Trump Taxes Reveal Greater American Epidemic

Politics aside, the recent New York Times article about President Trump not paying taxes reveals a deeper, systemic problem than a mere "bombshell" report. But, it is not the conclusion you may think.

Whether you are a die-hard Trump supporter or a staunch critic of the President, doesn't really matter in the context of this argument. The fact is the New York Times, and those criticizing the President for not paying taxes are missing a key element in understanding IRS tax code, basic economic principles, and financial literacy.

The problem with most journalists and politicians is they do not understand capitalism or entrepreneurialism, which is the life-blood of our economy. While many of them became rich off the American taxpayer, having little to no experience in actual job creation or understanding of economic investment opportunities, their ignorance drives their push to speak ill of successful entrepreneurs and business owners - the very source of America's income.

For years, financial literacy, life skills, basic economics, civics classes, home economics, health classes, parenting and family planning courses, accurate historical lessons, and unbiased debate classes, have all been eliminated from both homes and schools across America.

Today's youth and many adults lack the basic understanding of how our economy works, much less how our IRS tax code - which was created by the very same politicians who are now accusing Trump of not paying taxes - was written to benefit business owners, CEOs, and entrepreneurs, which in turn benefits the overall economy.

We need the rich!

Whether you like the fact or not, we need the rich! We need for them to have tax advantages, deductions, and credits to decrease their tax liability simply because what the NYT article doesn't tell you is that the top one percent of all American income earners (making $500K or more per year) pay 39% of all income taxes.

Nor does the article mention that the top ten percent of income earners (making $145K+) pay 70% of all income taxes, leaving the remaining 30% to income earners who earn less than $100,000 per year. In fact, most Americans earning $41,000 per year pay only 3% of income taxes.

Whether it is Donald Trump, Bill Gates, Elon Musk, Oprah Winfrey, Jeff Bezos, Warren Buffet, Mark Zuckerberg, or the Walton family (heirs to the Walmart fortune), all millionaires and billionaires take advantage of tax law. Does it favor the rich? Absolutely! But, keep in mind, all of us NEED the rich, and in a larger picture, we need them to have tax advantages, because in the end, we all benefit!

While that may sound counter-productive, and critics will claim I'm off my rocker because the "rich get wealthy on the backs of hard-working Americans earning crappy wage," the truth is there are three ways to become a millionaire/billionaire in America:

  1. Inherit a fortune

  2. Win a sweepstakes, lottery, or some other game

  3. Work your butt off, create a business, invest, and EARN your own fortune

Frankly, unless you have a rich uncle, sugar daddy, or some other multi-gazillionaire in your family, option one is highly unlikely to happen. And your chances of winning the multi-million dollar jackpot lottery is about the same as you flying to the moon. However, in the U.S. alone, there are 13.6 million millionaires, up 283,000 from the previous year, and according to the Spectrum Group, the number of millionaires in the U.S. will reach 18 million by next year.

This validates that not only does capitalism work, America is the greatest land of opportunity for all! In no other country are millionaires created at that rate of success. No other country offers the opportunities for someone like Oprah Winfrey to go from a poor child in the ghetto to a highly successful media mogul or a college drop-out, like Steve Jobs, to become a business tycoon! And you and I have the same opportunity!

Most simply lack the education to achieve such a high level of influence.

But it doesn't necessarily take a college degree to become a millionaire. In fact only 18% of millionaires have a Master's Degree. 80% of millionaires are first-generation, meaning they didn't inherit their wealth, but created it through innovation, hard work, and creativity. And, most millionaires are unknown because they are not famous, live in regular American homes, drive regular cars, and live regular lives.

The bottom line is this - we need to reinstate the core living classes, such as financial literacy, speech and debate, civics, home economics, health classes, and courses that teach life skills back into our schools and homes. Trump's taxes reveal less about how much he pays and more about our lack of understanding basic economics and investments.

Don't be fooled by media headlines and political rhetoric. America must arm itself with a deeper understanding of our system, knowing it is the greatest system (despite its own flaws) in the world. That's why so many people from other countries are flocking to America. If it were not so, they would stay home and continue living under their rule of government.

#TrumpsTaxes #financialliteracy #economics #president #potus #government

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Leo Pacheco | Personal Development | Life Coach | Innovative Strategist