Say Anything Blog

Barack Obama, apparently trying to shed the “tax and spend liberal” title he so richly deserves, is trying to convince Americans that most citizens wouldn’t see their taxes go up if he’s President.

Is that a true statement?  Not at all, which makes it a lie.

Just as one example, let’s keep in mind that Obama favors nearly doubling the capital gains tax from 15% to 28%.  Capital gains are taxes every American pays, regardless of income, on income from investments and sales of property.  Obama says that he favors this massive tax hike out of an interest in “fairness” and not for government revenue.  Because Obama feels that only rich people pay capital gains taxes.  Which isn’t true at all.  Approximately 70% of Americans have some sort of investment in the stockmarket, and any income they get from those investments will be subject to the capital gains tax.  Further, the sale of any property (second homes, investment land, lake cabins, or even the sale of things like coin collections) can be taxed as capital gains as well.

If Obama thinks doubling the capital gains tax won’t impact most Americans he’s a full.  It will impact a majority of Americans directly, and all Americans indirectly.  After all, the tax consequences of a given investment are a deciding factor for most people.  If those consequences are twice as bad, most people will be a lot less likely to invest.  Less investment means less property purchases, and less capital for businesses.  Less purchases and less money for businesses means fewer jobs and less wealth for everyone.

As JFK (someone who Obama is inexplicably compared to frequently) said in 1963:

The tax on capital gains directly affects investment decisions, the mobility and flow of risk capital . . . the ease or difficulty experienced by new ventures in obtaining capital, and thereby the strength and potential for growth in the economy.

Finally, it’s worth noting that even just raising taxes on “the wealthy” impacts all Americans.  After all, the wealthy tend to do a great deal of business with the not-so-wealthy.  If wealthy people have more of their money taken by the government they’ll have less to spend on those transactions, which in turn will hurt the not-so-wealthy who would have benefited from them.

I know that it is a liberal article of faith that the wealthy only help the poor when their money is taken from them by the government and redistributed to the poor, but the truth is that by merely spending their money in the economy the wealthy do more to help the middle and lower classes than any government program ever has.