Some policy makers in Washington believe that it is a good idea to grow the amount of federal income by increasing taxes on America’s wealthier citizens. From the political standpoint this could get some votes for the liberal politicians serving in our nation’s capital but it would have bad consequences concerning job creation and economic growth.
For instance, the proposal to levy a surtax on all income exceeding $1 million per year would affect thousands of small business owners and these S-Corps and LLC’s would be paying around 50% of their income to Uncle Sam. The present top rate for federal taxes on corporations is around 35% plus the state taxes they pay.
As tax time approaches, it is a good time to look once again at who is paying what to the federal government in taxes. Almost 50% of all Americans pay very little federal taxes. For every ten people you see walking the streets or in the grocery store about half of them are basically living off the backs of those other 50% that pay taxes.
The information available from the IRS shows that the top 1% of American households paid 38% of total federal taxes while earning 20% of total income. The “spend more tax more” crowd will not stop with just the millionaires. They plan to raise income taxes on individuals who make $200,000 or more (couples $250,000) by allowing some tax cuts to expire.
This column is not about the Republicans or Democrats, the president, the past president or presidents before them. It is about those in congress who are responsible for this unfair system and those who want to make the system even more unfair. The approval rating of congress is around 11%, which means that most people disapprove of their actions except for their family and friends.
Let’s be honest with ourselves and look at the elections coming up this year. The 50% of Americans who pay only one percent of the taxes are going to vote for the candidates who will support them continuing to pay such a small amount of the taxes. They cringe when they hear the words “fair or flat tax.”
Who folks will vote for goes further than just the tax situation. Every gay or lesbian will vote for the candidate who supports gay marriages. Every American who has no problem with abortion will vote for the candidate who is pro-choice.
Do the math. Add all these folks up and they could represent a majority or more of Americans who will vote to keep their system and gravy train in place. The other 50% or less of us Americans will continue to pay through the nose until all the money is gone and our country collapses.
One further thing that needs pointing out. Many Americans have paid a sizable amount of their pay checks into a pension system that was supposed to last until their death. If America collapses that will be gone. All Americans have paid into Social Security with their employers matching their payments and if this country fails, that will be gone.
My prayer is that the above will not happen and when election time comes this nation will elect political leaders who will work to stop excessive government spending and more taxes on those who already pay the high rates so this country can continue to pay its bills.
In conclusion, it is time for our political leaders in Washington to realize that our nation does not suffer from a revenue problem. Our nation suffers from a spending problem that is threatening to break the backs of this country’s most successful innovators and job creators.
