Let’s Tax the Rich

Yeah, that’ll work.  Let’s go with that.  And of course this has nothing to do with class envy.  No siree, Bob.

Here’s what happens when we tax those worthies.  When we hit up the Obama-rich, those making more than $250k per year (or those families doing better than $200k per year), we’re actually taxing small businesses, which are organized as LLCs, S-Corporations, partnerships, and so on, so that the business’ profits are passed through to the owners, who pay income tax on that money.  Businesses or their owners, though, including large businesses that nominally pay their own taxes, don’t actually pay those taxes; they just act as go-betweens between Uncle Sugar and their customers: those taxes are passed through as increased prices which their customers must pay to buy their product.

Thus, the benefit of taxing the “rich” is this: these business’ product prices will rise, leading to less buying, leading to slower growth and lower hiring—or reduced hiring from actually shrinking businesses—leading to more leisure time for us as we continue to be unable to find a job.

Here’s just one example of how that works.  In the ’90s, the Feds instituted a 10% luxury tax on yachts, ostensibly aimed at the really rich.  The American yachting industry virtually disappeared as a result, while the rich went on being rich.  As the President of the Institute for Policy Innovation, Tom Giovanetti, put it

The luxury tax didn’t hurt the wealthy.  It hurt the people that make things for the wealthy.

Sure.  The top 10% already pay 70% of the total income tax collected by the Feds while the bottom 50% of income earners pay around 4% of the total, so the rich plainly aren’t paying their share.  Raise the taxes on the rich.  That’s the ticket.

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