Cutting Taxes on the Rich - Not in their Best Interests
George Allen is singing from the Republican play book in his latest ads on taxes. This is not the place to either call out the untruths of the ad, which his opponent, Jim Webb has done, but to attack the basic premise that cutting the taxes of our wealthiest citizens is actually good for our wealthiest citizens.
While the economy may be rebounding under the Bush tax cuts, it is doing so because of a very Keynsian debt. We are, in essence, borrowing money from the wealthy and the Chinese in order to finance current spending on the disasterous war in Iraq and the Pentagon's latest spending spree.
The taxpayers of the United States owe a lot of money to a lot of people - largely because of the War and the President's tax cuts. This indebtedness is possible because the debt is financed by the federal government's ability to tax higher income individuals and to seize the assets of those who refuse to pay - just ask Willie Nelson about this. The old canard about every man, woman and child owing a piece of the national debt is just that, a canard. In reality, any individual can figure their liability for the debt by taking their annual tax liability and multiplying it by 8.6. (The total debt/total income taxes). This will give each taxpayer an estimate of how much they owe the Chinese, the rich and the future retirees who will want payment from those bonds held by the Social Security Trust fund. Of course, it does get a bit worse. The IMF/World Bank is ultimately backed by the ability of the American Government to tax, so all that bad foreign debt is potentially on the American taxpayer too. Not a pretty sight.
When the Republicans cut taxes on the wealthy, they shifted the percentage of the federal debt burden more toward the middle class - although by throwing the budget out of balance they increased the total burden for everyone, especially the wealthy, since in a few short years the Bush tax cuts evaporate and any serious effort to balance the budget must include revenue from this economic strata - increasing anyone else's taxes will cut consumption enough to throw the economy into a tail spin. When taxes eventually have to go up, there is only one group that can be taxed - the wealthy. The longer we wait, the worse that bite will be. It would be better for our wealthiest taxpayers to pay down the debt responsibly, including the debt held by Social Security. Then we can talk about permanent tax cuts.
While the economy may be rebounding under the Bush tax cuts, it is doing so because of a very Keynsian debt. We are, in essence, borrowing money from the wealthy and the Chinese in order to finance current spending on the disasterous war in Iraq and the Pentagon's latest spending spree.
The taxpayers of the United States owe a lot of money to a lot of people - largely because of the War and the President's tax cuts. This indebtedness is possible because the debt is financed by the federal government's ability to tax higher income individuals and to seize the assets of those who refuse to pay - just ask Willie Nelson about this. The old canard about every man, woman and child owing a piece of the national debt is just that, a canard. In reality, any individual can figure their liability for the debt by taking their annual tax liability and multiplying it by 8.6. (The total debt/total income taxes). This will give each taxpayer an estimate of how much they owe the Chinese, the rich and the future retirees who will want payment from those bonds held by the Social Security Trust fund. Of course, it does get a bit worse. The IMF/World Bank is ultimately backed by the ability of the American Government to tax, so all that bad foreign debt is potentially on the American taxpayer too. Not a pretty sight.
When the Republicans cut taxes on the wealthy, they shifted the percentage of the federal debt burden more toward the middle class - although by throwing the budget out of balance they increased the total burden for everyone, especially the wealthy, since in a few short years the Bush tax cuts evaporate and any serious effort to balance the budget must include revenue from this economic strata - increasing anyone else's taxes will cut consumption enough to throw the economy into a tail spin. When taxes eventually have to go up, there is only one group that can be taxed - the wealthy. The longer we wait, the worse that bite will be. It would be better for our wealthiest taxpayers to pay down the debt responsibly, including the debt held by Social Security. Then we can talk about permanent tax cuts.
posted by Michael Bindner at 9:49 AM
2 Comments:
Thew joke is on them however, at the rate we're going there will be no more middle class and we'll be a nation of super wealthy and working poor, a lot like India.
The working poor of India will have many of our jobs. We will merely sell the stuff they make at WalMart (which is actually a better employer by the numbers than Starbucks, but that is another story).
The fun is unmasking the joke. Lets hope word gets around. Thanks for visiting the new site.
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