class warfare

Here are seven reasons to oppose tax hikes

We’re often told by the Left that all we need to do to solve our budget shortfalls is to raise taxes. But is that really the right course? In a new video from the Center for Freedom and Prosperity, Piyali Bhattacharya (Young Americans for Liberty) gives us seven reasons to oppose higher taxes hikes. The reasons range from the fact that tax hikes encourage more spending and discourage economic growth to how they encourge loopholes in the tax code and undermind competitiveness.

Redistribution of grade point averages

Here is a clever video of a guy trying to get signatures for a petition that would redistribute the GPAs of the most achieving students to those with lower grades. Apparently, most of the kids in the video support higher taxes on the rich. They say it’s “not fair” to redistribute their GPAs since they worked hard for their grades, but they apply a different standard when money is involved despite the fact the wealthy worked just as hard for what they’ve earned; nevermind that taxing them isn’t going to solve our budget problems.

The not-so-plentiful “national resource”

Michael Moore has argued that wealth is a national resource that should be taken back to foot the bill for all the programs and ideas that he and his ilk believe will make America better.  But will it really?

This video points out how difficult it will be to actually do like Moore suggest:

It definitely brings up some valid points about how difficult it would be to fund everything this nation seems intent on paying for.

H/T: The Liberty Papers.

Income inequality

Over at RedState, there’s an interesting post about alleged income inequality and unfairness that is pretty good.  The points are well documented and worth a read.  There were a couple of points I wanted to talk about specifically though.  I agree with the writer’s points, but there’s some other comments to add.

For example:

In the March 2nd NYT, Robert Frank invokes the spectre of inequality, this time in the guise of a so-called “toil index”.  The interesting (and silly) aspect of Frank’s assertions is the idea of using “family goals” as an indicator of the “cost” of inequality.

The index rejects the standard economic assumption that well-being depends primarily on absolute consumption. Instead, it assumes that the context of that consumption is often far more important. Context matters because the brain requires a frame of reference to make any evaluative judgment.

For example, is a particular family’s house adequate? The answer invariably depends on the quality and size of other houses in the surrounding area.

Rising inequality has shifted the context that governs housing choices. Higher incomes at the top have led the wealthy to build bigger mansions, shifting the frame of reference that shapes demands for those with slightly smaller incomes, who travel in overlapping social circles. The near-rich respond by building bigger houses as well, shifting the frame of reference for others just below them, and so on, all the way down the income ladder.

Economics, Class Warfare and the Washington Blame Game

It would be comic if it wasn’t so pathetically tragic. On Tuesday, President Barack Obama stood at the White House to give a press briefing to reporters concerning a compromise deal cobbled together between the president and the Republicans. Just over two years ago this man soaked in the adulation of tens of thousands as he stood before the cheering, weeping, fainting throngs who saw him as a modern-day messiah. Indeed, he seemed to think of himself as such, proclaiming his nomination would be remembered by history as the “moment when we began to provide care for the sick and good jobs to the jobless; this was the moment when the rise of the oceans began to slow and our planet began to heal; this was the moment when we ended a war and secured our nation and restored our image as the last, best hope on earth.”

Alas, he made a fatal mistake. He believed his own hype. Now, with our illustrious Community-Organizer-in-Chief still reeling from the fact that his personal charm and charisma has not ended the war our nation is engaged in (or even closed Guantanamo), his economic policy has been disastrous and has actually increased unemployment, and the planet still has a long way to go to be healed, To top it off he has been handed the worst electoral defeat in more than half a century, losing more than 60 seats in the House to give Republicans control. The sobering reality that he is a mere mortal must be stunning to him.

Serfdom in the 21st Century

Whether talking about the extension of the 2001 and 2003 Republican tax cuts, or the reinstatement of the death tax, all too often we look at the symptoms and ignore the underlying problem. That problem is one of philosophy; namely, are we sovereign citizens who have delegated limited powers to our government in order to have it perform specific functions at our direction? Or are we subjects to government, and therefore bound to be obedient to the dictates of that government regardless of how unfair or intrusive?

Regarding the extension of the current tax rates, Democrats have repeatedly said that it is not a tax increase, but a return to previous tax rates. From that perspective I guess, unemployment rates have not increased, but simply returned to what they previously were at the start of the Great Depression. And abortion isn’t ending a life, it is simply returning to a previous state of non-pregnancy. It requires a unique talent for mental contortionism to say these things with a straight face. Most people understand though, that if you pay more taxes this year than last year, it’s a tax increase.

Democrats also just passed a bill in the House that would allow the tax rates for the evil “rich” to go up, and keep only those tax cuts for the middle class. This is also confusing though, because for nearly a decade we’ve heard the endless refrain that the “Bush tax cuts” benefited only the rich and did not help the middle class. How is it possible to extend tax cuts for the middle class when only the rich received them?

Many a liberal has stated that the rich should pay their “fair share”, yet to do so would require a drastic decrease in the tax rates. Currently, the top 1% of income earners pay around 40% of all income taxes, the top 5% pay about 95% of income taxes, and the bottom 50% pay no income tax at all. By my reckoning, the rich are paying far more than their fair share.

Pelosi open to extending tax cuts on high income earners?

While President Barack Obama is continuing to push Congress to allow tax cuts for the job creators in our economy to expire, Speaker Nancy Pelosi is supposedly leaving the door open to extending them:

The California Democrat, speaking in the same room House Minority Leader John Boehner (R-Ohio) appeared in earlier in the day, said that the “only thing I can tell you is the tax cuts for the middle class will be extended this Congress,” leaving open the possibility that cuts for people making more than $250,000 could be extended at some point, too.

“What I believe the American people deserve is a tax cut for the middle class,” Pelosi said. “And without getting into procedure and timing and process, what we’re going to do is to say at the end of the day the extension of the Obama middle-income tax cuts will take place, and that’s what I have to say on the subject.”

Of course, Pelosi would rather incite class warfare and use the force of government to take away what people have earned, essentially penalizing them for success. She also repeats the tired and misleading lines that the tax cuts have hurt the economy. Writing at the Fiscal Times, Gerald Prante and Bill Ahern from the Tax Foundation take down some of the claims that Pelosi and her colleagues make when it comes to the tax cuts:

Failing to renew tax cuts will hurt middle class

In a column at the New York Post, Dan Mitchell explains that soaking the rich in taxes will hit hurt the middle class:

The Obama administration’s approach is to look at tax policy mainly through the prism of class warfare. This means that some of the 2001 and 2003 tax cuts can be extended, but only if there is no direct benefit to anybody making more than $200,000 or $250,000 per year.

That’s bad news for the so-called rich, but what about the rest of us? This is why the analysis about direct and indirect costs is so important. The folks at the White House presumably hope that we’ll be happy to have dodged a tax bullet because only upper-income taxpayers will face higher direct costs.

But it’s the rest of us who are most likely to suffer indirect costs when higher tax rates on work, saving, investment and entrepreneurship slow economic growth. When the economy slows, that’s bad news for the middle class — and it can create genuine hardship for the working class and poor. Indeed, punitive taxation of the “rich” is one reason why middle-class people in high-tax European welfare states have lost ground in recent decades compared to Americans.

The White House may be playing smart politics by engaging in class warfare, especially if President Obama succeeds in blaming the recession on tax cuts that took place five years before the downturn began. But for those who care about prosperity more than politics, what really matters is that the economy is soon going to be hit with higher tax rates on productive behavior.

Top 1% pays more in taxes than bottom 95%

New data released by the IRS shows that the tax burden on the top 1 percent of income earners now exceeds the tax burden of the bottom 95 percent.

Scott Hodge at the Tax Foundation says, “To put this in perspective, the top 1 percent is comprised of just 1.4 million taxpayers and they pay a larger share of the income tax burden now than the bottom 134 million taxpayers combined.”

Tax Foundation Chart

Census Douses Liberal Claims

Cato has summarized the 2007 Census data that was released earlier this week. While United Liberty of all political blogs will readily admit there are major problems with our economy - problems that stem from both fundamental policy choices & execution of policy - we need to make sure we do not play into the hands of the raging liberals who exaggerate every problem in society in order to achieve their political goals. Even looking at the situation from a non-ideological and pragmatic viewpoint, there is not any more reason to intervene in the economy today than there was a decade ago.

New Income and Poverty Figures Spoil the Pity Party
  • The number and percentage of Americans without health insurance actually declined slightly in 2007 compared to 2006. The share without insurance in 2007, 15.3 percent, is actually lower than it was a decade ago.
  • Median household income is not falling: “Between 2006 and 2007, real median household income rose 1.3 percent, from $49,568 to $50,233—a level not statistically different from the 1999 prerecession income peak.”
  • The share of households earning a middle-class income of between $35,000 and $100,000 in real 2007 dollars has indeed shrunk slightly compared to a decade ago, but so too has the share earning less than $35,000 a year, while the share earning more than $100,000 continues to rise. The middle class is not shrinking; it is moving up.
  • The 12.5 percent of Americans living below the poverty line in 2007 was statistically unchanged from 2006, and remains below the 13.3 poverty rate in 1997. The poverty rate has been trending downward since the early 1990s during a time of growing trade and immigration flows.
  • The Gini coefficient, a statistical measure of income inequality, was .463 in 2007, down slightly from earlier in the decade and virtually the same as it was a decade ago.


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