I know that most politicians understand the inverse relationship bewteen tax rates and tax revenues. It has been the case multiple times throughout the past 50 years that when tax rates are cut, the economy surges, and tax revenue swell to record levels. This was the case in the Kennedy administration, the Reagan administration, and in the "W" administration.
While this is a semi-counter intuitive reality, it is not outside the grasp of all the "smarties" currently in or running for political office. I know that democrats understand this as well as the reverse to this reality which is that higher taxes tank the economy and therefore reduce tax reveues. So if everyone understands this, why are the dems hell-bent on increasing taxes? Why do they want to soak the tax payers who are paying the vast majority of US taxes? Is it punative? Is it that the leading dems truly are socialists?
There are a few other realities that the tax-happy dems should understand before they reach further into the pockets of the "producers" in this country:
1) Most of "the rich" that they laoth (though the dems in congress ironically are all very rich) are all smart emough to find ways around any tax increase plan. The smartest politician cannot outsmart the high end tax payer...who is a likely a high-ender becuase they are smart, motivated problem solvers who understandably want to keep the money they earn. That is how the system works. I have talent/skill, I work hard, I do a very good job, and get the prize. There is no better system in the world. Most high-enders pay a ton of taxes. I think most high-enders know that they earn a lot and will pay a lot. But they are currently taxed to the brink, and if they are saddled with more unfair, redistributionist taxes, they will find ways to avoid them. I am so happy for them in this endeavor.
2) No matter how hard the government wants everyone to be "okay" and to have a middle class standard of living, there are those who will spit the bit. Congress cannot force every American to show up to work on time, to work hard, to save for a rainy day, to go the extra mile on the job. Congress cannot force people to not have children out of wedlock, to stay married when they decide to get married, and to finish high school. This is the simple recepie for a modicum of success in the US. It is not a hard plan to follow, but there are many who will not.
The best intended programs will not lead to "no hardship for anyone". The tax burden imposed by unecessary and overreaching government programs will throttle the economy and kill the golden goose of United States free-market capitalism. The irony in the democratic tax and spend plan is that the folks who the dems allegedly want to help are the first ones to get kicked in the shins during a tax hike induced economic recession. The rich that the dems want to take down several pegs can weather a pretty rough economic ride. How does the paycheck-to-paycheck clerk make it when the recession forces their employers to cut their job.
3) the best thing any politician can do in managing the economy is stay out of the way. The US system is the best in the world. It creates millionaires who started from humble beginnings. It rewards innovation and hard work. It is the only system in the world that is self-limiting. My success in this system is limited by my ability, my work ethic, and the value I bring to the market. I limit my earnings and my worth in the market by the decisions I make. I do not want my economic success limited by decisions of power-addicted weanies in Washington who have never held a real job, never run a business, or had to make a payroll. Our system is the envy of the world, why do the dems want to kill it for government mandated mediocrity? Medicrity for everyone...courtesy of Uncle Freakin' Sam.
The United States tax problem is not a problem of too few revenues, the tax problem is too much spending. The tax problem in the US is a function of careerist politicians from both parties who want nothing more than to be re-elected and use tax-based handouts to buy votes. There is nothing wrong with the free market system in the United States. It works best when left alone. The free market has given us the standard of living we enjoy, the products we use, and the opportunities we leverage. It is our biggest asset. What is seriously broken in our country is the devolution of our republic into system of government handouts where political support is bought and paid for by politicians dreaming up new government guaranteed benefits for things that the free market and free consumers should provide for themselves.
If the government would stay out of the free market, there would be more and better of everything for those who chose to participate in what this country has to offer. I wish there were a politician with the courage to deliver this message to the nation. I guess it is easier to hand out "free" prescription drugs, retirement plans, and health care.
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