Socialism doesn't work -- the economics just don't work out. Because of this, Obama's hare brained scheme of taxing the rich and their employers to redistribute the wealth to lower income Americans is as foolish as can be.
Obama's idea, which he described on the op-ed page of Friday's Quad City Times as being "one possible option" and not a formal plan, would raise more than $1 trillion over 10 years by subjecting income of more than $97,000 to a 12.4 percent tax. Half of the tax would be paid by employees and half would be paid by employers.
Obama is floating the idea of a tax hike on the rich as a way of assuring lower- and middle-income voters that he sees an option for ensuring Social Security's solvency that would not burden them.
People need to be reminded of two things:
- The government has nothing but what it has taken (stolen, if you will) from its citizens.
- Companies don't pay taxes.
The government's absorbance of wages to redistribute to others in any form is the basic tenet of socialism. In my opinion, increasing the degree of socialization in this country is always bad.
More importantly, though, the idea that corporate taxes don't burden lower income Americans is utterly foolish. The truth is that companies don't pay taxes. In fact, companies don't really absorb any costs. All costs a company sees, including but most certainly not limited to taxes, are passed directly to the consumer. An increase in taxation results in an increase in costs for a company, which either results in the company cutting costs somewhere else (as in, employee beneifts or product quality) or in raised prices.
Ultimately, though, the only entity that ever benefits from raising taxes is the government. Likewise, the only entity that suffers from raised taxes are consumers -- a group to which we all belong to, like it or not.