Do the numbers matter?

Is the aim to improve the economy or punish the wealthy?

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There are two frauds being perpetrated on an apparently willing public today in the discussion over raising taxes.

The first is the canard that the federal government is the same thing as the American economy – that to help the economy, we must feed the federal government more in taxes.

That’s just unalloyed lunacy. The government is not the economy. And it’s indisputable that the more the government takes out of the economy, the less money there is in it.

Just remember, when you hear someone touting higher taxes as a means of fixing the economy: The government and the economy are not the same thing.

The second ruse being foisted on you is that higher tax rates on the wealthy is about the math.

Syndicated columnist Charles Krauthammer makes this point elsewhere on this page when he writes, “It has nothing to do with economics or real fiscal reform. This is entirely about politics. It’s Phase 2 of the 2012 campaign.”

His point: The president’s own deficit reduction commission cited $1.1 trillion a year in tax loopholes and deductions that could be used to bring in more revenue without raising tax rates. If the government succeeded in snaring but 1 out of 10 of those dollars, it would raise $1 trillion over 10 years.

In other words, Krauthammer argues, it is a political ploy and sheer economic fiction that the only way to raise such tax revenues is to increase rates.

It is clear from observing this president and listening to his own words that he is more focused on punishing the successful than on balancing the budget.

Exhibit A: He admitted in a primary debate in the 2008 election campaign that he’d like higher capital gains tax rates as a matter of fairness – even if they brought in fewer dollars, as has historically happened.

Dan Mitchell of the Cato Institute think tank in Washington also seems to suggest the president’s tax-hike proposal for the rich is more about politics than economics.

“Obama’s main goal in the fiscal cliff negotiations is to impose a class-warfare tax hike,” he was quoted Wednesday.

In short, the president’s position is less about the math than it is about trying to referee life’s haves and have-nots. What he said in the 2008 campaign to “Joe the plumber” about spreading the wealth around? He meant it.

This is not about numbers as much as it is about ideology. This president seems to believe it’s his job to make life fair – which, of course, presupposes knowing what is and isn’t fair. He’s more concerned with moving items around on a balance sheet to fit his world view than he is on making the columns balance.

Agree with him or disagree. But just understand what’s really at work. It’s not about the math.

To paraphrase James Carville’s old mantra, it’s the politics, stupid.

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allhans 12/08/12 - 03:16 pm
DanK I didn't realize that

DanK I didn't realize that other nations could vote for an American president. I missed that one when it was passed.
It seems only natural to me that other leaders don't want to make a change.
And then take a Look at Morsi..he was elected with many cheers by the people, endorsed by other countries and what do they have. An utter and complete mess.

allhans 12/08/12 - 03:19 pm
Howard Dean, one of the most

Howard Dean, one of the most dedicated liberals of all time had it right when he said every person should pay Federal income taxes. If someone receives a welfare check, tax it. No exceptions......

nofanofobama 12/08/12 - 06:04 pm
How does one transfer wealth

How does one transfer wealth from the poor who by definition has no wealth to the rich.? It is also a myth that all the rich are republican ..ever heard of soros, gates, Buffett and Moore just to name a few.. There plenty of wealthy business people who love big govt..all obumlers fund raising wasn't done down at the local coffee shop
, seems like he made plenty of trips to New York , Hollywood , Vegas at the expense of the taxpayer.

TrulyWorried 12/08/12 - 07:37 pm
A question

that may, or may not, start a discussion about some more of our money. We are or have been paying into Social Security. I believe the government calls it "entitlements" - it should be called
"earned benefits" - we paid for it throughout all the years that we worked and paid into it. I hope those funds won't be touched!!

allhans 12/08/12 - 09:50 pm
Means testing will likely be

Means testing will likely be done in the near future. Otherwise, Social Security will probably stay about the same.

Bizkit 12/09/12 - 12:12 am
Well Dank is correct about

Well Dank is correct about some not paying taxes but it is less than 1% of the 1% that aren't (something like 1500 )-the vast majority of the wealthy pay their progressive tax rate. It is a false argument. There is no transfer of wealth-except to govt. And now from govt to who they pick as winners. Sad really.

mikesaul 12/10/12 - 09:15 am
"Corporate Welfare" is a misnomer!

"Corporate welfare" involves the corporations receiving RETURNED funds which they have previously PAID in to the system in one form or another. The only companies that receive more from the government than they pay in are those the government picks and chooses to SAVE from self-inflicted collapse (GM, Solyndra, Fisker, etc.). Social welfare, however, is almost exclusively going to those who pay ZERO into the system, in ANY form!

Receiving a tax refund of monies you paid is not welfare. Conversely, receiving monies you NEVER paid is NOT a tax refund, but is a welfare payment and a redistribution!

Additionally, businesses provide jobs. A company with 10 stores that employs 1000 people at $25000/year needs to grow its income/earnings/profits by nearly double that in order to add even a single new job to its existing structure. If it wants to expand by adding a new store to employ another 100 people would need have enough profits to actually cover the purchase of the properties, equipment, construction, as well as the nearly $50,000 per new employee in order to complete that expansion! Yes, most companies never spend their ENTIRE profits on adding new employees, but that is because the companies are in the business to MAKE MONEY, just as the employees are working to MAKE MONEY. Now, if those employees to a hint from their employers and SAVED some of their earnings as the companies do, they, too, would have additional WEALTH for the future!

If you take away the corporate profits, either by increased taxing of mostly already taxed earnings, or by eliminating their ability to get tax breaks to allow new construction/expansion, etc., you will simply be eliminating their ability to create new jobs.

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