As the fiscal cliff looms, both parties are arguing about how to go about raising revenue and addressing taxes. Republicans are echoing the Romney plan of keeping rates the same while cutting out loopholes. President Barack Obama is deadset on seeing rates go up on the "millionaires and billionaires" that don't "need" tax breaks. No doubt such a tax increase will be met with only the most superficial in spending cuts.
Saul Alinsky, whom Obama has studied and followed, taught that the best way to bring about communism is to destroy the middle class. That's exactly what is at stake. Following Alinsky's "freeze it, personalize it, polarize it" method, Obama has picked the "1%" as the target. We are meant to view this group as the really, really wealthy. Currently the number is $250,000 per year in income and up. These are the people to be subjected to the top marginal rate that is going up. The sole purpose of this is to crush small businesses and hard working people who have made good, NOT to address the uber rich.
The entire thing is a shell game. Obama consistently uses himself and Warren Buffet as examples and justification for raising the top marginal rate. The rub is, neither are subject to the top marginal income tax rate. That rate is for "earned" income. Income generated through your toil, or business, etc. Not investment income. Investment income is taxed at the capital gains rate. Warren Buffet, George Soros, Bill Gates, et al. may see rates go from 15% to 20%.
Further, think about the idea that a lawyer pulling in $250,000 from his practice is the same as Bill Gates. Let that sink in. The increased top marginal rate will not have an effect on the likes of Bill Gates, but that guy with the small business? He's getting hosed.
But hey, we're getting all of this benefit out of the extra income, right? Actually no. The middle and upper middle class get no "assistance" from the government. What about education? Or infrastructure? Look at the stimulus package for our infrastructure. The extra money was spent on signs advertising the Obama stimulus. What about education? Ever notice how we continually spend more and more on education with fewer and fewer results? But we're getting rid of the deficit, right? The deficit is currently $1 Trillion. The Obama tax raises project revenue of $1 Trillion... over ten years. One tenth of the deficit.
So what is the net effect of this?
-The wealthy will stay wealthy.
-The small business owner and working professional will take the hit.
-Any chance of wealth accumulation for the middle class will be removed.
-The middle class will be knocked down a peg.
-The poor will become more dependent.
You were warned...