He hearkens back to a couple of earlier arguments:
the twelfth and thirteenth
sections of book six in which he distinguished practical wisdom from mere
cleverness (practical wisdom aims at what is good, while cleverness may aim at
any old thing), and the second
section of this book in which he insisted that incontinence is
not a variety of practical wisdom (in other words, the incontinent
person doesn’t change his or her mind at the last minute because of a
sudden better grasp of the situation).
He brings forward a new analogy to explain the difference between the
incontinent person and the intemperate one. The incontinent person is like a
city that has good laws on the books but that doesn’t enforce them; the
intemperate person is like a city with bad laws.
He also emphasizes here that continence is not a binary thing that you either
have or don’t have. It’s measured on a scale — the continent person has more
self-control than the average person, the incontinent person less.
Finally, he notes that incontinence due to impetuosity (failure to deliberate
at all) is easier to correct than incontinence due to weakness (inability to
stick to the choices you make by deliberation). Also, incontinence that is
acquired by bad habit is easier to correct than incontinence that is innate
(though he notes that habitual incontinence can become as-if-innate over time).
The government has a variety of programs that are supposed to help poor people
by either giving them money (for instance, via the Earned Income Tax Credit),
or money-like resources (for instance, food stamps), or other benefits (for
instance, Medicaid or housing subsidies).
These benefits are directed to financially poorer people, and so they end or
phase out as a person’s income rises. But if the programs are carelessly
designed, this can lead to a situation in which a person can actually become
worse-off by earning more money. That is to say, by earning an extra dollar,
a person might lose more than a dollar in benefits. This is a strong
disincentive to earn more, rise out of poverty, and get off of government
The Mises Institute recently ran the numbers for a hypothetical single parent
living in Virginia with two children and came up with
graphs showing the effective marginal tax rate on this person at various
income levels. As benefits cut off between about $20,000 and $45,000 in
income, the tax rate for those dollars is greater than 100%. In other words,
if this hypothetical person were earning $20,000 a year, she would be
financially worse off were she to get a 50% raise, and worse off
still if she were able to double her salary.
This can have the effect of promoting and maintaining dependence on government
welfare programs. And it’s not a matter of the bugaboo of lazy welfare bums
preferring a handout to an honest job. You wouldn’t exepct anyone to be
willing to run more than twice as hard just to stay in the same place,
particularly a single parent.
Tax savings for energy-efficient improvements to your home have increased this
year. If you’re an American home-owner, you may want to
these tax provisions to see what you can take advantage of.
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