Funny Email I got.......

Discussion in 'The Bench' started by Mike Atwood, Jan 19, 2003.

  1. John Chapman

    John Chapman Well-Known Member

    Steve, perhaps you're correct, yet the effect of a particular executive or legislative proclivity in the way public funds are spent has a distinct impact on how business responds with respect to spending.

    This sounds remarkably like the diatribe frequently espoused in the mass media and a favorite oldie goldie of the liberal politicians. In practice, it is one of the many divisive tactics the liberal contengent uses to foster descrimination (politically correct hypen-Americans, etc; class warfare (rich vs. poor) and institutionalization of victimization to advance their agendas.

    Tax cuts frequently 'favor' the rich, because they pay more taxes under our graduated tax structure. What the chant above overlooks when it's presupposed that the poor get screwed on tax cuts, is that the bottom 20 percentile of income earners pay almost no tax as it is and with tax credits, actually come out ahead in the game. In fact, for 1996 (a Clinton year, coincidentally)... the last year I could get numbers on quickly, the bottom one half... 50% of taxpayers accounted for only 4.3% of personal income tax revenue. At the other end of the scale, the top 5% of income earners accounted for very close to 51% of all personal income tax revenues... and the top 1% alone paid 32% of the total bill. It stands to reason when taxes are cut, these folks will see the larger dollar change. While I'm certain that there are solid cases of folks making millions and paying no taxes, in the total reality, it just doens't happen.

    The intriguing thing is about tax cuts, is when high end personal and corporate taxes are cut, there usually follows an increase in total tax revenue. Howszat?!! Simple, really. Rich folks don't get and stay rich being stupid. They're going to legitimately minimize their tax burden (no law says you have to pay more than required, right?) and the same for corporations. If you reduce the tax on dividends, capital gains and inheretance, it removes one of the key impediments to more efficient uses of the capital involved. More to the point, reducing taxes lowers the cost of moving the money to more productive investments... which produces more taxable income, albeit at a lower rate... but, some of more is frequently better than a lot of not much.... Oh, and in this process, more jobs are created.

    As for fiscal responsibiltity and the deficit... who'd have forseen the economy going in the dump for three years. Reduced personal and corporate incomes yield less tax revenue.

    Just my two cents worth.

    JMC
     

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