Soak the Rich!
Been there. Done that. Bought the Bernie Sanders Scooby-Do tee shirt. It doesn't fit.
I'm beginning to see posts – some from people who should know better - recycling the same themes I see every so often, and they get dumber every time I see them.
Most of the time they involve a desire to eat the rich, this year’s targets are Elon Musk, a former darling of the left and he and Trump’s “billionaire friends”. I wish I could write “billionaire” the way Bernie Sanders says it, because it sounds so Scooby Do evil when he does it, but I just can’t translate that into text!
These are posts by leftist lunatics who have no idea how taxes work and that there is a limit beyond which tax revenue actually falls when the rates increase. They are campaigning for the return of the halcyon days when top rates went to over 90%, so they can "soak the rich".
Well, it didn't work when the rates were that high.
Why?
Nobody in their right mind paid for them.
Rather than give their wealth away to the government, the wealthy simply shifted their liquidity into tax-free municipal bonds or other tax-free government instruments.
A few years ago, Thomas Sowell, a national treasure who deserves a Presidential Medal of Freedom, wrote that literally nobody paid the 91% rate:
"We have seen this movie and it premièred in 1921 – the “rich” won’t stop working but their capital will:
Ninety years ago — in 1921 — federal income tax policies reached an absurdity that many people today seem to want to repeat. Those who believe in high taxes on “the rich” got their way. The tax rate on people in the top income bracket was 73 percent in 1921. On the other hand, the rich also got their way: They didn’t actually pay those taxes.
The number of people with taxable incomes of $300,000 a year and up — equivalent to far more than a million dollars in today’s money — declined from more than a thousand people in 1916 to less than three hundred in 1921. Were the rich all going broke?
It might look that way. More than four-fifths of the total taxable income earned by people making $300,000 a year and up vanished into thin air. So did the tax revenues that the government hoped to collect with high tax rates on the top incomes.
What happened was no mystery to Secretary of the Treasury Andrew Mellon. He pointed out that vast amounts of money that might have been invested in the economy were instead being invested in tax-exempt securities, such as municipal bonds."
But you know who does pay?
The middle and lower classes who pay the price increases that are necessitated to cover corporate taxes and the increased in interest rated driven through government borrowing and the hidden inflation of a devalued currency.
They get hit, not the “rich”.
If the Nobel people cared about brand value, they would take the prizes away from Barack Obama and that idiot Paul Krugman immediately. These two are seriously bringing the prestige of the Nobel organization to its knees.
Every time you write Krugman, I read Keynes. Keynesian economics appeared to work when first started but then rapidly ran out of steam kinda like Marxism.
The main problem, to my observation over decades, is that when politicians start bloviating about making the rich pay their “fair share”, it is never very long until “rich” is defined as “anybody with a job”, while the actual rich have long since become non-resident for tax purposes.
Thousands of years ago, Lao Tzu advised the Emperor of China. Two pieces of his advice have always stuck with me. First, he told the Emperor to not take more than ten percent of the people’s output in taxes, as that would prevent unrest, discontent and rebellion. A tenth was a fair share. The other thing he said was that running a big country is like cooking a very small fish - if you poke it too much, you’ll ruin it. Western governments nowadays are nothing BUT poke, poke, poke, poke, poke.