Poor People Get Hammered by Tax Increases

By Dick McDonald
The Right Scale

In a tease to an IRS editorial article , the NYT states:

“Tax policy during the Bush years has greatly favored rich taxpayers at the ultimate expense of the poor.”

The tragedy of this statement is that it is repeated so often by Democrats and left-wing socialists in the MSM that even those who know better let the propagandists slide. Why dispute a leftist myth so ingrained in our literature and dialogue as to be the bedrock used to sway people to vote for Democrats. Strange thing is that most people in America are not “rich”. The “rich” are in the minority. So how is it that Republicans can get elected at all?

The answer to that question is just plain logic. Most citizens have come to realize that the rich have all the money they need. They really don’t need a tax cut. The poor need for the “rich” to get a tax cut. That’s right, the poor need the rich to get a tax cut so they will take that extra money and invest it the economy to make more and better jobs for “poor people”.

Poor people get hammered when government raises taxes. You see that means the rich don’t have the money to invest and grow jobs and the economy. As a result,the first casualties of tax increases are the poor. This simple fact has come home to the vast majority of Americans who have seen their lives improve during “tax-cutting” administrations. Instinctively, if not rationally they have come to realize the left’s mantra “at the expense of the poor” is purely that; a mantra of empty logic.

When citizens are freed from the socialist myth that government is the answer, the economy can soar. Government does not make money when people pay higher taxes, the government never makes money; it merely redistributes it in accordance with the prevailing opinions of special interest groups. Now if money is invested in the economy rather in the government, real growth and return is realized; and the socialist promise of full employment is attained by capitalism. By virtue of the constant job destruction and creation in our economy, 6% unemployment is considered “full employment”. Today it hovers around 4.9%.

The disaster of socialism in the last century is coming home to roost. Our Democrat lawmakers have promised more than they can deliver. They have triumphantly taken over 15% of the wages of all Americans for each’s person’s working life and spent or promised 20% upon retirement. As a result today we have a $13 Trillion unfunded liability to Social Security and Medicare and a $5 Trillion unfunded liability to city, county and state employees. Add to that the government guarantee of private pension which capsize and you begin to get the picture. Remember all the whining about our national debt; well folks, that is only $4.6 Trillion; not $20 Trillion.

The answer to this dilemma is being stonewalled by the left; simply because Democrats will lose their power to demagogue the poverty issue. You see privatization will take that 15% out of the government’s hands and invest it for each American in a growth fund. By virtue of the magic of compounding, even the poor will become wealthy after a 40-year working life. But the Democrats say we can’t have that, the poor made wealthy? What could be a more disastrous scenario for those donkeys. See www.thenewsocialsecurity.com for some real answers.

5 thoughts on “Poor People Get Hammered by Tax Increases

  1. I’m really surprised at this, Gary. This exceeds your usual outrageousness. This is tripe, pure and simple. Even as an opinion piece, it doesn’t have a shred of truth to it.Poor people want rich people to have tax cuts? Prove it. Show the world your evidence. Or apologize. This kind of extremism gives Republicans and conservatives the reputation for insensitivity they deserve.Howard


  2. Howard,It is called economics. First of all the article doesn’t say that poor people want rich people to have tax cuts. It says poor people NEED rich people to have tax cuts. There is a difference. If poor people really understood the economics of the rich getting tax cuts, they would support it.The facts are, Howard, that when rich people’s taxes increase, there is less spending on job creation and capital improvements. When rich people’s taxes decrease, the economy grows, jobs are created and capital expenditures increase.It is far from tripe. It is actual economics, and can be shown to work.It has nothing to do with insensivity, and does indeed have truth to it. I have nothing to apologize for. I will restate it. <>It benefits poor people when rich people get tax cuts.<>


  3. Gary,Economics? You mean trickle-down economics? Voodoo economics?Fortunately, that fiction was discredited in the 90s. Thanks, first, to GHW Bush with his tax increase, followed by President Clinton’s tax increase, combined with the sound monetary policy of Alan Greenspan and the Fed, Wall Street got the signal that the national government FINALLY was serious about reducing the runaway deficits foisted upon us in the Reagan years. That led to the boom years of the 90s, when we experienced the first budget surpluses in decades.Cutting taxes on the wealthiest Americans’ incomes just makes rich people richer. Voodoo economics didn’t work in the 80s, it’s not working now.Whatever you think poor people “need,” it isn’t another tax cut for for the rich.George Bush is the most profligate spender since LBJ. He has never met a spending bill he didn’t like or didn’t sign. AND he’s cut taxes AND he’s fighting a war. How irresponsible is that?Is this your idea of fiscal prudence? If it is, forgive me if I don’t listen to your prescriptions for what the poor need. I find your medicine hard to swallow.Respectfully,Howard


  4. Gary,Take a look at today’s op-ed piece by former Treasury Secretary Robert Rubin in the WSJ, titled “We Must Change Policy Direction.”Secretary Rubin brings cogent thinking to his prescriptions for the economy, and in doing so refutes your so-called solution for what the “poor” need. I quote:“The proponents of supply-side theory who assert that tax cuts will wholly–or even significantly– pay for themselves (through increased growth and federal tax revenues), appear to be no more accurate now than they were in the 90s. Then, they argued that tax increases included in [the Clinton] plan to address fiscal deficits were likely to lead to massive job loss, but what followed instead was the longest economic expansion in our history.”Earlier in his piece he writes:“…a study showed that in 1979 it took 44 people with average earnings in the bottom half of the population to equal each person in the top 0.1 of 1%, while in 2001, the last year in that study, that number was 160. Our economy is not working for too many people, and that is a problem for all of us.”Given this reality, I fail to understand how you can believe that cutting the taxes of the wealthy helps the poor, when the evidence points to the contrary.Howard


  5. Howard,Robert Rubin is bringing out the old liberal “raise taxes and spend more” philosophy. He is totally wrong. I suggest you read:< HREF="http://www.poorandstupid.com/2006_01_22_chronArchive.asp#113820517537657862" REL="nofollow">RUBIN’S REVISIONOMICS<> and < HREF="http://www.punditreview.com/2006/01/24/why-liberals-cant-be-trusted-on-the-economy/" REL="nofollow">Why Liberals can’t be trusted on the economy.<>Think about it Howard. If your employer suddenly got a windfall of money, and knew that windfall would repeat every year, would he spend money to expand his business? Would he create jobs? Would he make capital improvements? It is just common sense, and has been shown to work time and again.


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