# Response to Right-Wing Screed Setting out the Futility of Raising Taxes **URL:** \ **Category:** Great Debates\ **Created:** [November 10, 2012, 7:00pm UTC](https://boards.straightdope.com/t/response-to-right-wing-screed-setting-out-the-futility-of-raising-taxes/640603 "2012-11-10T19:00:21Z")\ **Posts on this page:** 9\ **Page:** 1
**Author:** ![whole\_bean](https://avatars.discourse-cdn.com/v4/letter/w/96bed5/32.png) [@whole\_bean](https://boards.straightdope.com/u/whole_bean)\ **Post date:** [November 10, 2012, 7:00pm UTC](https://boards.straightdope.com/t/response-to-right-wing-screed-setting-out-the-futility-of-raising-taxes/640603/1 "2012-11-10T19:00:21Z")
I’ve seen the bit, excerpted below, in a couple of places on the internet now. This gist is that there’s not enough money out there to tax to cover expenses, or more specifcially, taxing the rich won’t balance the budget–the implication being, don’t raise taxes ('cause it won’t work). Now, I can see a lot of potential problems with this analysis (like, why just the Fortune 500? That’s a fraction of US business). My guess is that it’s a gimmick (that’s not to say budget cuts are not in order, just that the author is poormouthing a little). Can one of you direct me to a good rebutal out there somewhere? If not, would someone like to take a stab at it? The thing: > [@](#): > > As the national debate now focuses on the impending fiscal cliff and the shouts to raise taxes on the rich and continue spending , consider these facts…there’s not enough money there to cover it… the IRS states that approximately 2% of the American households have an income of $250,000 or greater, accounting for 25% or $2T out of the $8T in total household income of all Americans. > > Marginal tax rates on upper income people have varied between 91% and 35%. What if the government took 100% of everything over $250,000. That would bring in about $1.4T dollars enough for (1.4/3.7 \* 365) = 138 days, leaving 227 more days of spending. > > The Fortune 500 companies earn about $400B dollars in profit. If the government taxed all Fortune 500 companies’ profits that would give the government another 40 days at $10B a day. So now the U.S. government could run for 178 days, leaving 187 days to cover. > > If the government confiscated all the property of the 400 billionaires in America – $1.3T dollars, they could run the government for another 130 days, at least for one year, because the billionaires net worth would be already spent by the second year. > > That would take the government up to 308 days of operation. But the U.S. government would still need money for the remaining 57 days. ---
**Author:** ![John\_Mace](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/john_mace/32/185_2.png) [@John\_Mace](https://boards.straightdope.com/u/John_Mace)\ **Post date:** [November 10, 2012, 7:20pm UTC](https://boards.straightdope.com/t/response-to-right-wing-screed-setting-out-the-futility-of-raising-taxes/640603/2 "2012-11-10T19:20:47Z")
Your quote doesn’t explicitly say this, but it seems to strongly imply that cuts in spending are needed no matter what. That is… “raise taxes on the rich and continue spending” I think is meant to say continue spending without any cuts. And it’s true, but the fact is everyone is talking about making cuts, too, so it’s really a strawman argument. The debate is about what the proper mix is, not about fixing the problem solely by raising taxes. ---
**Author:** ![Bryan\_Ekers](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bryan_ekers/32/183_2.png) [@Bryan\_Ekers](https://boards.straightdope.com/u/Bryan_Ekers)\ **Post date:** [November 10, 2012, 7:58pm UTC](https://boards.straightdope.com/t/response-to-right-wing-screed-setting-out-the-futility-of-raising-taxes/640603/3 "2012-11-10T19:58:27Z")
The author of the screed seems to assume the government collects taxes and then permanently “consumes” the money, as if expenditure was like burning firewood or something. ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [November 10, 2012, 8:14pm UTC](https://boards.straightdope.com/t/response-to-right-wing-screed-setting-out-the-futility-of-raising-taxes/640603/4 "2012-11-10T20:14:19Z")
The Fortune 500 collectively made a profit of [$825 billion](http://finance.fortune.cnn.com/2012/05/07/500-intro/) last year (which was admittedly a record), and the total net worth of the Forbes 400 is [$1.7 trillion](http://www.forbes.com/sites/luisakroll/2012/09/19/the-forbes-400-the-richest-people-in-america/). ---
**Author:** ![Ludovic](https://avatars.discourse-cdn.com/v4/letter/l/7ab992/32.png) [@Ludovic](https://boards.straightdope.com/u/Ludovic)\ **Post date:** [November 10, 2012, 9:04pm UTC](https://boards.straightdope.com/t/response-to-right-wing-screed-setting-out-the-futility-of-raising-taxes/640603/5 "2012-11-10T21:04:45Z")
The main reason why only tax increases on the very wealthy are talked about more than on the upper middle class is because they’re more politically feasible. No one is pretending that we can eliminate the deficit just by taxing the upper class. The GOP do this, too, by implying that we need to raise taxes on only the lower half of the country, which also wouldn’t do much to lower the deficit (especially when balanced agaisnt a tax cut for the rich.) Unless I’m missing something and Obama said that we could balance the budget by raising taxes on only the rich. He knows we can’t. We need a combination of broad based tax increases and spending cuts. Every politician knows this. (I did originally say “everyone knows this”, except some ignorant non-politicians out there might still sincerely believe that lowering taxes increases revenue. Actual politicians have read the report that the GOP ordered supressed that explicitly said that this doesn’t work.) ---
**Author:** ![emacknight](https://avatars.discourse-cdn.com/v4/letter/e/3ec8ea/32.png) [@emacknight](https://boards.straightdope.com/u/emacknight)\ **Post date:** [November 10, 2012, 11:34pm UTC](https://boards.straightdope.com/t/response-to-right-wing-screed-setting-out-the-futility-of-raising-taxes/640603/6 "2012-11-10T23:34:24Z")
> [@Bryan\_Ekers](#): > > The author of the screed seems to assume the government collects taxes and then permanently “consumes” the money, as if expenditure was like burning firewood or something. Well, not exactly firewood [![](https://img.youtube.com/vi/VU7cTfdxOkY/hqdefault.jpg "USAF B-2 Stealth Bomber In Action!!!") ](https://www.youtube.com/watch?v=VU7cTfdxOkY) ---
**Author:** ![Ca3799](https://avatars.discourse-cdn.com/v4/letter/c/9f8e36/32.png) [@Ca3799](https://boards.straightdope.com/u/Ca3799)\ **Post date:** [November 10, 2012, 11:43pm UTC](https://boards.straightdope.com/t/response-to-right-wing-screed-setting-out-the-futility-of-raising-taxes/640603/7 "2012-11-10T23:43:24Z")
Also, the issue is paying down the debt is a responsible way, not paying off the debt is 3 months or one year. Most calculations are looking at changes over 10+ years. ---
**Author:** ![Leaffan](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/leaffan/32/299_2.png) [@Leaffan](https://boards.straightdope.com/u/Leaffan)\ **Post date:** [November 10, 2012, 11:58pm UTC](https://boards.straightdope.com/t/response-to-right-wing-screed-setting-out-the-futility-of-raising-taxes/640603/8 "2012-11-10T23:58:39Z")
You know, you just have to look into tax rates in other western democracies to realize that something doesn’t add up. It’s nice to imagine trickle-down economics works, but it doesn’t. Business taxes need to be competitive, or why would companies stick around or even take root, but increasing taxes on people who can obviously afford the increase, as part of the plan to balance the budget is common sense. Are some Americans so daft that they can’t imagine that increasing revenues and cutting spending is necessary at this point? Taxing the poor is a shitty idea, but a reasonable national sales tax would probably work. For decades you’ve sneered about tax rates and energy costs in other countries. As Journey puts it, “Wonder Who’s Crying Now.” ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [November 11, 2012, 12:55am UTC](https://boards.straightdope.com/t/response-to-right-wing-screed-setting-out-the-futility-of-raising-taxes/640603/9 "2012-11-11T00:55:36Z")
> [@Ludovic](#): > > The main reason why only tax increases on the very wealthy are talked about more than on the upper middle class is because they’re more politically feasible. No one is pretending that we can eliminate the deficit just by taxing the upper class. And more importantly taxing the rich has one of the least anti-stimulative effect of all taxes. Higher estate taxes are the only tax increases that have a lower anti-stimulative effect (there is evidence that it actually has a stimulative effect). > [@Leaffan](#): > > You know, you just have to look into tax rates in other western democracies to realize that something doesn’t add up. It’s nice to imagine trickle-down economics works, but it doesn’t. Business taxes need to be competitive, or why would companies stick around or even take root, but increasing taxes on people who can obviously afford the increase, as part of the plan to balance the budget is common sense. > > Are some Americans so daft that they can’t imagine that increasing revenues and cutting spending is necessary at this point? Taxing the poor is a shitty idea, but a reasonable national sales tax would probably work. For decades you’ve sneered about tax rates and energy costs in other countries. As Journey puts it, “Wonder Who’s Crying Now.” The problem with tax competition between industrialized jurisdictions is that it quickly becomes a race to the bottom, one that noone wins over the long run.