ads, platforms, and their word--pretty thin stuff, comparatively.

When you invest, you can pull your money out, if you don't like the direction the stock is going (at some cost, to be sure), in a democracy, you have to wait between 2 and 4 years and continue to pay taxes regardless.

If the stock market gets into trouble, one of two things happens--it "corrects" itself or it gets "bailed out". When the government gets into trouble, we foot the bill.

In the final tally, if the stock market fails, we would be seriously hurting, but the "investor class" more than others. If our government fails us by using our taxes unwisely, we all are cooked.

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