Posted by Leonard Steinberg on December 17th, 2012
The Republicans have agreed to raising the tax rates on the rich at last…..the real rich: those earning $ 1million and more per year. At last the definition of wealthy has shifted from a stupid version to a more realistic one. Which idiotic politician truly believed that earning $ 200k per year in Los Angeles, New York, Miami, Chicago, Boston, or a whole host of cities where the cost of living was so significantly higher than anywhere else in the USA was rich?
Now the Republicans have to acknowledge PART TWO of this inconvenient equation: simply raising tax rates will not make the system equitable at all. I know people who earn $ 1 million per year who pay almost TRIPLE the taxes of those who earn the exact same. That is unfair and should be considered un-American. Are we not equal in the eyes of our constitution? While I don’t think merely raising taxes on the rich is the ultimate solution, I do believe those who do earn a million or more will not cut their spending by much because of another $ 30,000.00 in taxes. It will cut savings though, but this could be off-set by an improved economy quite easily. It also may be a good idea that while raising the taxes on the real rich, they consider a contractual time-line…….so that these raises are not permanent, but tied to performance. Isn’t this what the politicians and masses are expecting of Wall Street? Once these tax raises have achieved the desired effect they should expire surely?
Raising taxes on those earning $ 1million or more per year will not impact the New York luxury real estate market negatively, if this is part of a FISCAL CLIFF deal that addresses spending in an aggressive, yet intelligent way: a good deal will spur the economy and markets and easily compensate for the loss in net income. A good deal will be focused on JOB CREATION: this is the ultimate cure for the ailing economy: once there are fewer citizens draining government tax dollars, earning an income of their own and spending/consuming we will be well on the road to a strong recovery. But only then.