Democrat's Get-The-Rich-Quick Scheme

FUSION JANUARY/FEBRUARY 2010


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Top Hat Photo Courtesy of ©iStockphoto.com/Oliver Childs

By Tyler Grimm


 

The $787 billion “stimulus” program may have created little to no jobs in the U.S., but Democrats have found a surefire way to provide a boon to the Swiss and Grand Cayman banking industry: A millionaire’s tax.

With the federal budget deficit this year exceeding a record $1.4 trillion, fleecing the rich is now being touted as the way to bankroll Obamanomics. The latest health care bill to be passed by the House of Representatives, for instance, contains a punitive surtax for individuals making more than $500,000 or couples making more than $1million a year.

The “wealthy” have long been an easy political target so, this is really no surprise. Besides, it’s not a bad deal, right? I mean, the rich have plenty of money, so why not make them cough up a little more?

The reality is that these schemes never produce their intended results. Instead of filling government coffers to benefit the public good, these punitive taxes always end up bringing in less revenue than expected. Why? Because the rich stash their money off-shore, move to more tax-friendly locales or simply decide to work and invest less because of the tax consequences.

Kail Padgitt, an economist at the non-partisan Tax Foundation says, “Millionaires’ taxes are not reliable revenue sources. These might provide revenue in the short run, but the long-run costs make it a terrible bargain.”

This is not just a federal phenomenon. This year, Hawaii became the fifth state to implement a so called “millionaires’ tax” (the other four: California, Maryland, New Jersey and New York). In each of these states, unintended consequences abound.

Last year, cash strapped Maryland implemented a millionaires’ tax with depressing results: Revenue from that tax bracket was down $100 million and one-third of the people in that bracket were no longer there.

New Jersey produced similar results. Because of the implementation of a half-millionaire tax in 2004, the number of families making over $500,000 grew by 16 percent less than the national average between 2003 and 2006.

In California and New York, it’s hard to tease out the effects of high-income taxes from other bad fiscal policy. Over the last decade, the two states have seen, on net, 1.4 million and 1.9 million people (respectively) move out.

In California, the state’s highly progressive tax structure drove both rich and poor away. According to the Public Policy Institute of California, in the top quintile, 1.16 per every 100 households left between 2004 and 2007. In the bottom quintile it was 1.73—surely due to many employers (likely in the top quintile) departing. And where did they go? Three of the top destination states were Nevada, Texas and Washington, none of which have an income tax.

In the case of New York, it is losing many of its wealthy investment bankers to tax-friendly Connecticut, just across the border. In the words of public policy expert George Gilder, “High tax rates do not redistribute income, they redistribute people.”

Even the Beatles—certainly no Reaganite conservatives—were tax refugees. Their song “Tax Man” was about England’s terrible tax burden. They were paying 95 percent of their income to the crown (“There’s one for you, nineteen for me”). So what did they do? They moved to the then low-tax United States, of course.

Now let’s suppose you don’t believe that these taxes will have adverse consequences and are a good idea on the grounds of economic justice. After all, during his campaign, Barack Obama said that he would look at raising taxes “for purposes of fairness.”

Well, chances are that you don’t make over $1 million a year—no hard feelings, only .3 percent of Americans do. However, “millionaires’ tax” has become a catch-all term, usually referring to any tax on income over $250,000. Over the summer, House Speaker Nancy Pelosi explained why her colleagues’ newly proposed tax would fly politically: “You hear ‘$500,000 a year,’ you think, ‘My God, that’s not me.’”

Pelosi and company see such measures as reasonable because they appeal to people’s sense of fairness or, possibly, envy: The rich earn so much more income so they should pay more in taxes. The problem with that logic is that they already do. The Internal Revenue Service’s most recent data shows that the top 1 percent paid 40 percent of all income taxes in 2007, more than the entire bottom 95 percent.

Last April, in conjunction with tax day, a Gallup poll asked, “Do you consider the amount of federal income tax you have to pay as too high, about right, or too low?” Forty-six percent of respondents answered, “about right”—the highest since 1956. This might be surprising until you learn that the poorest 40 percent of Americans now pay a negative income tax rate.

The people who make up these elusive top tax brackets are not all Paris Hiltons and Derek Jeters. It’s estimated that roughly half of America’s small-business income would be hit by Obama’s plan to raise the top two tax rates. This couldn’t come at a worse time. As Dr. Padgitt explains, “As the economy begins to recover, we need a tax system that attracts investment. Millionaires’ taxes provide the exact opposite.” 

Acclaimed environmentalist and author of "Apocalypse Never" Michael Shellenberger joined Glenn Beck on the radio program Wednesday to warn us about the true goals and effects of climate alarmism: It's become a "secular religion" that lowers standards of living in developed countries, holds developing countries back, and has environmental progress "exactly wrong."

Michael is a Time "Hero of the Environment," Green Book Award winner, and the founder and president of Environmental Progress. He has been called a "environmental guru," "climate guru," "North America's leading public intellectual on clean energy," and "high priest" of the environmental humanist movement for his writings and TED talks, which have been viewed more than 5 million times. But when Michael penned a stunning article in Forbes saying, "On Behalf of Environmentalists, I Apologize for the Climate Scare", the article was pulled just a few hours later. (Read more here.)

On the show, Micheal talked about how environmental alarmism has overtaken scientific fact, leading to a number of unfortunate consequences. He said one of the problems is that rich nations are blocking poor nations from being able to industrialize. Instead, they are seeking to make poverty sustainable, rather than to make poverty history.

"As a cultural anthropologist, I've been traveling to poorer countries and interviewing small farmers for over 30 years. And, obviously there are a lot of causes why countries are poor, but there's no reason we should be helping them to stay poor," Michael said. "A few years ago, there was a movement to make poverty history ... [but] it got taken over by the climate alarmist movement, which has been focused on depriving poor countries, not just of fossil fuels they need to develop, but also the large hydroelectric dams."

He offered the example of the Congo, one of the poorest countries in the world. The Congo has been denied the resources needed to build large hydroelectric dams, which are absolutely essential to pull people out of poverty. And one of the main groups preventing poor countries from the gaining financing they need to to build dams is based in Berkeley, California — a city that gets its electricity from hydroelectric dams.

"It's just unconscionable ... there are major groups, including the Sierra Club, that support efforts to deprive poor countries of energy. And, honestly, they've taken over the World Bank [which] used to fund the basics of development: roads, electricity, sewage systems, flood control, dams," Micheal said.

"Environmentalism, apocalyptic environmentalism in particular, has become the dominant religion of supposedly secular people in the West. So, you know, it's people at the United Nations. It's people that are in very powerful positions who are trying to impose 'nature's order' on societies," he continued. "And, of course, the problem is that nobody can figure out what nature is, and what it's not. That's not a particular good basis for organizing your economy."

Watch the video below to catch more of the conversation:

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Dr. Voddie Baucham, Dean of Theology at African Christian University in Lusaka, Zambia, joined Glenn Beck on the radio program to explain why he agrees with Vice President Mike Pence's refusal to say the phrase "Black Lives Matter."

Baucham, who recently drew national attention when his sermon titled "Ethnic Gnosticism" resurfaced online, said the phrase has been trademarked by a dangerous, violent, Marxist movement that doesn't care about black lives except to use them as political pawns.

"We have to separate this movement from the issues," Baucham warned. "I know that [Black Lives Matter] is a phrase that is part of an organization. It is a trademark phrase. And it's a phrase designed to use black people.

"That phrase dehumanizes black people, because it makes them pawns in a game that has nothing whatsoever to do with black people and their dignity. And has everything to do with a divisive agenda that is bigger than black people. That's why I'm not going to use that phrase, because I love black people. I love being black."

Baucham warned that Black Lives Matter -- a radical Marxist movement -- is using black people and communities to push a dangerous and divisive narrative. He encouraged Americans to educate themselves on the organization's agenda and belief statement.

"This movement is dangerous. This movement is vicious. And this movement uses black people," he emphasized. "And so if I'm really concerned about issues in the black community -- and I am -- then I have to refuse, and I have to repudiate that organization. Because they stand against that for which I am advocating."

Watch the video below to catch more of the conversation:

Want more from Glenn Beck?

To enjoy more of Glenn's masterful storytelling, thought-provoking analysis and uncanny ability to make sense of the chaos, subscribe to BlazeTV — the largest multi-platform network of voices who love America, defend the Constitution and live the American dream.

We're going to be doing an amazing broadcast on Thursday, July 2nd, and we will be broadcasting a really important moment. It is restoring truth. It is restoring our history. It is asking to you make a covenant with God. The covenant that was made by the Pilgrims. And it's giving you a road map of things that we can do, to be able to come back home, together.

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On last week's Wednesday night special, Glenn Beck revealed where the Black Lives Matter organization really gets its funding, and the dark money trail leading to a cast of familiar characters. Shortly after the program aired, one of BLM's fiscal sponsors, Thousand Currents, took down its board of directors page, which featured one of these shady characters:

Ex-Marxist professor and author of "Beyond Woke," Michael Rectenwald, joined Glenn Beck on the TV show to fill us in on the suspicious change he discovered on the Thousand Currents webpage and the Communist terrorists who is now helping run the organization. (Fortunately, the internet is forever, so it is still possible to view the board of directors page by looking at a web archive from the WayBack Machine.)

Rectenwald revealed the shocking life history of Thousand Currents' vice chair of the board, Susan Rosenberg, who spent 16 years in federal prison for her part in a series of increasingly violent acts of terrorism, including bombing the U.S. Capitol building, bombing an FBI building, and targeting police for assassination.

"Their whole campaign was one of unbelievably vicious, murderous cop killings, assassinations, and bombings," explained Rectenwald of Rosenberg's terror group known as the May 19th Communist Organization or M19.

Watch the video below to catch more of the conversation:


Glenn's full investigation into the dark origins of the funding behind Black Lives Matter is available for BlazeTV subscribers. Not a subscriber? Use promo code GLENN to get $10 off your BlazeTV subscription or start your 30-day free trial today.

Want more from Glenn Beck?

To enjoy more of Glenn's masterful storytelling, thought-provoking analysis and uncanny ability to make sense of the chaos, subscribe to BlazeTV — the largest multi-platform network of voices who love America, defend the Constitution and live the American dream.