I would draw everyone’s attention to the Rahn Curve. It shows that when government increases the marginal tax rate above 20% that people respond by earning less taxable income. Over time, federal tax revenues have run about 20% even when rates were far higher.
see: The Rahn Curve and the Growth-Maximizing Level of Government
http://www.youtube.com/watch?v=uj6lRFXC5rA
And then there is this:
“In 2008 about 320,000 Americans reported income of more than $1 million, or about 0.3% of all income tax returns. They paid about $250 billion in taxes that year. Mr. Conrad is going to get nearly $2 trillion more from them without damaging the economy? That should be some trick. ”
From the article, Conrad Wants $2 Trillion , on Senator Kent Conrad’s budget and tax ideas, from the WSJ, July 11, 2011.
Both of these citations show that anyone who is proposing a federal budget that includes an increase in the marginal tax rates cannot count on government actually realizing any higher revenues from that increase. Any projections based on increased taxes will be unrealized. Further, there are just not sufficient levels of income to tax. This means that the federal government MUST base a rational budget solely on cuts in spending. Any talk of “shared sacrifice” is vapid dreaming and we no longer have the prosperity and leeway to entertain liberals by giving in to their vapid dreams.
Of course, this is all apart from the issue that taxing the rich is just a thinly veiled form of petty coveting the wealth of others, and hoping to be able to get government to steal it from them (legally of course), so that there is more wealth to spread around on favorite programs. Never mind that the average government employee has a total compensation package of $123,049, as compared to the median household income of $52,029, at least according to USA Today and the US Bureau of the Census.
Political and economic lexicon is very important, and something that liberals had the advantage in that department over conservatives for decades, using the "populist" language to cover up their "sweet" lies. Just recently, Obama and the Democrats subtly change the word "taxes" into "revenues" as if the two are automatically synonymous or the same (i.e., presumption that higher marginal tax rates directly equal higher government revenues) which is absurd, as often it results in exactly the opposite.
It's time to treat them to the their own medicine and adjust the lexicon, but based on the truth instead of the liberal lies.
For instance, the term "revenue" itself should be derided as the "[increased] tax on economic growth" and additional "tax burden on jobs creation".
The term "tax cut" for the "rich / billionaires and millionaires" sets an "anchor" - the impression that the government revenues were reduced / "cut" from some higher "natural" rate that liberals decided on for a time - and should be transformed by Republicans into "reduction in tax on economic growth" and "tax relief" for the "jobs creators / jobs producers" and the "working middle class".
The "paying their fair share" argument should be countered to name what number would constitute the "fair share" that the top percentiles of earners should pay as a percentage of total government "revenues" - it's pretty much guaranteed that the number they come up with would fall far short from the actual number top earners pay.
The term "government investment" (on "infrastructure," education, healthcare, environment) should be countered with "out-of-control, profligate, ill-conceived, counterproductive, open to fraud, waste and abuse, and uneconomically expensive government spending of taxpayers money on useless projects 'to nowhere'".
Given the obviously inadequate and critically dismal performance of government services that are constantly growing in cost, such as education and health, this terminology will find a receptive ear with the public, just like Reagan's rhetoric found the support of those who became and remained "Reagan Democrats."
From The Democrats' Big Tax Lie - TDB, by Michael Medved, 2011 July 28
The trouble with this rhetorical approach is that it relies on an obvious and embarrassing falsehood: far from paying the “lowest rate in 50 years," top earners actually paid at the current rate or significantly lower for most of the time in the last quarter century. ..... < snip > ..... Even a cursory glance at the historical records make it clear the amount of revenue flowing to the federal government bears little connection to the tax rates applied to the wealthiest Americans. In 1951, for instance, top-earning families (those who earned more than $400,000) paid a confiscatory top marginal rate of 91 percent, but the government collected just 16.2 percent of the GDP in revenue. More than 30 years later, during the brief three-year interlude when taxpayers enjoyed the low Reagan top rate of 28 percent, the feds took in vastly more total revenue - an average of 17.9 percent. In other words, contrary to the simplistic assumption that raising tax rates always increases revenues, a rate of 91 percent brought in less to the Treasury by every standard than a 28 percent rate. Alan Reynolds, a veteran economist with the Cato Institute (and a frequent guest on my radio show) isolates the figures for individual income-tax collections (excluding corporate levies, capital-gains tax, estate tax, and other sources of revenue) and shows that higher top rates historically bring somewhat lower - not higher - tax collections. Between 1952 and 1979, the top tax rate ranged from 70 percent all the way to 92 percent, but revenues from personal income tax amounted to only 7.8 percent. From 1988 through 1990, with the highest individual rate 28 percent, taxpayers actually provided more funds, not less - 8.1 percent of GDP. Reynolds concludes: “The trendy talking point of blaming projected deficits on ‘tax cuts for the rich' is flatly absurd. ..... < snip > ..... The most recent numbers (updated in October 2010) show that the top 1 percent of tax returns covered an amazing 38 percent of all income taxes - nearly doubling the share of the total income they earned (20 percent). The top 5 percent of taxpayers (earning above $159,000) earned 35 percent of all income, but paid the big majority of all income taxes - 59 percent. ..... < snip > < snip > ..... The Democratic line about “the lowest rate in 50 years" effectively reinforces two important liberal themes: first, that the rich don't pay their fair share to support the operations of government, and second, that hiking rates on undertaxed wealthy people offers a painless, eminently fair way to increase revenue and reduce the deficit.
From Time to Man Up - B, by Gene Epstein, 2011 August 06
These tax hikes have been scored by the president's own Office of Management and Budget as contributing a bit less than $1 trillion in reducing the debt over the 10 years. Even without discounting that figure as probably erring on the high side, it barely makes a dent in the long-term fiscal problem. Unless the president is willing to consider far more ambitious cuts, especially on the entitlement programs, he will have to hike taxes on virtually everyone with an income. CBO FIGURES SHOW that the full burden of the federal tax is about as progressive as it was in the late 1970s; the richer the income group, the greater the share that it pays. All income groups pay a somewhat lower effective rate than they used to, but by far the steepest proportionate drop has been among the lowest 20%, which paid just 4.2% of their income in taxes in 2006 and 2007, the most recent years for which figures are available. The top 1% of income recipients paid 30.4% of their income in federal taxes in 2006-07, the highest effective rate. That figure includes all ways the Internal Revenue Service can make claims on income, including corporate income taxes, of which the top 1% pay a disproportionate share, because they own a disproportionate share of stock. (The 30.4% excludes estate taxes.) In order to be in the top 1% in those two years, you had to earn at least $350,000, a figure that might not even qualify you for the president's targeted group of "millionaires and billionaires." (Millionaires here being defined as households that earn at least $1 million a year.) But because there are plenty of real M&Bs in the top 1%, this income group did account for 28.2% of all federal taxes paid in 2006-07. That's an impressive number, but regardless of how much it is raised, it won't cover the soaring cost of government, especially when you consider that the aggregate tax take already falls far short of paying those costs. You have to hike taxes on the top 20%, who earned a minimum of $75,000 in 2007, and even on the next quintile, who earned a minimum of $50,000. ..... < snip > ..... < snip > The $11.7 trillion also included Obama's own proposal for raising rates on the two top income brackets and increasing the estate tax.
The truth is out there. The conservatives / Republicans just have to learn how to communicate it effectively, to counter the Lies and the Lying Liars of the Left.