Saturday, April 19, 2008

Tax the Rich, Hurt the Poor

Barack Obama either doesn’t understand economics, or he is so tightly bound to the leftist tax-and-spend philosophy that he can’t see what should be plain to everyone. At last Tuesday’s Democrat debate with Hillary Clinton, Obama seemed confused when confronted with the historical reality that raising tax rates on capital gains will result in less revenue for the federal coffers, not more.

ABC’s Charlie Gibson presented information showing that when the capital gains rate goes up, revenue from the tax goes down, and when the rate is lowered, tax revenues increase. Obama responded to Gibson, who to his credit actually pressed Obama on an issue for a change, that raising the capital gains tax is necessary "to make sure . . . that our tax system is fair and that we are able to finance health care for Americans who currently don't have it and that we're able to invest in our infrastructure and invest in our schools. And you can't do that for free." Gibson tried a second time to get through to the Illinois Democrat that he would not be able to fund universal health care by raising the capital gains tax, to which Obama replied that economic reality might not be economic reality, depending upon what happens on Wall Street.

It is rare instances like this, when Obama is actually pressed on the finer points of an issue, that he reveals the inner Barack: a hopelessly left-wing ideologue that puts dogma ahead of common sense. By insisting on raising taxes when the result will be negative revenue, Obama shows us that he’s more concerned with punishing “the rich” (making the tax system fair) than providing universal healthcare. Never mind that when asked where he would draw the line controlling who got a tax hike he drew that line right through the middle class.

Despite this glaring inconsistency between what he wants to do and what works, Obama would not concede that raising taxes on capital gains would do precisely the opposite of what is required to be able to provide universal health care. His mind is made up, and damn the facts. It’s very much like his foolish plan to withdraw troops from Iraq, whatever the situation and whatever the consequences.

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