Five days after President Obama was re-elected, Weekly
Standard editor Bill Kristol
dropped this bombshell concerning tax increases on millionaires
during an appearance on Fox News Sunday:
Really? The Republican Party is going to fall on its sword to
defend a bunch of millionaires, half of whom voted Democratic and
half of them live in Hollywood? It won’t kill the country if we
raise taxes a little bit on millionaires. It really won’t, I don’t
think. I don’t really understand why Republicans don’t take Obama’s
offer.
Shortly after Kristol made his remarks, House Republicans
appeared amenable
to supporting a millionaires’ tax while Republicans Senators like
Saxby Chambliss and Bob Corker are
expressing second thoughts about Grover Norquist’s pledge not
to increase taxes. It is now entirely conceivable the GOP could
support the end of the Bush tax cuts for the wealthiest
Americans.
But let’s look at the essence of Kristol’s argument. He argues
that we should support tax increases on millionaires because half
of them voted Democratic. Well, a lot of people who aren’t
millionaires also voted Democratic. By that logic, Kristol should
support increasing their taxes as well.
As for Hollywood, it’s no skin off my nose if George Clooney has
to pay more in income tax. But why are we determining tax policy
based on whether we dislike someone for their profession or their
politics? That’s straight out of President Obama’s playbook and
Kristol shouldn’t be taking a page from it.
Simply put, Kristol’s argument for increasing taxes on
millionaires is political, not economic, and the same can be said
for President Obama. How often did we hear Obama say on the
campaign trail that millionaires and billionaires were “getting tax
breaks they don’t need”? (Who is Obama to decide what people need
and don’t need, anyhow?) Or how often did we
hear him say the wealthiest Americans “should pay a little
more” to reduce our deficit? Of course, even if the wealthiest
Americans paid 100% in taxes, it
wouldn’t sustain the federal government for more than a few
months. But what else can we expect of a President who did not
reduce the deficit by a penny in his first term in office? Obama’s
tax increase proposal for the wealthy is intended to be punitive
and rests on a foundation of envy and resentment which he
successfully mobilized during his re-election campaign. While it
might make perfect political sense to raise taxes on the wealthy,
it makes no economic sense to do so at this time.
Earlier this month, I attended The American Spectator’s
45th anniversary dinner in Washington, D.C. Amongst the guest
speakers was oil and gas industrialist T. Boone Pickens. He stated
that over the past decade he had paid $665 million in taxes.
Pickens said if he had the opportunity to speak with President
Obama he would ask him, “What is my fair share?”
In my socialist days, I used to think that if you imposed heavy
taxes on the wealthy and on large corporations then all of our
economic problems would be solved. Of course, I have come to
realize that life is never that simple. All measures, great and
small, have unintended consequences. Increase taxes on the wealthy
too much and the wealthy move their money off shore. Increase taxes
on large corporations too steeply and those extra costs get passed
on to the consumer.
This isn’t to say I’m not open to persuasion on increasing taxes
on the wealthiest Americans. But I need more of an argument than
the wealthy vote Democratic and live in Hollywood. Are these
increased levies going to pay down the deficit or to pay for
Obamacare and other programs? Let’s remember that last year the
national debt exceeded
100% of our GDP. We must choose wisely but unfortunately government
seldom does.
Are these levies going back to the Clinton era or are we headed
for a 75% tax rate that is being put forward by new French
President François Hollande? Or what about the 98% tax levied by
the British in the late 1960s and early 1970s? After all, if taxes
are increased to Clinton-era levels, what is to prevent Congress
and the President from increasing these rates further? Given that
our current economic growth rate is at less than 2%, how will these
tax increases promote economic growth?
Until Bill Kristol puts forth a more satisfactory argument as to
why Republicans should take Mr. Obama’s offer, the GOP would be
wise to reject it.
