I have long combated the mindset that “we can’t afford to give tax breaks to the wealthy” as though it is the richest taxpayers’ primary obligation to pay a higher rate of taxes and that tax “breaks” are a privilege they receive only during prosperous times (which, for the government, is never). Last night on The Daily Show, Jon Stewart took note of Obama’s Orwellian phrasing of tax hikes as “spending reductions in the tax code. The entire video is well worth watching, but the key part is at the 4 minute mark:Vodpod videos no longer available.
To claim that we cannot “afford” to let people keep their money because we have spent ourselves into debt is akin to claiming that I have maxed out all of my credit cards and taken out loans that I cannot repay and thus cannot afford to not rob my neighbor to pay off my debts.
To those that claim tax hikes are the only way to pay down the national debt, both Reason and the Center for Freedom and Prosperity have debunked those claims, and the ever-brilliant Walter E. Williams explains that taxing the top income earners at a 100% rate still won’t solve our financial woes:
This year, Congress will spend $3.7 trillion dollars. That turns out to be about $10 billion per day. Can we prey upon the rich to cough up the money? According to IRS statistics, roughly 2 percent of U.S. households have an income of $250,000 and above. By the way, $250,000 per year hardly qualifies one as being rich. It’s not even yacht and Learjet money. All told, households earning $250,000 and above account for 25 percent, or $1.97 trillion, of the nearly $8 trillion of total household income. If Congress imposed a 100 percent tax, taking all earnings above $250,000 per year, it would yield the princely sum of $1.4 trillion. That would keep the government running for 141 days, but there’s a problem because there are 224 more days left in the year.
How about corporate profits to fill the gap? Fortune 500 companies earn nearly $400 billion in profits. Since leftists think profits are little less than theft and greed, Congress might confiscate these ill-gotten gains so that they can be returned to their rightful owners. Taking corporate profits would keep the government running for another 40 days, but that along with confiscating all income above $250,000 would only get us to the end of June. Congress must search elsewhere.
According to Forbes 400, America has 400 billionaires with a combined net worth of $1.3 trillion. Congress could confiscate their stocks and bonds, and force them to sell their businesses, yachts, airplanes, mansions and jewelry. The problem is that after fleecing the rich of their income and net worth, and the Fortune 500 corporations of their profits, it would only get us to mid-August. The fact of the matter is there are not enough rich people to come anywhere close to satisfying Congress’ voracious spending appetite. They’re going to have to go after the non-rich.