[Ditto]

If you forego taxing interest, dividends, and capital gains, the money must be made up for somewhere, and the only somewhere is the full consumption of wages by low-end and middle workers, since high end wage earners rarely consume anything close to all of what they earn.

From a macro-economics stand point, I must disagree with you. Unless the "high end wage earners" are stuffing dollars under their mattress, they like the low-end earners, are consuming every penny they get. All money is spent one way or another. It can be spent at retail, or it can be invested (i.e. passed to some third party) and then spent. One way or another, it is all spent.

[sitetest]

Dear Ditto,

Some high wage earners spend it all, some don't.

The real issue is folks with very large incomes, most of which are produced via investment portfolios.

These folks are currently taxed, albeit at low rates, on their dividend income and capital gains, and at ordinary rates for interest income.

But, lots of these folks don't spend anywhere near what they actually receive in currently-taxable income. They pay their taxes and re-invest a lot of the dough.

These folks will see their overall tax burden fall dramatically.


sitetest

[Hermann the Cherusker]

From a macro-economics stand point, I must disagree with you. Unless the "high end wage earners" are stuffing dollars under their mattress, they like the low-end earners, are consuming every penny they get. All money is spent one way or another. It can be spent at retail, or it can be invested (i.e. passed to some third party) and then spent. One way or another, it is all spent.

Putting money into money accounts, bonds, stocks, REIT's, hedge funds, mutual funds, options, futures contracts, swaps, foreign exchange contracts, etc. is not "consumption" by any stretch of the imagination, since all these items are cash or cash equivalents. Nor do these activities produce spending of themselves.

[Mind-numbed Robot]

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