Tuesday, December 4, 2012

Thomas Sowell on the Fiscal Cliff

http://www.theprojecttorestoreamerica.com/ Article posted on Tuesday, December 4, 2012, entitled, "Fiscal Cliff Notes" by Thomas Sowell.

This man is a genius.  He talks about the small amount of money which will be raised by taxing the rich (and he has a great graph you can look at):

"First of all, despite all the melodrama about raising taxes on "the rich," even if that is done it will scarcely make a dent in the government's financial problems. Raising the tax rates on everybody in the top two percent will not get enough additional tax revenue to run the government for ten days.

And what will the government do to pay for the other 355 days in the year?
All the political angst and moral melodrama about getting "the rich" to pay "their fair share" is part of a big charade. This is not about economics, it is about politics. Taxing "the rich" will produce a drop in the bucket when compared to the staggering and unprecedented deficits of the Obama administration."
and he talks about "quantitative easing" (i.e. printing money):
"All the pretty talk about how tax rates will be raised only on "the rich" hides the ugly fact that the poorest people in the country will see the value of their money decline, just like everybody else, and at the same rate as everybody else, when the government creates more money and spends it.
If you have $100 and, after inflation follows from "quantitative easing," that $100 dollars will only buy what $80 bought before, then that is the same economically as if the government had taxed away one-fifth of your money and spent it."

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