American economy is taxing the rich the right move for economic recovery

Continue to article content The Republican tax plan is a scam—a massive and destructive financial giveaway masquerading as pro-growth tax reform. Which is why our first response must be to demand not one penny of tax cuts for big corporations and rich guys like me. In fact, if I were Benevolent Dictator, I would substantially raise taxes on myself and my wealthy friends. It is the only way to sustainably grow the economy, boost productivity, increase business opportunities, and create more and better jobs.

American economy is taxing the rich the right move for economic recovery

Email In a book, Benjamin Anderson tells the story of how a wealthy entrepreneur reacted to the imposition of much higher income-tax rates in at the bottom of the Great Depression. He had done it by a kind of activity particularly helpful and useful to the country He had taken many risks, knowing that many of them would turn out badly, but counting on a few of them to turn out well enough so that the profits on the successful ones would offset the much more numerous losses on the unsuccessful ones More than three-fourths of any profits which he might have [made] from a new venture would be taken away from him by income taxes.

The 1% are recovering from recession while 99% are still waiting | Business | The Guardian

Any losses which he might incur But further, if he should die, his estate would have to pay the federal government and to the state of New York How could an estate pay this tax if it were spread out in new ventures, in assets for which no ready market existed, in assets which could not be liquidated without great loss?

It was a painful thing to watch him turn his energies from creative production to consultation with tax lawyers as to how he could save as much as possible for his heirs. It was a painful thing to watch a vigorous man of fifty-five turning from creative activities to preparation for death He withdrew as far as possible from illiquid investments, and turned to investments of a high degree of liquidity.

Anderson then made a most pertinent observation: Right at the very bottom of the worst depression the country had experienced since its founding was an entrepreneur with capital and a willingness to risk it in an attempt to gain profits in ventures which, had they proven successful, would have hired the very people most dreadfully impacted by that depression.

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Instead, he withdrew from the markets altogether, and retired. He continued to enjoy a prosperous living, moving to his country estate to live out the remainder of his life. Certainly nothing to compare to the possible dozens, perhaps hundreds, of jobs his successful ventures might have created had he been allowed to make money by investing his money.

American economy is taxing the rich the right move for economic recovery

The potential for significant improvement in the lives of those he might have hired was simply eliminated altogether. Such are the perverse consequences of enforcing a philosophy of punishing wealth creators by redistributing their wealth to others in the name of fairness and equity and egalitarianism.

Economist Thomas Sowell spelled out the benefits of allowing wealth creators to take their risks, which are significant: Only some time later, if the business is profitable, does money return to the business owners — but in the absence of a profit motive … this activity does not occur.

George Reisman, in his Capitalism: A Treatise on Economics, explained the failure of such redistributionist attempts to spread the wealth from the wealthy to others: The workers of the early nineteenth century did not lack automobiles and television sets because the capitalists were keeping the whole supply to themselves.

There simply were no automobiles or televisions — for anyone. President Warren Harding knew that the restoration of an economy wracked by depression would be dependent precisely on those risk takers who, if they were allowed to, would be the engines driving the recovery from it.

American economy is taxing the rich the right move for economic recovery

The Depression of was the sharpest economic contraction in the previous years, with industrial production dropping by one-third and unemployment doubling from January to July Automobile production fell an astonishing 60 percent while wholesale prices cratered by nearly 40 percent.Much of the credit for this spectacular economic performance goes to the Economic Recovery Tax Act, which cut tax rates across the board for individ uals and reduced the tax burden on business.

Reagan made famous what he called the "economy pie." The economic pie represented the entire American economy. Reagan criticized government for taxing productive Americans to pay for every slice of pie that the government took and then used in ever more inefficient ways.

All of this slicing left. This pure Keynesian-type of program was augmented when William Phillips noted a statistical relationship between the rate of unemployment in an economy and the rate of inflation in that economy.

An act to amend the Internal Revenue Code of to encourage economic growth through reduction of the tax rates for individual taxpayers, acceleration of the capital cost recovery of investment in plant, equipment, and real property, and incentives for savings, and for other purposes.

Financial Information on the administration's financial stability, housing, and economic recovery programs. See how, when and where the stimulus money (and your hard. Apr 14,  · VARNEY: Well, there's a poll out, and it shows that -- the question was asked, did the Obama team's policies help or hurt the economy.

37 percent said it hurt the economy, has hurt.

A Zillionaire’s Solution: Tax the Rich and Save the Economy - POLITICO Magazine