A modest increase in tax rates for the wealthy will have little, if any, negative impact on job creation and do nothing to hinder economic growth. Rich people don’t create jobs. Demand creates jobs.
One investment banker earning $7,000,000.00 a year will own perhaps 4-5 homes, including one or two that are probably outside the United States. He’ll own or lease maybe ten cars. He’ll pay for the cost of maintaining these major investments, providing employment for housekeepers, gardeners, and other services necessary to keep his empire running smoothly. He’ll have 2-4 children, a couple of finely bred pets, and vacation in places like Zermatt, Tuscany, or Belize a couple of times a year.
Seven million dollars is also the amount that would be earned by one hundred (100) middle-class Americans at $70,000.00 per year. They would own (or rent) at least 100 homes (maybe more) all of which would be within the U.S. They’d own roughly 150-175 cars with a fair portion of them needing a new set of tires, a tune-up, or some brake work. Most, if not all, of these middle-class Americans will own, or be in the market for a couple of TVs, a DVD player, computer, cell phone, refrigerator, stove, lawn mower, edger, leaf blower…an extensive list of essential goods for everyday living. Based on the same statistics used for our investment banker, these middle-class Americans would have 200-400 children that need to be clothed, fed, schooled, and entertained. Then there are the 200 family pets that will need care second only to the kids. Vacations will be at places Like Disney World, the Grand Canyon, or camping at the beach or mountains.
The bottom line? Clinton was right, it’s arithmetic. Middle-class Americans create far more jobs than the super-wealthy ever will.
When Republicans refuse to support a truly balanced approach to responsible fiscal policy, which means increased tax revenue from high earners along with spending cuts, they not only dismiss the wishes of a majority of Americans, they cement their legacy as the primary obstructionists in the most irresponsible Congress in the history of our country.