Thursday, August 4, 2011
© Copyright 2014
For the past several weeks, there has been a lot of drama in Washington about raising the debt ceiling. Even with the compromise, the debate will continue. Listen carefully to the words that speakers and writers are using. Notice how those who speak of the crisis in terms of "deficit reduction" will rarely use the words "spending cuts" with the same degree of conviction. Deficit reduction is often used as a code phrase for raising taxes. The ill conceived notion is that tax revenues come from a pie that stays the same size.
By taking a larger slice from the "rich," they believe that tax revenues will increase.
Harry Reid vilified corporate jets and yachts. In 1990, the first President Bush signed into law a luxury tax that was expected to bring in an additional $31 million in new revenue. It actually brought in $16 million. It also killed the yacht-building industry in New England, costing 25,000 jobs and $24 million in lost revenue and unemployment benefits. The class warfare policies that killed the yacht industry are still at work today.
Tax revenues increase through a growing economy, not through class warfare rhetoric. More Americans than ever are beginning to learn that lesson. Unfortunately for too many, the tuition for that lesson comes in the form of a pink slip.