As our government continues to deficit spend, what, 40% of every dollar?, the bill that is yet-to-come comes with a state and federal combined price tag of 62%. Sure sounds like a European socialist basket case economic scenario, doesn't it?
If the Democrats' millionaire surtax were to happen—and were added to other tax increases already enacted last year and other leading tax hike ideas on the table this year—this could leave the U.S. with a combined federal and state top tax rate on earnings of 62%. That's more than double the highest federal marginal rate of 28% when President Reagan left office in 1989. Welcome back to the 1970s.
What's that giant sucking sound? Business headed to Europe and other tax-friendlier nations, is what it is:
What is particularly worrisome about this trend is the deterioration of the U.S. tax position relative to the rest of our economic rivals. In 1990, the highest individual income tax rate of our major economic trading partners was 51%, while the U.S. was much lower at 33%. It's no wonder that during the 1980s and '90s the U.S. created more than twice as many new jobs as Japan and Western Europe combined.
And a solution? No more, says Moore:
Perhaps there can still be a happy ending to this sad tale of U.S. decline. If there were ever a right time to trade in the junk heap of our federal tax code for a pro-growth Steve Forbes-style flat tax, now's the time.Where is our Steve Forbes-like candidate?
We shouldn't be surprised that our government is run by Robin Hood-wanna-be economic illiterates.
Cross posted to LCR, Rational Nation.
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