Tax Increases: For the Rich or For Me?

A friend recently said, “If it is between tax increases for the rich or tax increases on me, I’ll take tax increases for the rich every time.”  I agree if the only two choices we have are tax increases for the rich or tax increases for me.  If tax increases on the rich would solve our debt problem, help the economy grow and/or reduce unemployment, I am all for it. 

Unfortunately, as explained in my blog post “Will Taxing the Wealthy Bring Back Prosperity?” taxing the wealthy will not do any of these things, in fact, it will make the problems worst.   President Obama wants us to believe that it was tax increases early in President Clinton's first term that led to the 90’s boom, when in fact it wasn't until welfare reform, and especially the capital gains tax rate reduction that the economy boomed.

President Obama said not raising taxes on the wealthy violates core principals he campaigned on, while Republicans have “ideological positions that don’t make much sense”.    I agree the current Republican leaders don’t make much sense, considering their proposals will do as little as Obama’s proposal to solve our Countries problems, but it is Obama’s position that is ideological.  He blindly insists on raising taxes when the evidence shows raising taxes will hurt, not help the economy. 

Another problem during the current fiscal cliff negotiations is both Republicans and Democrats talk like tax cuts are a cost to the Government when in fact Tax cuts will not necessarily “cost” the Government anything as explained in my post “Tax Cuts Don't"Cost" the Government”.  In fact, tax revenues went up when tax rates went down, as far back as the Coolidge administration.

As long both parties continue to promote the false argument that tax increases are necessary, and the only disagreement is how much of an increase is required and who will pay that increase, we will be left with an unnecessary choice of tax increases for the rich or tax increases for the rest of us.