Sunday, November 11, 2012

Why Raising Taxes on the Wealthy Works

This should rightly be titled, "Why taxing the rich at equal levels of real-income to the poor works." But that's a BIT long. Regardless, this blog is a mini-intro to why taxing the rich their fair share is good for the economy.

1. The rich do not "create" jobs. Demand creates jobs. So when the rich say they won't create more jobs (or when they say they'll fire people who voted for Obama) because of higher taxes... they're not only lying, they're being childishly punitive.

I have no doubt that the Papa John's owner is sad he has to treat his low-wage workers better for making his objectively shitty pizza, but trust: for every person who says they won't start a business or market a product because they have to pay fair & equitable taxes, there are hundreds here and abroad who will gladly do it, and maybe even do it better.

2. Historically, when taxes on the rich have been high our country has generally experienced more prosperity, especially for the middle-class. True, this privilege was not shared by marginalized groups (e.g. Blacks, Latinos, LGBTQ, religious minorities, and others) but this is not due to the fallacy of taxes but due to systemic oppression. (Which is a separate topic for another time.)

3. In summation, higher (read: fairer) taxes on the wealthy will produce a strong economy. Why? Because then the wealthy need to invest, expand, and grow their business in order to maintain their obscene amounts of money. This translates into more jobs, including associated jobs (i.e. vendors, suppliers, etc.) which provides more people with money to spend in the market which creates more jobs in those fields. And the ripple just keeps on reverberating from there.

This is important because for capitalism to work there cannot be gross concentrations of wealth. Why? Because without money in constant flow, there is no demand and no capital to spend to support people's jobs. This is even more poignant in an increasingly consumer-based economy such as ours where, without people having money to spend, the places they go to buy stuff suffer and lay-off their staff.

Hopefully this has been educational to... some of you.

0 footnotes: