Carlos Watson argues that the solution to our fiscal problems is to tax the living daylights out of the “rich” in the hopes of making up for a $5 trillion hole in our national finances.
That solution will not work.
For one, there aren’t enough “rich” people to make up for the current deficit. We could raise taxes to 99% and not came close—and then the rich people would either cease to be rich, or get their assets out of the country faster than you can say “Nancy Pelosi.” What you would have would be capital flight on a truly nightmarish scale.
In order to make up that kind of shortfall, you would not have to tax only the Bill Gateses or Warren Buffetts of the U.S.—you’d have to start taxing everyone who makes a decent living. Our professional classes are already taking a huge hit in this economy—engineers and lawyers are applying for $10/hour jobs because of the economic downturn. If we start taxing them, they will buy less, they will use less services, and the ripple effect will continue right on down the line. It will make the economy worse rather than better.
Taxing the “rich” isn’t going to solve this mess, nor is more government intervention. The sad state of our economy is due to too much government intervention and far too much debt, both public and private. In order to fix this mess we all need to start spending in line with our realistic priorities and not spending money we don’t have.
Taking more money from people with their heads barely above water and giving it to an irresponsible government is not a solution for this economy; it is economic suicide.