A clearinghouse for commentary on supply-side economics.
Tuesday, August 3, 2010
Tax cuts for the rich.
A common theme currently among media commentators is that most Americans likely won't face a tax increase even if top earners do (see here, for example).
The unspoken assumption behind many such analyses is that as long as my taxes aren't raised, I won't object to tax increases.
Leaving aside the divisive, classist mentality upon which such analysis is based, particularly against older Americans who have higher incomes, I think Americans generally understand that if taxes are raised on my boss, or on my company's wealthy customers, or on our investors, it will reduce our profits and investment capital, leading to fewer jobs and prosperity for all. Such measures may cost me my current job, or make it harder for me to get a raise or find a better job in future.
In short, this divide and conquer strategy is a political loser. Tax cut defenders shouldn't be afraid to defend lower tax rates, including for the rich.