Tax the Rich and Then What?

By Heidi Harris
Monday, September 19, 2011

Radio listeners often think they have all the answers, (as opposed to hosts, who know they do) except when I ask these two very simple questions:

How much do we tax the rich? (percentage of income or dollar amount - I’ll take either answer)

Where does that money go to solve our deficit problem? (specific program, black hole known as the Treasury, etc.)

Warren Buffet has finally gotten his wish on taxation: “My friends and I have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice.”

President Obama is listening, and is now proposing a “Buffett Rule”. After all, the “the most fortunate among us...”, can afford to pay a “lil’ bit more”...right?

“Balanced approach”, “shared sacrifice”, “tax breaks for corporate jets”...no matter how you characterize it, it’s a war on the people who hire us and create things. The takers vs. the makers.

It always sounds good to those “less fortunate” to make those “more fortunate” pay all the bills, regardless of whether their lack of “fortune” is related to laziness, bad decisions, or anything else in their control. With the exception of inherited wealth, the “fortunate” have earned their money, through innovation and motivation.

When my husband and I discuss what to do with our money each month, these are the questions we are forced to answer. How much will be allocated, and where will it be allocated? Debt, savings, investments? If there’s any left, that is.

The New York Times said, “...restoring capital gains and dividend rates to the levels before the Bush tax cuts — when capital gains were taxed at a top rate of 20 percent and dividends were treated as ordinary income — would bring the Treasury an additional $340 billion over the next decade.”

And your point is...? That’s less than chicken feed, in a world where billion is the new million.

If Obama confiscated every dime of wealth from Bill Gates, Warren Buffet, and Steve Jobs, (none of whom acquired their wealth through luck), the amount wouldn’t even cover the debt that’s increased under Obama’s watch, let alone balance the budget. And I wouldn’t be any better off than I am now.

Not to mention the detrimental effect such a policy would have on American innovation and competitiveness.

It goes without saying that all of us should be able to keep as much of our earnings as possible. Sure, it costs money to pay for fire fighters, police officers, roads, etc., but do they have to costs as much as they do?

Can we afford to keep dumping endless money into an education system that isn’t effective? High speed rail lines to nowhere? Employing government workers whose job descriptions are vague at best? Of course not, and those problems won’t be solved by fleecing the rich.

I’ll make the “take it from the rich” crowd a deal. Since you’re so much smarter than the rest of us, let’s see if you can answer my two simple questions: How much? And where does it go? If not, keep your hands off money you didn’t earn.

You can’t be trusted with it.