Neal Boortz: Why taxing the rich brings poor results

Clearly those rich people who aren’t struggling to keep their homes and whose retirements are secure are just lucky, right? And since they were lucky, and you weren’t, it’s only fair that the government take some more from them and give it to you, right?

OK, let’s take a good look at this tax-the-rich stuff. Would it work? Is raising taxes on the rich a bone thrown to the wealth envy crowd, or is it serious economic policy?

No. I’m not going to go into some long song and dance here about how those evil people making more than $250,000 a year are actually the nation’s top job providers ... if you haven’t figured that one out yet, you never will. Let’s just stick to numbers.

First: How much money do the top income earners make, and how much of the total income taxes collected by the federal government do they pay? To be in the top 1 percent in 2010 you needed to make $380,354. Not bad. The top 1 percent earned 20 percent of the total adjusted gross income for the country. They earned 20 percent, but they paid 38 percent of the taxes. If that doesn’t fit your definition of “fair share,” I would surely like to know what does.

President Barack Obama, though, is talking about raising taxes on households that earn more than $250,000 a year. Census Bureau stats for 2006 (maybe our last really good economic year before the recession) showed that there were about 2.2 million households in this category. To cover Obama’s $1.1 trillion projected deficit for 2012, each of these households would have to cough up an average of $500,000 in federal income taxes. Yeah, that works. If you wanted to eliminate the deficit with just tax increases on the million-dollar-a-year crowd, they would each have to pay $6 million in taxes. They don’t have it.

Perhaps Walter Williams presents the numbers in a more compelling fashion. Williams points out that if Obama managed to impose a 100 percent federal income tax on every dollar any household earns above $250,000 — just take it all — the government would collect about $1.4 trillion. That would give us 141 days before the government ran out of money. So, we need more money. How about the evil corporations? After all, you don’t have to wait long on any given day before you hear some liberal screaming about “corporate profits.” So, take every penny of profits from the Fortune 500 and, as Williams points out, you have another $400 billion to spend. That pays for our government until close to the end of June. We’re not even halfway through the year. Plus, since you’ve seized all the profits from the Fortune 500 corporations, and most of the earnings of America’s small businesses, where do you think our economy is going to go from there?

There’s one more huge problem with the Democrats “tax the rich” mantra. Democrats want you to believe that these high-achievers are just going to keep on doing what they’ve been doing no matter how much you raise their taxes. People who have the wherewithal to earn this type of money also have the means to shift their economic behavior with the tax winds. That’s why tax cuts often lead to increased tax revenues, and tax increases don’t.

But no matter — it’s the pandering to your jealousy that really counts.

Listen to Neal Boortz live from 8:30 a.m. to 1 p.m. weekdays on AM 750 and now 95.5FM News/Talk WSB.

His column appears every Saturday. For more Boortz, go to boortz.com