Reply #26: the notion that high taxes keep the rich from participating in the economy is an overplayed canard

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it works for the right to use it because there's an element of truth to it. rich people do consider taxes when deciding what to do. but for the most part, it influences HOW they participate in the economy, not IF they participate in the economy.

high tax marginal rates might lead them to steer more of their money to tax protected instruments like munis, but is this really such a terrible thing?

the only real risk is that they might move out of the country entirely, but this is not likely to be significant for quite a number of reasons, not the least of it is that america remains the best place for the rich to protect and expand their wealth.


moreover, quibbling about something like 33% vs. 39% is ludicrous. NO ONE decides against starting a business because the tax rate is 39%, where they really would have done it had the tax rate been 33%. if we're talking about jacking up tax rates above 70%, then the right might have a point, but no one's talking about that.

and even when we DID have marginal tax rates that high, we had a ton of loopholes that amounted to the government directing the economy via the tax code. they made sure there were way -- productive way -- for the rich to shelter their money by doing something desireable. for the most part, anyway. eventually the rich lobbied for more and more crazy, non-productive loopholes that it became silly, thus building their argument for doing away with it entirely.