As documented here, the win-win benefits of tax rate cuts have held true over the past fifty-plus years. Since 1952, the highest marginal income tax rate has dropped from 92 percent to 35 percent, and tax revenues have grown in inflation-adjusted terms while remaining constant as a percent of GDP. So it would be a blow to everyone if Obama let those tax rate cuts expire as he has promised to do (McCain wants to make them permanent).
What about the rich “not paying their fair share” (whatever that means)? The truth is the top 1% of taxpayers in the U.S. pay 39% of all federal income taxes (that’s two percentage points higher than when President Bush took office). The top 25% of taxpayers pay 86% of all income taxes. And the top 50% of all taxpayers pay 97% of all income taxes. If anything, the rich are paying far more than one should expect! And the fact that about 40% of taxpayers pay nothing means Obama’s promised tax cut for the “middle class” is mostly welfare which would be a poor stimulator of the economy.
We are told that Obama is the great unifier. But you can’t unify a country by political class-warfare rhetoric that continually divides people by their income. Nor can you encourage economic growth by punishing those who create it. There is only one way to alleviate economic hardship. It is not by creating more government, but by creating more wealth. And the way that you create more wealth is by getting the government out of the way of the wealth creators—hard-working Americans and their businesses.
Leadership built on class warfare and socialist policies will not create a more prosperous future. Everywhere socialism has been tried it has failed. It has failed in countries such as the Soviet Union and Cuba, and it has failed in services such as health care. (Rich Brits and Canadians come here for their health care; Gee, I wonder why? Go to stand in line at the government-run Department of Motor Vehicles to find out.)
Moreover, class warfare ignites the wrong kind of passion in the electorate– envy and revenge. That’s wasted energy and only produces dependence on government rather than on the true engines of economic growth--opportunity, individual responsibility and hard work. After all, the government can’t give you anything unless it takes it from another citizen first. That’s not a good recipe for growth or unity.
I will say that Obama is right about one thing. He is right when he derides the term “trickle-down” to describe the effect of tax cuts. But he is right for the wrong reason. “Trickle-down” is not wrong; it’s just too weak to describe what actually happens. What actually happens in the lives of most Americans is more like “Income-down” or “Job-down.” The economy is fueled by job creation from the top (the rich); it doesn’t bubble up from the bottom. That’s why Senator McCain needs to remind everyone of that fact by asking the question: Are you currently working for, or have you ever worked for, a poor person?
Frank Turek is coauthor of I Don't Have Enough Faith to be an Atheist, and the author of Stealing from God: Why atheists need God to make their case. See more of his work at CrossExamined.org.
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