We have heard Mr. Obama and other leading liberal Democrats talk about eliminating the Bush tax cuts. They have told us that all we need to do is raise taxes a little, especially on the "rich" so they will pay their "fair share". If we do this, we are assured the Federal government can spend all it wants, and these small tax increases on the "rich" will make the deficit problem will go away.
Unfortunately, as with most things Obama, this just isn't true. That is no problem for the liberal, of course, because those who reside outside Quadrant I have a more relaxed attitude toward "truth". Typically, they hold that "truth" is relative; it's what you feel now or felt at the time or it changes from person to person or is situational. (Does anyone know what is "is", anyway?) For those of us who hold to the traditional American views found in Quadrant I, however, truth is what corresponds to reality, and untruth is an issue.
I found a couple of articles which highlight the issue the other day. One is a UN study on the distribution of wealth in the year 2000, which showed that 1% of the world population owned 40% of the wealth, with about a third of that being in the United States. If that's true, by the way, then how is it that our Federal, state, and local governments can do such a bad job of managing money as to leave us with so much debt?
The next point is that 1% of the residents of the U.S. have accumulated over a third of the wealth in our country. This is mentioned several places on the internet, with one article suggesting that the top 1% have actually closer to 40%, with real control over much more.
If 1% of the population in America holds that much of the wealth of the wealthiest nation, then obviously, the solution is to tax the income of these folks so they will pay their "fair share", right? It makes for good political hay, but the facts don't support that position. You need to look at who this tax hike is really going to hit.
As it currently stands, while the poor often don't pay taxes, we also have many millionaires who have no tax liability. These individuals are invested in income-producing financial mechanisms which are tax exempt, such as municipal bonds, and they don't pay taxes. Tax hikes do not apply to tax-exempt income.
"Raising taxes on the rich" is, it seems, nothing more than a political ploy by the Democrats. Obama and his Democrat machine know the general public thinks of this group of the wealthiest of the wealthy, who currently are able to avoid paying much tax, when he says tax the rich. The tax code as it currently exists, however, is geared toward taxing primarily wage earners, and it leaves plenty of loopholes for the wealthy. They are, after all, a group which Obama wants to tap to raise his billion dollar campaign fund. What he really means is raising taxes on the earned income of successful small business owners. It is in essence a means of punishing those who have through hard work and innovation succeeded in the capitalist environment so alien to, and despised by, the Obama elite. When Obama and his socialist-leaning liberal Democrat companions say they want to " fairly redistribute" wealth, they mean taking the earnings of those more likely to be Republican, while keeping untouched the unearned income of those likely to support socialist ideology.
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