My Facebook feed is now largely composed of Libertarian/defectors of politics posts. Hopefully most people know the SOTU is tomorrow, and there is some serious discussion on my feed as to whether the supposed tax breaks for the middle class by increasing taxes on the rich is moral. Here is a comment and answer I found to be very interesting, especially #3 & 4 of the reply…. Comment: I support the Presidents proposal! Middle-class Americans and especially an unmentioned group, the poor, need a tax break! Wealthy people can afford to pay higher taxes, and even if they do, theyll still be rich! In this lousy economy of which greedy people are one of the causes, common citizens have gone too long without a helping hand! You Libertarians are significantly to blame for that! You people praise the rich regardless of how they acquired their wealth, and you oppose any measure that helps the poor! You vilify the poor for their circumstances which, in many cases, arent their fault! Its time for those who degrade the poor, once and for all, to be ignored! This country must be led according to Democratic values! Response: So let us consider fair share. 1. A capital gains tax applies just as much to the small family business as the Wall Street Banker. So when the husband/wife go to sell their business and retire, they will have to pay that tax rate in capital gains. It is easy to say tax them at 90%, but this means your neighborhood automotive mechanic who, after 30 years in business, goes to sell for say, $1 million will only get $100,000 to retire on, despite growing the business, hiring people, and doing all the right things. 2. The small business owner (or those in private practice, like doctors) is frequently in the range between $100,000~$500,000 in income. At the midpoint ($300k), if they pay the much despised 15%, they are paying $45,000 in taxes. The median household income in the United States is $42,000. So even at 15%, that small business owner, doctor, lawyer, or other professional will pay more in taxes than the entire household income of the median family. 3. According to the IRS, the upper quintile is composed of those making $67,000 and up. You read that correctly...$67k puts you in the top 20%. That top quintile pays 85%~90% of ALL income taxes collected by the government. In other words, those making $67k or more already pay nearly 90% of the bills...but only get 20% of the say in how/where that money is spent. 4. According to the liberal Citizens for Tax Justice, implementing the so-called Buffett Rule and taxing the uberwealthy at 30% would raise $50 billion per year. A lot of money for sure...but lets put it into perspective. The Federal Budget is $3.9 trillion, or 3,900 billion. So that added revenue amounts to only 1% of the Federal Budget. Its not going to single handly fix the deficit, the debt, the infrastructure issues, or anything else. 5. Raise the rates and many of the wealthy will simply leave. Dont think so? The French raised the tax rate to 75% and the wealthy left in droves. The most French city in the world is now London. Money spends just as easily in London or Brussels or Bangkok as it does in New York. They dont need to stay here if its going to cost them a fortune. So...what constitutes fair share?
Posted on: Tue, 20 Jan 2015 04:35:28 +0000
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