The Republican Tax Reform legislation is working its way through Congress. As it does so debate ensues, often filled with class warfare and demagoguery.
Here are some of the myths that Democrats are circulating.
- IT’S A TAX CUT FOR THE RICH
Totally false. The top rates have not been reduced. And Rush tells us:
“In this tax bill, there is a bubble rate of 46% for people that earn a million dollars or more to make up for the fact that they only pay 12% on the first dollars. So between a million and $1,200,000, the 200,000 is taxed at 46% in order to make up for the fact that they benefited from that low opening tax rate on their first dollars.”
What the Democrats fail to tell you is that the rich already pay the majority of the taxes. Yes, there is the elimination of the Death Tax but that is not really a benefit to just the rich. The Death Tax blocks farmers, fishermen, ranchers and small businessmen from leaving their family business to their offspring.That’s not what we want in America.
The often repeated mantra that the rich need to pay their fair share is wrong. They already do!
- WE HAVE TO PAY FOR THE TAX CUT
Now, this is just ridiculous. If we have to raise taxes in one area to reduce taxes in another – what kind of tax cut is that? The fact is that any taxes cut that encourage economic growth will pay for themselves. They did so with the Kennedy cuts and the Reagan cuts. Tax revenues increased under Kennedy and Reagan cuts.
The Heritage Foundation reports:
“ In 1980, the last year before the tax cuts, tax revenues were $956 billion (in constant 1996 dollars).
Revenues exceeded that 1980 level in eight of the next 10 years. Annual revenues over the next decade averaged $102 billion above their 1980 level (in constant 1996 dollars).
Any increase in budget deficits was therefore the result of spending increases rather than tax cut-induced revenue decreases.”
Economic Growth increases salaries. When salaries increase people pay more taxes. The same holds true for business. When business expands and increases revenues, it pays more taxes on those increased revenues.
EVERY INCREASE OF 1% OF GDP IS WORTH $2.5 TRILLION IN NEW WEALTH CREATED!
- WHATEVER THE RICH EARN TAKES AWAY FROM THE POOR
Again false. The total worth of the economy is not fixed. It can grow or retract. Whatever an individual does contributes to the total worth – the GDP – but he or she does it independently of anyone else.
If I were to create a new invention, say a new fuel for internal combustion engines that was super clean and tripled gas mileage, and I became rich doing it, I would not be taking anything away from anybody else. I would be adding to my good fortune, increasing the wealth of the nation and probably supplying new good paying jobs for others in the process.
Bill Gates did not rob the poor to create Microsoft. He added wealth and jobs and contributed to the general prosperity.
What the rich do has no bearing on what the poor can do. It is possible for anybody in a free market economy to advance up the ladder of success no matter what anybody else is doing. This is the American Dream!
Outline a dime on a piece of paper. Next to it outline a quarter. The dime could be the total net worth of the economy today and the quarter what it will grow to in the near future. The wealth of the nation is not fixed. 1/ 100000000 of a percent of the quarter is much more than 1/100000000 of a percent of the dime.
The correct action is not to divide up the pie in equal slices but to make the pie bigger and bigger and bigger thus making each person’s slice more valuable.
The key word here is not EQUALITY it is LIBERTY. It is not FAIRNESS but OPPORTUNITY. Now go forth and educate your Liberal/Left friends!
NOW IF YOU REALLY WOULD LIKE TO BE ECONOMICALLY EDUCATED WATCH THIS: