"....I am earning my own living, as every honest man must. I refuse to accept as guilt the fact of my own existence and the fact that I must work in order to support it. I refuse to accept as guilt the fact that I am able to do it better than most people - the fact that my work is of greater value than the work of my neighbours and that more men are willing to pay me. I refuse to apologise for my ability - I refuse to apologise for my success - I refuse to apologise for my money. If this is evil, make the most of it. If this is what the public finds harmful to its interests, let the public destroy me.This is my code - and I will accept no other. I could say to you that I have done more good for my fellow men than you can ever hope to accomplish - but I will not say it, because I do not seek the good of others as a sanction for my right to exist, nor do I seek the good of others as a sanction for my right to exist, nor do I recognise the good of others as a justification for their seizure of my property or their destruction of my life. I will not say that the good of others was the purpose of my work - my own good was my purpose, and I despise the man who surrenders his. I could say to you that you do not serve the public good - that nobody's good can be achieved at the price of human sacrifices - that when you violate the rights of one man, you have violated the right of all, and a public of rightless creatures is doomed to destruction. I could say to you that you will and can achieve nothing but universal devastation - as any looter must, when he runs out of victims. I could say it, but I won't. It is not your particular policy that I challenge, but your moral premise. If it were true that men could achieve their good by means of turning some men into sacrificial animals, and I were asked to immolate myself for the sake of creatures who wanted to survive at the price of my blood, if I were asked to serve the interests of society apart from, above and against my own - I would refuse. I would reject it as the most contemptible evil, I would fight it with every power I possess, I would fight the whole of mankind, if one minute were all I could last before I were murdered, I would fight in the full confidence of the justice of my battle and of a living being's right to exist. Let there be no misunderstanding about me. If it is now the belief of my fellow men, who call themselves the public, that their good requires victims, then I say: The public good be damned, I will have no part of it!" --- Atlas Shrugged
Taxing the rich more and more and more then even more seems to be the mantra of the left.. the deficit problems will be solved, they say, if you just make the rich pay more than they already are.
They say this while the top 50 percent of income earners already pay over 95 percent of all income taxes. They say this while 43 percent of Americans pay no federal income tax at all. They say that tax cuts for the rich are "giving" the rich more money, are "handouts" to the rich, neglecting the very fact that their money already belongs to the income earner and by not raising taxes they are simply stealing less from them.
They say this even though studies have found that the more Washington raises taxes, the more politicians spend and the deficit never gets paid down.
We've updated the research. Using standard statistical analyses that introduce variables to control for business-cycle fluctuations, wars and inflation, we found that over the entire post World War II era through 2009 each dollar of new tax revenue was associated with $1.17 of new spending. Politicians spend the money as fast as it comes in—and a little bit more.
We also looked at different time periods (e.g., 1947-2009 vs. 1959-2009), different financial data (fiscal year federal budget data, as well as calendar year National Income and Product Account data from the Bureau of Economic Analysis), different lag structures (e.g., relating taxes one year to spending change the following year to allow for the time it takes bureaucracies to spend money), different control variables, etc. The alternative models produce different estimates of the tax-spend relationship—between $1.05 and $1.81. But no matter how we configured the data and no matter what variables we examined, higher tax collections never resulted in less spending.
Washington spends more than they take in, but worse yet, when they raise taxes they don't bother using the additional income to pay off our $14 trillion debt, in fact, they spend even more than they raised in revenues by raising taxes in the first place, the whole time claiming the reason for doing it is to help with our debt.
Let us put all that aside though for a minute and go over the headline question and the thought processes behind the asking of said question.
Who Are You Gonna Tax When The Rich Fall Or Move Or Simply Quit?
The inevitable argument from the far left is "the rich won't fall" or "they won't move" or "they won't quit" but I have found that Google search is a wonderful tool, the problem is so many hits come up, so many tidbits of information that I am worried my browser will crash if I open any more, so I will list examples, link, close the tab then rinse and repeat.
Here we go.
When the Rich Fall: Argument from far left liberals is that the rich keep getting richer. Not true.
NRO quotes Treasury data:
***Income mobility of individuals was considerable in the U.S. economy during the 1996 through 2005 period with roughly half of taxpayers who began in the bottom quintile moving up to a higher income group within ten years.
***About 55 percent of taxpayers moved to a different income quintile within ten years.
***Among those with the very highest incomes in 1996 — the top 1/100 of one percent — only 25 percent remained in the group in 2005. Moreover, the median real income of these taxpayers declined over the study period.
**The degree of mobility among income groups is unchanged from the prior decade (1987 through 1996).
***Economic growth resulted in rising incomes for most taxpayers over the study period: Median real incomes of all taxpayers increased by 24 percent after adjusting for inflation; real incomes of two-thirds of all taxpayers increased over this period; and median incomes of those initially in the lower income groups increased more than the median incomes of those initially in the high income groups.
There’s a good deal of socioeconomic mobility in the United States — more than you’d think. Our dear, dear friends at the IRS keep track of actual households (boy, do they ever!), and sometimes the Treasury publishes data about what has happened to them. For instance, among those who in 1996 were in the very highest income group isolated for study — the top 0.01 percent — 75 percent were in a lower income group by 2005. The median real income of super-rich households went down, not up. The rich got poorer. Among actual households, income grew proportionally more for those who started off in the low-income groups than those that began in high-income groups.
Now let's use a real time examples of how states "assume" revenue they do not have yet, then are surprised and devastated when the rich fall.
California, New York, New Jersey, Connecticut and Illinois:
Nearly half of California's income taxes before the recession came from the top 1% of earners: households that took in more than $490,000 a year. High earners, it turns out, have especially volatile incomes—their earnings fell by more than twice as much as the rest of the population's during the recession. When they crashed, they took California's finances down with them.
Mr. Williams, a former economic forecaster for the state, spent more than a decade warning state leaders about California's over-dependence on the rich. "We created a revenue cliff," he said. "We built a large part of our government on the state's most unstable income group."
New York, New Jersey, Connecticut and Illinois—states that are the most heavily reliant on the taxes of the wealthy—are now among those with the biggest budget holes. A large population of rich residents was a blessing during the boom, showering states with billions in tax revenue. But it became a curse as their incomes collapsed with financial markets.
So, yes, the rich do fall and fall hard and when they do, states and countries that make themselves totally dependent on assumed future revenue from those very people, fall fast and hard right along side of them.
Then of course in the eyes of the tax and spend crew, it is not the fault of the states that assumed the rich couldn't fall, it is not the fault of the country that assumed the rich couldn't fail, it is not the fault of the tax and spend portion of our society that encouraged that line of thinking and fought to become totally dependent on the rich, no, somehow the fault for the fall in the their eyes is on the rich themselves.
When the Rich Move: Far left liberal argument "let them go!!! Good riddance" (My question- umm.. then who are you going to tax?)
We see stories of the rich moving away from high tax states into states that do not steal all their income in order to become overly dependent on those rich to support the whole state.
Example: Johnson family who runs Fidelity said goodbye to Massachusetts and helllloooooooooooo New Hampshire.
Why? So glad you asked.
New Hampshire doesn’t tax many forms of income from trusts.
New Jersey lost more than $70 billion in wealth between 2004 and 2008 as affluent residents moved elsewhere.
Findings from the Boston College report show that about 302,780 households left New Jersey between 2004 and 2008, only slightly lower than the 323,350 households that moved into the state. However, the average net worth of the departing households was about 70 percent higher, at $618,330.
Those who left were also more likely to be older and more educated, with jobs as entrepreneurs or in the finance and professional industries, the study found. Those replacing them tended to hold management or support jobs in the manufacturing industry. The study analyzed data from three main sources: The Federal Reserve’s Survey on Consumer Finances, the Census Bureau and the Internal Revenue Service.
Maryland lost wealth also by creating a special tax on rich people that was supposed to bring in $106 million. Instead, the state lost $257 million.
RCP:
New York billionaire Tom Golisano isn't stupid, either. With $3,000 and one employee, he started a business that processes paychecks for companies. He created 13,000 jobs.
Then New York state hiked the income tax on millionaires.
"It was the straw that broke the camel's back," he says. "Not that I like to throw the number around, but my personal income tax last year would've been $13,800 a day. Would you like to write a check for $13,800 a day to a state government, as opposed to moving to another state where there's no state income tax or very low state income tax?
He established residence in Florida, which has no personal income tax.
That is on a state level, what happens when when it becomes a "leave the country" problem instead of a leave the state problem?
Wealthy people have been quitting their American citizenship for tax reasons for years. Tennessee-born mutual fund investor John Templeton did it in 1968. He died in 2008 in the Bahamas at the age of 95. John Dorrance III, grandson of the founder of Campbell Soup (CPB), quit being an American, as did members of the Getty Family. Companies including Tyco (TYC) and Transocean (RIG) have done the same thing. Some worry whether the newest crackdown will encourage more taxpayers to quit the U.S.
When The Rich Quit or lose incentive, or slow down.
I read something at the end of last year but forgot who wrote it so it took me forever to find it again but finally I did. A firsthand account of how raising taxes on those that make more money than most, encourages them to work less.
In other words, taking his incentive away makes him offer less.
And I acknowledge that my motives in taking on extra work are partly mercenary. I don’t want to move to a bigger house or buy that Ferrari, but I hope to put some money aside for my three children. They will never lead lives of leisure, but I hope they won’t have to struggle to find down payments to buy their own homes or to send their kids to college.
Suppose that some editor offered me $1,000 to write an article. If there were no taxes of any kind, this $1,000 of income would translate into $1,000 in extra saving. If I invested it in the stock of a company that earned, say, 8 percent a year on its capital, then 30 years from now, when I pass on, my children would inherit about $10,000. That is simply the miracle of compounding.
Now let’s put taxes into the calculus. First, assuming that the Bush tax cuts expire, I would pay 39.6 percent in federal income taxes on that extra income. Beyond that, the phaseout of deductions adds 1.2 percentage points to my effective marginal tax rate. I also pay Medicare tax, which the recent health care bill is raising to 3.8 percent, starting in 2013. And in Massachusetts, I pay 5.3 percent in state income taxes, part of which I get back as a federal deduction. Putting all those taxes together, that $1,000 of pretax income becomes only $523 of saving.
And that saving no longer earns 8 percent. First, the corporation in which I have invested pays a 35 percent corporate tax on its earnings. So I get only 5.2 percent in dividends and capital gains. Then, on that income, I pay taxes at the federal and state level. As a result, I earn about 4 percent after taxes, and the $523 in saving grows to $1,700 after 30 years.
Then, when my children inherit the money, the estate tax will kick in. The marginal estate tax rate is scheduled to go as high as 55 percent next year, but Congress may reduce it a bit. Most likely, when that $1,700 enters my estate, my kids will get, at most, $1,000 of it.
HERE’S the bottom line: Without any taxes, accepting that editor’s assignment would have yielded my children an extra $10,000. With taxes, it yields only $1,000. In effect, once the entire tax system is taken into account, my family’s marginal tax rate is about 90 percent. Is it any wonder that I turn down most of the money-making opportunities I am offered?
By contrast, without the tax increases advocated by the Obama administration, the numbers would look quite different. I would face a lower income tax rate, a lower Medicare tax rate, and no deduction phaseout or estate tax. Taking that writing assignment would yield my kids about $2,000. I would have twice the incentive to keep working.
Now you might not care if I supply less of my services to the marketplace — although, because you are reading this article, you are one of my customers. But I bet there are some high-income taxpayers whose services you enjoy.
Maybe you are looking forward to a particular actor’s next movie or a particular novelist’s next book. Perhaps you wish that your favorite singer would have a concert near where you live. Or, someday, you may need treatment from a highly trained surgeon, or your child may need braces from the local orthodontist. Like me, these individuals respond to incentives. (Indeed, some studies report that high-income taxpayers are particularly responsive to taxes.) As they face higher tax rates, their services will be in shorter supply.
Reasonable people can disagree about whether and how much the government should redistribute income. And, to be sure, the looming budget deficits require hard choices about spending and taxes. But don’t let anyone fool you into thinking that when the government taxes the rich, only the rich bear the burden.
Read the entire thing over at NYT's Economy section.
Or the rich could simply choose to say the hell with everyone and simply close up shop, fire the millions they employ, take their money and leave and then who will those loony leftists tell their Democratic representatives to tax?
IMBECILES.
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