The views expressed in any article published in this blog are the author's own and do not necessarily reflect the views of Joseph Foster or Bob Lupoli.

Wednesday, February 29, 2012

Raising Capital Gains = Less Money for U.S. Gov't

Joe:  an interesting point to ponder posed by Michael Barone on raising capital gains. –Bob
By Michael Barone
....
ABC's Charlie Gibson asked candidate Obama if he would raise capital gains taxes even if, as in the past, that brought in less revenue to the federal government.


Yes, said Obama. "I would look at raising the capital gains tax for purposes of fairness."

Ponder that answer for a moment. A candidate for president -- president now -- said he wants to take more money from people who earned it even though doing so would produce less money for the government.

The philosophy that has to be behind that answer is also behind the Obama administration budgets that have proposed capping the charitable deduction for high earners. The clearly intended result would be a massive transfer of money from the voluntary sector of society into government.

Alexis de Tocqueville in the 1830s identified the voluntary sector as a unique feature of American democracy, one that gave it strength and character. He compared it positively with his own France, where centralized government stifled initiative and innovation.

The cap on charitable deductions has gone nowhere in Congress, where many Democratic members undoubtedly heard protests from their friends and supporters in the voluntary sector. We can see where that proposal leads from the Obama mandate that voluntary-sector organizations must buy health insurance that finances procedures their leaders consider deeply immoral. Centralized government will decide what's moral, and you'll be forced to pay for it.

Higher tax rates on high earners, even if they produce less revenue, are an attempt to centralize power in government and to limit the autonomy and countervailing power of individuals in the voluntary sector.

Which is why the liberal bloggers cheer them on. And why they eagerly join the Obama White House in demonizing the Koch brothers, who donate large sums to conservative causes. (Disclosure: I have spoken at two Koch conferences and was reimbursed for travel expenses.)

The Obama Democrats don't want their funders like George Soros getting competition from the likes of Charles and David Koch.

Similarly, the prospect of Republicans spending as much money as Democrats (unlike 2004 and 2008, when Democrats spent more) led Obama to declare inoperative his denunciations of superPACs and to create his own, with Cabinet members authorized to raise money for it.

This election is a contest between a Democrat who wants to make this country more like Tocqueville's France and Republicans who want to keep it more like Tocqueville's America. The liberal bloggers are rooting for France.

Michael Barone, The Examiner's senior political analyst, can be contacted at mbarone@washingtonexaminer.com. His column appears Wednesday and Sunday, and his stories and blog posts appear on washingtonexaminer.com.

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