Despite all the evidence that economics do in fact "trickle down" and that Mr. Laffer was probably right about his curve, we are at it again. Just like Wilson, Roosevelt, Johnson, and Carter before him, Obama will raise taxes on the well-off and wealthy and like his predecessors, he will fail at economics and thrust this country deep into a depression.
It's like this...
Let's say that there are 30 people working in an office and one day they decide to order pizza. They figure that it will take 15 pizza's to feed the crew. 8 slices per pizza gives each person 4 slices for lunch. At $10 a pizza, that works out to $150 or $5 per person. Then someone decides that this is not fair. Surely some people in the group more money than the others, therefore, they should pay more than the people who won't. So instead of $5 per person, it's $8 for the people who with more money and $3 for the people who make less money.
Question:
What are the people who have more money going to do?
Answer:
They are going to opt out and eat something else for lunch.
If you figure that there are 8 people out of the 30 who make more money and all 8 of those "rich folk" decide to opt out of the pizza for lunch - how much pizza can the 22 people buy. At $3 a head they can only afford $66 worth of pizza - That's 6 pizza's for 22 people at 8 slices per pie comes to 2 slices per person.
Did you see what happened? By charging one group of people more, they decided that they would be able to spend less and get as much to eat if they went somewhere else. As a result, there was less to go around. Business will and historically have followed this same model.
Someone told me yesterday that it is OK to tax these "rich people" because it's just not fair that they have so much money. He also went on to tell me that these people had more tax breaks than we do and therefore did not pay as much taxes as the rest of us. I got him to agree that businesses would recover their bottom line from the consumers and employees, but he maintained that it was the right thing to do based on fairness.
I can't take it anymore. This is the mindset of the left. Fairness no matter the cost. My boss owns a small business and he brings in more than the $250K cap. If he has to pay more in taxes, like any business owner, he is going to try to recover that cost. Rule #1 of business owners - never recover the bottom line from your own pocket. Cost is usually the first to be affected followed closely by benefits and pay raises followed by lay-offs.
So in order of misery:
1. Stuff I buy starts to cost more.
2. I pay more for health insurance.
3. I don't get that pay raise to cover the above costs.
4. The boss can't afford to keep me around so he lays me off.
Supply-side economics is not a theory, it's a fact - one that we have learned time and time again. Keynes was an idiot.