Tag: revenue

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Accountability folly general freedom moral hazard porkbarrel politics property rights responsibility tax policy too much government

No Rich No More

Connecticut, taxes, revenue, budget, tax and spend, wealth, common sense

Connecticut has a budget problem. There’s not enough money to spend.

WTNH-​TV in New Haven paraphrased the situation along with the response of Connecticut’s very progressive governor: “Income tax revenue collapses; Malloy says taxing the rich doesn’t work.”

The news story explains, “Connecticut’s state budget woes are compounding with collections from the state income tax collapsing, despite two high-​end tax hikes in the past six years.”

Hmmm. Despite the tax increases? Or … “because the state of Connecticut depends too much on its wealthy residents,” as the report continued, “and wealthy residents are leaving …”

A Yankee Institute report notes that “the exodus of wealth from the state as top earners and businesses relocate to more tax-​friendly states” is a major problem. Institute President Carol Platt Liebau calls it a “terrible cycle of tax increases followed by deficits followed by even more tax increases.” 

Yet, state legislative Democrats are back pushing more tax hikes on “the rich.” Senate legislation would jack up the tax rate — retroactively — on those with income of $500,000 or more. House legislation would slap a 19 percent surcharge on some hedge fund earnings. In response, the head of the Connecticut Hedge Fund Association testified that his “industry is populated by exactly that type of person that will move based on tax policy.”*

A song by Ten Years After comes to mind: 

Tax the rich, feed the poor
Till there are no rich no more

Doesn’t sound like a good idea even in song.

This is Common Sense. I’m Paul Jacob.

 

* It’s worth noting that Gov. Malloy is now “against raising taxes again to fill the deficits and is instead focusing on spending cuts …”

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Accountability Common Sense government transparency national politics & policies porkbarrel politics tax policy too much government

The Spenders’ Eternal Excuse

Gluttony

Most modern welfare states have a huge problem: their politicians promise more than government revenue covers. So they borrow and borrow until they can borrow no more.

And then they go down. Like Greece has gone down. Banks are closed there, and the people suffer.

The problem is over-​spending and over-​promising (the latter being merely committing to future over-​spending, so let’s just call it all over-​spending). But when you confront a partisan of such extravagance — whether that person be a politician or a constituency beneficiary or an ideological socialist or social democrat — the most common defense is: THEY WOULDN’T LET US TAX ENOUGH.

The “they” in such defenses could be an opposition party, or a constituency, or … “the evil rich.”

But anyone with something other than a lump of coal for a brain knows the real truth: responsible people don’t make such defenses. If a political difficulty gets in the way of the extra revenue needed for something promised, it’s practically the same as an economic difficulty, so the excuse falls apart.

Say again?

If you cannot get enough revenue for your favorite program, it doesn’t matter whether the people who are the source of your “needed” revenue are broke — have nothing to give — or they simply balk at giving. The point is, you don’t have the revenue. The responsible reaction would be: cut back on spending.

Responsible people budget; irresponsible people blame others for not having the wherewithal to spend and spend and spend.

This is Common Sense. I’m Paul Jacob.

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Gluttony