Un-Liberaled Woman

If you tax it, they will run.

That’s my new mantra to argue back at liberals who somehow miraculously forget that at the end of the day people are inherently selfish and will do within their means possible to avoid threats to their well-being INCLUDING the money they EARNED. It’s like I get it because remember I used to be a liberal. Liberals honestly think who can argue with the concept, “well if you tax more on people who can afford higher taxes then you’ll get more tax revenue and then you won’t have to tax those who make less.”

Yes, great in theory. BUT it’s in theory only that it makes any sense. Keep in mind, sitting from a comfy non-application couch in academia constrains one to not understand how this theory is easily debunked in what I like to call – The Real World.

The problem is that most liberals only look at one side of the economics picture. They only see how supposed increased taxes will mean more revenue for the government. They see the economy as static, not the truth in that our economy is dynamic adapting to new parameters to the corporate environment. Unfortunately liberals don’t look at the affect taxes have on the economy, on venture capitalism, on business development, on R&D, on company employment, etc. They just look at the idea (remember IDEA only) of theoretical increased revenues for expanded failing government programs. Looking at just one side of the entire economic picture when it comes to tax policy is what Henry Hazlitt calls bad economics. It would be the same if a company would increase prices on products and argue “hey, if we increase prices, that’s more in profits” but then they don’t look at the affect of less demand due to higher prices. They just assume the demand/revenue will remain static still being there willingly adapting to the price increases.

See when you tax those who invest the capital in this country, run businesses, etc. they for some reh-reh-reason don’t like it. No matter how much Smancy Pelotox gets up there and says “You’ll take this tax hike and you’ll LIKE it!” people are going to shift their money to avoid the most taxes possible because they already pay the majority of taxes.  And to the liberal bonehead argument “well, Obama is going to tie up the loopholes people use to hide their taxable income.” Newflash nitwit – there are always going to be loopholes. A loophole is not something a President Unicorn Princess can make disappear with a flick of his wand, ie teleprompter. No, a loophole is something people pay a tax lawyer hundreds of dollars by the hour to find or have their tax return fit into. And the tax code makes it easy by being ridiculous in length and treated as a living document – no, THANK YOU Democrat Charlie Rangel!

Also to further illustrate the fallacy of liberal tax theories, all you have to do is look at the history of tax collections. (via The Heritage Foundation)

Good tax policy has a number of interesting side effects. For instance, history tells us that tax revenues grow and “rich” taxpayers pay more tax when marginal tax rates are slashed. This means lower income citizens bear a lower share of the tax burden – a consequence that should lead class-warfare politicians to support lower tax rates.

I know, how silly of me to look at the revenue statistics and research studies of actual tax policy application (and NOT tax theory studies), but according to the Tax Foundation tax breaks to the lower income earners actually hurts revenues for the government. But tax breaks for the top income earners (and those paying nearly 80-90% of ALL tax revenue) does spur on economic growth, thus improving tax revenue gains for the government. By the way, take a look at the study and note the words “actual experience of taxpayers”. Again, that pesky logic and application coming into play.

As Jack Bauer would say – DAMMIT!

A recent study analyzed the actual experience of taxpayers as tax rates were reduced in 2001 and 2003. This empirical study found that lower tax rates helped to reduce the distortions in economic decision-making caused by high tax rates. Moreover, the lower tax rates induced taxpayers to report more taxable income, which means that a sizable portion of the revenue cost of the lower tax rates was offset by a tax-induced expansion of the tax base.

And as if you need even further proof, Ace of Spades throws it up this morning from an article in The Wall Street Journal:

And the evidence that we discovered in our new study for the American Legislative Exchange Council, “Rich States, Poor States,” published in March, shows that Americans are more sensitive to high taxes than ever before. The tax differential between low-tax and high-tax states is widening, meaning that a relocation from high-tax California or Ohio, to no-income tax Texas or Tennessee, is all the more financially profitable both in terms of lower tax bills and more job opportunities.

Updating some research from Richard Vedder of Ohio University, we found that from 1998 to 2007, more than 1,100 people every day including Sundays and holidays moved from the nine highest income-tax states such as California, New Jersey, New York and Ohio and relocated mostly to the nine tax-haven states with no income tax, including Florida, Nevada, New Hampshire and Texas. We also found that over these same years the no-income tax states created 89% more jobs and had 32% faster personal income growth than their high-tax counterparts.

Check that out again: no income taxes = 89% MORE jobs and 32% more wealth growth for individual citizens. Yeah, higher taxes are totally way better for the economy. Like, totally. (rolling eyes) It’s like people forget that our businesses are competing not only on a national scale but a global one. So when you have a company that’s thinking about expanding operations, guess what??? they’re considering things like overhead costs. Guess what is the #1 contributor to overhead costs – T.A.X.E.S.  Liberals should take note on Gov. Perry’s (R-Texas) outlook:

One last point: States aren’t simply competing with each other. As Texas Gov. Rick Perry recently told us, “Our state is competing with Germany, France, Japan and China for business. We’d better have a pro-growth tax system or those American jobs will be out-sourced.” Gov. Perry and Texas have the jobs and prosperity model exactly right. Texas created more new jobs in 2008 than all other 49 states combined. And Texas is the only state other than Georgia and North Dakota that is cutting taxes this year.

And for good humor, here’s a joke I heard this past election cycle that better sums it up:

The Tax System – Explained With Beer

Suppose that every day, ten men go out for beer and the bill for all ten comes to $100.

If they paid their bill the way we pay our taxes, it would go something like this:
* The first four men (the poorest) would pay nothing.
* The fifth would pay $1.
* The sixth would pay $3.
* The seventh would pay $7.
* The eighth would pay $12.
* The ninth would pay $18.
* The tenth man (the richest) would pay $59.

So, that’s what they decided to do.

The ten men drank in the bar every day and seemed quite happy with the arrangement, until one day, the owner threw them a curve.

‘Since you are all such good customers,’ he said, ‘I’m going to reduce the cost of your daily beer by $20.’
‘Drinks for the ten now cost just $80.’

The group still wanted to pay their bill the way we pay our taxes so the first four men were unaffected. They would still drink for free. But what about the other six men – the paying customers? How could they divide the $20 windfall so that everyone would get his ‘fair share?’

They realized that $20 divided by six is $3.33. But if they subtracted that from everybody’s share, then the fifth man and the sixth man would each end up being paid to drink his beer. So, the bar owner suggested that it would be fair to reduce each man’s bill by roughly the same amount, and he proceeded to work out the amounts each should pay.

And so:
* The fifth man, like the first four, now paid nothing (100% savings).
* The sixth now paid $2 instead of $3 (33%savings) .
* The seventh now pay $5 instead of $7 (28%savings) .
* The eighth now paid $9 instead of $12 ( 25% savings).
* The ninth now paid $14 instead of $18 ( 22% savings).
* The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four continued to drink for free. But once outside the restaurant, the men began to compare their savings.

‘I only got a dollar out of the $20,’ declared the sixth man. He pointed to the tenth man, ‘but he got $10!’
‘Yeah, that’s right,’ exclaimed the fifth man. ‘I only Saved a dollar,too. It’s unfair that he got ten times more than I!’

‘That’s true!!’ shouted the seventh man. ‘Why should he get $10 back when I got only two? The wealthy get all the breaks!’

‘Wait a minute,’ yelled the first four men in unison. ‘We didn’t get anything at all. The system exploits the poor!’

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn’t show up for drinks, so the nine sat down and had beers without him. But when it came time to pay the bill, they discovered something important. They didn’t have enough money between all of them for even half of the bill!

And that, boys and girls, journalists and college professors, is how our tax system works. The people who pay the highest taxes get the most benefit from a tax reduction. Tax them too much, attack them for being wealthy, and they just may not show up anymore. In fact, they might start drinking overseas where the atmosphere is somewhat friendlier.

For those who understand, no explanation is needed.

For those who do not understand, no explanation is possible.