*This post was taken salvaged from the blog before the database was lost. However, there are no comments.*
I have to admit, when I read Obama’s tax policies, the fiscal conservative in me hurts inside. Why would we give people who aren’t paying taxes a refundable tax credit? Normal tax credits only apply as a discount to your taxes. Refundable tax credits are esentially checks from the government – the redistribution of wealth. See the Wall Street Journal for further information.
http://online.wsj.com/article/SB121910303529751345.html?mod=most_emailed_day
So you know what I hate about the plan – people who pay zero taxes will now get a welfare check to take home. Additionally, Republicans and capitalist cry out that taxing the rich just impedes growth and true growth is achieved by trickle-down, Reagonomics. Really?
I think it is time we recogonize that the world has changed since 1980. Consider that 2/3rds of the American economy is now consumer based. It make sense to stimulate the economy by giving tax breaks to the poor and the middle class. They will all buy their ipods and other consumer goods, which will boost our consumer driven economy. What good does it do to give corporations tax breaks so that they can produce products that no one has money to buy?
For you trickle-down/Reagonomics fans, consider that Obama’s 20% capital gains tax is lower than the capital gain tax in the Reagan administration. Obama’s plan taxes the income of the rich, not the investment of the rich. If anything, raising the income tax forces rich people to invest their money in order to be taxed on the lower capital gains tax.
Most people who discern the “redistribution” element of Obama’s plan feel that it isn’t fair. Well it’s also not fair that a CEO works for 17 days and then gets a $28M parachute the same day the company goes to zero at the expense of my grandpa’s retirement. See WaMu, 2008. I’ve been trying to come up with a fair “capitalist principled” plan to limit pay for CEOs who unethically drive their company into the ground. Well, one way to put the money they wasted back into our retirement accounts is to increase taxes on their unconscionable compensation.
It’s not fair that Warren Buffet’s secretary pays a bigger percentatge (33%) of her income in taxes than Warren (18%). Rich people have accountants, attorneys and advisors to manage their wealth. They shelter, level-load, invest and shift their money in order to pay the least tax on it. The result is that most rich people have an effective tax rate of 8 – 15%. Even after Obama’s raises their taxes, they’ll still be paying less than you!
Lastly, we need to raise taxes in this country. We are $10T in debt and that debt is not going to go down without raising taxes. (Spending is another issue altogether) Obama is taking advantage of the fact that rich people pay most of the taxes in this country and he is leveraging their ability to pay off the debt. The taxpayer bailout, economic policy and foreign policy that have promoted corporate and personal wealth are responsible for the nation’s debt. Obama is handing them the check – do not obstruct!