I Think it Comes Down to Trust, or Lack of it

I am not sure why the Dems are so enamored with raising taxes. They hope to get new taxes enacted ASAP by hoisting the populist message that their new taxes are only on "the rich".

There are several problems with this however for all of us. First, what is the hard definition of the mushy term "the rich"? Is this based on net worth? Is this based on W-2 earnings? What level is determined to be "rich" and who gets to decide? There have been proposed tax schemes in the past where rich has been defined as a household earning more than $ 200,000 per year, or $ 100,000 per year, or $ 78,000/ per year. Get the picture? Rich is a term that bends to meet the need of the argument for the specific tax increase. I can tell you that when raising a family of 3 kids, $ 100,000 and even $ 200,000 is not rich. It is a good foundation to support your family and gives you some options in education and lifestyle, but rich? Hardly.

The next problem is this; when has there been a tax, once enacted that went away, or shrank without tremendous angst and taxes hikes elsewhere so any reduction is revenue neutral? Answer, somewhere between never and rarely. The problems with increased taxes are obvious, the question I have is why, when the economic risks are so great, are the Dems willing to take these risks to increase the federal coffers?

I think it is because the Dems do not trust people and markets. They cannot fathom that the market, the aggregate of millions of people making independent decisions on a daily basis that will determine their daily state if not the long term outcome of their lives, can arrive at a state through the invisible hand that can be better than the heavy hand of government intervention. The Dems want a minimum of guaranteed success for everyone, no matter the individuals role in their own outcome. They do not trust democratic process nor capitalist free markets. Therefore, like a nosey mother who cannot cut the apron strings with her children, the Dems have to micro manage decisions for everyone, no matter how little people may want government meddling.

The Democrats have been called arrogant and elitist in their notion that they know better than the citizenry how to spend their assets produced through a lifetime of work. I think there may be an element of truth to this, but I think the larger driver is that they just do not trust the free market to allocate resources in the most efficient and just manner. This is where the democrats have left the building that our founding fathers created for all of us. They just don't trust markets and by extension they do not trust you and me and the decisions we make. The truth is that markets are "smarter" and more effective than any individual or group of leaders. If they could just learn to trust markets and trust those who exist in those markets, they might fare better at the ballot box and also leave a little more cash in the private sector...where it belongs.