If the highest income tax rate increases from its current 35% to 44% (including Medicare and Obamacare tax increases) on the wealthiest taxpayers, a high income family making $500,000 will have $45,000 less to spend. That family may decide to cut out a gardener, housekeeper, vacation, or even a new yacht. A progressive might say "so what, they are rich, and they...
Many of these things will occur even if the cliff is avoided (probably by kicking the decisions--can--down the road. If Obama gets his tax on the rich, their investing will decrease and we'll all pay.
It may not be intuitive to nonbusiness people and economists why increased taxes and reduced federal spending will send the US into a recession. However, it is not hard to understand the economic logic that causes this result.
- Quotes of the day Allahpundit 1 hour ago
- Citizen legislator Sen. Mary Landrieu doesn’t really live in Louisiana Mary Katharine Ham 2 hours ago
- Democrats go after Republican for self-defense measure he took…14 years ago Matt Vespa 2 hours ago
- Rubio: If I had to vote again on my Gang of Eight immigration bill, I’d vote no Allahpundit 3 hours ago
- Obama lets another red line lapse in Ukraine, and the consequences will be dire Noah Rothman 4 hours ago
- Heartache for lefties: Elizabeth Warren defends Israel at Massachusetts town hall Allahpundit 4 hours ago