Minor Thoughts from me to you

The Wisconsin State Journal published a few local reactions to the Wisconsin's ongoing budget debates. One reaction caught my eye.

Christa Decker of Madison said she depends on Medicaid programs for everything from her wheelchair to doctor's visits to long-term care. Decker, 51, who has both physical and cognitive disabilities, said that cuts to those services would have a direct impact on her life.

"You cannot cut out part of my life. This is too important to me," Decker said.

I'd like to pick on Ms. Decker just a little bit, on my way to illustrating a point. Ms. Decker is supported by money that comes from every taxpayer in Wisconsin and taxpayers from around the nation. Ms. Decker's life is sustained by the work of everyone around her. She's making a fairly common blanket statement: "If you cut taxes, you'll cut the money I depend on and throw my life into chaos."

That is a legitimate worry. Many people have come to depend on the money and services they receive from local, state, and federal governments. But there is another worry too, one that's expressed far less often. "What is the real cost of giving all of this money away?" Let me give you an example, straight out of my own budget. First, here's a breakdown of where our income goes.

Mortgage

25.84%

Taxes

21.42%

Tithe

10.37%

Student Loans

8.65%

Groceries

3.17%

Gasoline

3.04%

The remaining 30% goes into a large variety of small expenses and savings. Notice that $1 out of every $5 dollars we earn, goes straight into taxes. $0.20 out of every $1.00. $21 out of every $100. Gone. Straight off the top. That's a significant fraction of our income. We're a young married couple, just 2 years out of college. There are a lot of things we could be spending that money on. Here's a short list.

• Paying down student loans
• Paying down our mortgage
• Replacing the old roof on our house
• Replacing the ancient windows in our house
• Finishing our basement to increase the living space in our house
• Saving for a new laptop, to replace my wife's rapidly aging one
• Saving for a new car, so we won't have to take out a car loan next time around
• Saving for retirement
• Saving for our children's college education
• Saving to visit my parents, in Papua New Guinea

As you can see, paying down loans and increasing savings is a large part of our financial goals. We'd love to be free of our debt. There are times that it seems almost achievable. For instance, if we weren't paying taxes the past three months we could have either paid of 68% of one of our student loans or 20% of our home equity loan. And that's just in a three month period.

That's the cost of those "free" government services that so many people enjoy. Ms. Decker's life is financed by my family's increased debt and decreased savings. Oddly enough, those are the costs that are most likely to make me need a government handout later in life. Ironic, isn't it?

I don't know where the dividing line between necessary and unnecessary taxes is. And I don't have a plan for weaning the public off of the dole. I'm still thinking about that. But just remember that government services aren't free. And that the money I'm spending on taxes is money that I'm not spending on goods and services -- money that could be used to create jobs and wealth.