More on Taxing the Rich

With 2013 bringing tax increases on the incomes of a small sliver of th richest Americans, the country's top earners now face a heavier tax burden  than at any time since Jimmy Carter was president.

Annie Lowry, "Tax Code May Be the Most Progressive Since, 1979," New York Times, January 5, 2013

January  5, 2013 – In April 2011, I wrote the following verse.

Taxing the rich,
has this hitch.
You can never collect enough.
This is strictly off the cuff,
but you can't cover one year of D.C. spending,
and offset interest on other nations' lending,
by simply taxing the rich,
or chasing down the tax snitch.
That's the lesson of Laffer's famous curve,
The more you tax,the lesser the hor'd'oeurve.
Taxing 100% of incomes of $250,000 or more,
gets you 140 days for running the store.
Taxing all the profits of the Fortune 500,
gains you 40 days to cover IRS plunder.
Confiscating assets of all billionaires,
gives 30 more days to settle D.C. affairs.
That leaves 155 days,
On others’ taxes to raise.
Who are: guess who?

Well, now I can report that Obama got his way with the fiscal cliff deal, which raised rates on “the rich,” those making over $450,000.  Trouble is the deal raised rates on 80% of other Americans too.  Now Obama says he going to keep on hiking rates for the rich and everybody else, presumably until government gets so big it controls everything. 

When and where will the tax raising stop?  What happens is we run out of rich people? 

In a tongue-in-cheek WSJ piece “People Who Need Rich People.” Joe Queenan observes what would  occur if one could simply eliminate rich people.

 

•  The economy would cease functioning.as the rich would stop buying high price goods and hiring middle class workers.

·         Artists would no longer see sharks preserved in formaldehyde for $1 million apiece or 50,000 yards of  chartreuse tarps would not be stretched across the Grand Canyon. 

·         The yacht and private-jet industries would collapse.

·         The 4.6 million people employed in the hedge-fund industry would be on the streets.

·         No baseball player would get $25 million a year for 10 years.

·         The New York Giants and the Dallas Cowboys would cease to exist. 

·         We wouldn’t have somebody to vilify like Donald Trump. 

·         Lobbyists would be out of work.

·         Nobody would bankroll a film trilogy about  Hobbits.

Besides,  Queenan sadly concludes.

“Journalists wouldn’t have anybody left to despise.  They’d have to start blaming the middle-class for everything.   But the middle-class make a crummy bête noire. They make an even worse nemesis.  They never threaten to shutter factories.  They never try to buy elections…Middle-class people are completely useless as scapegoats.  They just don’t have the panache.”

Tweet:  Perhaps we can raise taxes progressively enough to make government big enough to do away with “the rich,” but then what?