Monday, March 14, 2011

"Tax the Rich!!!" (Sorry. That Doesn't Cut It)

Although what's outlined here is not exactly news (Les Aspin knew and taught this before he went to Congress), it's worth repeating.

Here's Part One:

...There are lots of liberal definitions of “rich.” When Pres. Barack Obama talks about the rich, he’s talking about people living in households with income of more than $250,000 or more, the rarefied caviar-shoveling stratum occupied by the likes of second-tier public-broadcasting executives, Boston cops, nurses, and the city manager of Lubbock, Texas (assuming somebody in her household earns the last $25,000 to carry her over the line).

Club 250K isn’t all that exclusive, and most of its members aren’t the yachts-and-expensive-mistresses types. Nonetheless, there aren’t that many of them. In fact, in 2006, the Census Bureau found only 2.2 million households earning more than $250,000. And most of those are closer to the Lubbock city manager than to Carlos Slim, income-wise

Got that part? Good.

...say we wanted to balance the budget by jacking up taxes on Club 250K. That’s a problem: The 2012 deficit is forecast to hit $1.1 trillion under Obama’s budget. (Thanks, Mr. President!) Spread that deficit over all the households in Club 250K and you have to jack up their taxes by an average of $500,000. Which you simply can’t do, since a lot of them don’t have $500,000 in income to seize: Most of them are making $250,000 to $450,000 and paying about half in taxes already...

Ruh Roh. Looks like the simpleton D/LeftOWacky tax wizards have a problem.

And, in fact, they do! Here's the runup:

So, what about Lloyd Blankfein and Charlie Sheen and Tiger Woods? What about these people? You can tax the striped pants off of them, but you won’t get enough money to balance the budget. If you’re doing it, you’re probably mostly doing it because it feels good. (And, yes, that does make you a bad person.)

Besides that, Blankfein, Woods, and Sheen have lawyers. More lawyers than Foley and Lardner has. You'll find those guys (and gals) in some tropical-no-tax-here haven in about the time it takes for them to fire up their G-5's and point south.

In the end, you can't get there from here:

So, how about taxing people who make less than $250,000? That’s probably whom you want to tax, since they are the ones who have the money (Counterintuitive, I know.) The Bush “tax cuts for the rich” cost the Treasury about $800 billion in forgone revenue; the Bush tax cuts for the middle class cost trillions – 2.2 of them, to be precise.

Repealing all of those Bush tax cuts, for rich and middle class alike, gets you about $3 trillion — over ten years. The deficit is running from a third to almost half that every year. Will not balance. Does not compute.


"Balancing the budget" calls for TRIPLING Federal taxes on anyone earning money. (Don't forget that you also will be paying State taxes, folks.)

So. We can cut spending, or we can triple taxes on everyone.

Have a preference??

HT: Ace


Anonymous said...

"We can cut spending, or we can triple taxes on everyone."

Everyone? I think you meant 2.2 million upper earners.

Dad29 said...



Jim said...

I don't know ANYONE who has suggested that we can end the deficit ONLY by raising taxes, much less raising taxes only on the wealthy.

"you have to jack up their taxes by an average of $500,000. Which you simply can’t do, since a lot of them don’t have $500,000 in income to seize"

Apparently you are not familiar with the concept of "average".