Maybe instead America can be the Yeah, We’re the Land of Opportunity, But Don’t Get Carried Away With It, O.K.?
If those darn rich people would just stop being rich, then we’d have no budget problems at all.
Some of the rich are guiltily admitting as much. They’ve banded together into United for a Fair Economy. They’ve signed a pledge pleading with the government to tax the rich more.
“Seattle-based Judy Pigott, one of the heirs to her grandfather’s company that builds Peterbilt trucks and other heavy equipment, was one of the first people to sign the Pledge,” says a press release from the organization.
“’If we even kept what was in place from the end of the Reagan years and into those of Bush I,’” says Pigott, “’I suspect we’d not be in a budget crisis now. Let’s do what it takes to support all of us, since it takes all of us to keep this nation going.’”
You see, it takes a village to tax the rich.
Of course, Ms. Pigott is probably relying on her considerable economic experience as an heiress to come to that conclusion.
Economists and historians disagree with Ms. Pigott: “The historical evidence suggests that capital gains tax reductions tend to increase tax revenue,’ says Shahira ElBogdady Knight an economist with the Congressional Joint Economic Study Committee.
“When capital gains tax rates were lowered in 1978 and again in 1981, revenue climbed steadily. Conversely, when the tax rate was increased in 1987, revenue began declining despite forecasters predictions it would increase. For instance, capital gains tax revenue in 1985 equaled $36.4 billion after adjusting for inflation, yet $36.2 billion was collected in 1994 under a higher tax rate. In other words, tax revenue in 1994 was slightly less than it was in 1985 even though the economy was larger, the tax rate was higher, and the stock market was stronger in 1994.”
But what about fairness?
In the interest of fairness, there is only one group of people that need to be taxed.
Because the rich people in Congress are out of control.
This column was orginally published Apr 18, 2011. Unfortunately it is relevant today.