Letters to the Editor
Matter of trust
To the Journal editor:
Whenever tax cuts are mentioned, Democrats scream (about) tax cuts for the rich, which is a diversionary tactic on several fronts.
To begin with, tax rate cuts are not about fairness or non but a battle as to whether the government or the private sector (which includes you) will have control of your money. To be fair, there is a small subset of government spenders (Keynesian) who truly believe the government or Federal Reserve can “fine tune” the economy but their track record of picking winners and losers is not impressive (think shovel ready jobs, Solyndra).
The greater set of government spenders are politicians and government bureaucrats who realize their impotence if they have no money.
As for the private sector, economist George Guilder in his book “Wealth and Poverty” said it best when he said, “When a man has an extra dollar in his pocket, marginal tax rates should be adjusted such that he is encouraged to invest it in order to earn another dollar rather than to stick it under his mattress.” That pretty well sums up the theory of a tax rate cut.
In order to maximize this effect, one needs to go where the money is, namely the upper income brackets, which is the investor, entrepreneur and the people with the most discretionary income class. Middle class cuts are important because of their shear numbers not because of their excess cash.
The other diversion is the concept of the “rich.” Since the tax involved is on income and not wealth, it is more accurate to say that these taxes fall on the people “trying to get rich.” A high cash flow does not guarantee wealth. Hence the hypocrisy of the Buffetts, Gates, Kennedys saying they don’t mind if taxes are raised. Their earned income is adjustable and so the bulk of their wealth is not subject to income tax.
An observation about the “soak the rich crowd.” Apparently they don’t grasp the fact the boss never lays himself off first. Hence one should note that one has to hurt an awful lot of the little people before the rich are even annoyed.
So the crux of the matter is who do you trust to spend your money better, the government or the private sector?