Obama said more dumb things the other day. Apparently rich people do nothing for this country. They don’t sacrifice anything, they just sit around and count their money. They went to monster.com, applied for the position of “millionaire”, were lucky enough to get the job, and now just sit around and collect their millionaire paycheck.
But if that’s all they do and they aren’t making any sacrifices, then why does Obama want them to pay less in taxes? His deficit reduction plan is to go back to tax rates that had the rich paying a much smaller share of tax receipts.
Maybe that was just a fluke. The Democrats, the media, and pre-algebra all tell me that a higher tax rate should equal more taxes. What about the other times tax rates have been cut – under Reagan, Kennedy, and Harding/Coolidge?
Reagan: Top rates were cut from 70% to 28%. The top 1% went from paying 17.6% when he took over from Carter, to 27.5% at the end of his Presidency. The pre-algebra was even farther off there.
Kennedy: Top tax rates went from over 90% to 70%. Percent paid by the rich increased from 11.6% to 15.1%
Harding/Coolidge: Top tax rates were cut from 70% to 25%. Those making over $100,000 went from paying 29.9% of the tax burden to 61.3%.
How does this keep happening when the media assures me that it’s Republicans that don’t want the rich to pay their “fair share”? Andrew Mellon, the Treasury Secretary under Harding and Coolidge explained it this way:
“The history of taxation shows that taxes which are inherently excessive are not paid. The high rates inevitably put pressure upon the taxpayer to withdraw his capital from productive business and invest it in tax-exempt securities or to find other lawful methods of avoiding the realization of taxable income. The result is that the sources of taxation are drying up; wealth is failing to carry its share of the tax burden; and capital is being diverted into channels which yield neither revenue to the Government nor profit to the people.”
The idea has the bi-partisan support of President Kennedy:
“An economy hampered by restrictive tax rates will never produce enough revenues to balance our budget just as it will never produce enough jobs or enough profits… In short, it is a paradoxical truth that tax rates are too high today and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now.”
When rates are high, the rich are the most able to find ways around them. We need lower and flatter taxes to make it so the rich invest their money instead of hiring lawyers and accountants to find ways out of taxes and make it so companies don’t change their business models and make themselves less efficient just to take advantage of the tax code. Lower, flatter taxes would encourage investment, bring in more revenue, and lead to the rich paying a higher share of all taxes. I would be beneficial to everybody.
Obama wants to hamper investment and bring in less revenue from the rich. He must really hate poor people.