Commentary by James H. Shott
So breathtaking is the failure of some in Washington to understand and embrace simple economic principles that it defies rational explanation. For some of them it isn’t so much a matter of not understanding economics as it is subscribing to the principles of a different economic system, a non-capitalist economic system.
Elizabeth Warren is the former Obama administration consumer advocate who came to Washington from teaching bankruptcy at Harvard Law School to help the federal government create bankruptcy for private businesses. Ms. Warren was tabbed for formal nomination to that new position, which required Senate approval. Her ideas were so toxic with Wall Street, Republicans, and moderate Democrats, and drew such strong opposition from them, however, that President Obama instead appointed her as an adviser rather than submit her name in nomination. Ms. Warren has moved on from the administration and is now a Democrat candidate for the Massachusetts Senate seat won by Republican Scott Brown last year.
At a campaign event in Massachusetts in August, Ms. Warren attempted to refute the GOP charge that raising taxes on the wealthy amounts to "class warfare." "There is nobody in this country who got rich on his own. Nobody," she declared, which really has nothing to do with refuting charges of class warfare, but is typical of the far left; wanting credit for something they had nothing to do with.
"You built a factory out there? Good for you," she said. "But I want to be clear: you moved your goods to market on the roads the rest of us paid for; you hired workers the rest of us paid to educate; you were safe in your factory because of police forces and fire forces that the rest of us paid for. You didn't have to worry that marauding bands would come and seize everything at your factory, and hire someone to protect against this, because of the work the rest of us did."
“Good for you,” she says, condescendingly, of the people who make the economy work, as she implies that paying income taxes that are used to build roads, fund police and fire protection, and educate kids is equal to building a factory and putting people to work. Furthermore, it isn’t as though the folks that built the factory didn’t also pay taxes to build roads, hire firemen and police officers and educate the young, and, by the way, pay taxes at a higher rate than whose ire Ms. Warren was so deliberately trying to arouse.
It doesn’t occur to her that by creating jobs in that factory the employer enabled the employees to feed their own family, buy clothes, cars, a house, take vacations and pay their own income taxes, if they happen to be in the half of the population that actually pays income taxes. She rejects the very real mechanics of our economic system, hoping to supplant it with a different one.
The Bush tax cuts that so disgust those who think like Ms. Warren cut tax rates for everyone, putting the lie to the “tax cuts for the rich” inanity that the left robotically spews. The Economic Growth and Tax Relief Reconciliation Act of 2001 lowered tax rates for all income levels, doubled the child tax credit from $500 to $1,000 per child, and eliminated the marriage penalty by giving a married couple filing jointly a standard deduction twice that of a single filer.
What she and others want to do, however, is to return only the highest tax brackets to pre-Bush tax cut levels, and that plainly does not treat everyone the same, as the Bush cuts did. That clearly targets one group of citizens for a special penalty, ergo: class warfare.
Of course, they can’t admit that they want to single out one group, so they simply deny the truth. But even the mainstream media is beginning to get wise to the “rich don’t their pay fair share” rhetoric.
The Associated Press: “On average, the wealthiest people in America pay a lot more taxes than the middle class or the poor, according to private and government data. They pay at a higher rate, and as a group, they contribute a much larger share of the overall taxes collected by the federal government.”
ABC News: “For the most part, the wealthy pay a significantly higher percentage of their income in taxes than middle-income workers.”
The Wall Street Journal: “But nearly all millionaires still paid a rate that is more than twice the 8.9% average rate paid by those earning between $50,000 and $100,000, and more than three times the 7.2% average rate paid by those earning less than $50,000.”
So, it is obvious that the “rich” actually do pay their fair share, or more, and it is clear that the fringe left truly is guilty of class warfare.
Imposing non-capitalist economic principles onto a capitalist economy has already caused serious problems, as in the mortgage banking collapse. The Marxist philosophy Ms. Warren prefers won’t work – can’t work – without a totalitarian government, like the former USSR, Communist China, North Korea or Cuba.
Freedom-loving people will tell Ms. Warren and her buddies firmly, “No.”
Cross-posted from Observations