Sunday, December 05, 2010

More On The Stupidity Of Taxing 'The Rich'


This time, from my pal over at The Pagan Temple in a nifty piece entitled, "If I had A Hammer Factory." Here's a slice:

Even if I qualified as a small business, I would not want taxes raised on big businesses. Altruism has nothing to do with it. It's all about self-interest. As a small business owner, I am going to be dependent on the health and vitality of big business, somewhere down the line. If their taxes are increased, on top of their already burdensome regulatory requirements, they are going to pass that cost on to me. So I'm going to have to pay more for the equipment and supplies I depend on them for.

What to do? Well, I can find a cheaper supplier, probably from overseas, maybe or maybe not an American manufacturer who has relocated to China or some other foreign country, or it could be a business which is wholly owned by foreign entities. I won't care one way or another. All I care about is getting my parts as cheaply and still of as high quality as I can.

I can also refrain from hiring new employees. If things get too bad, I might even lay off one or two. Or maybe more. Let's face it, in this economy what workers I retain will gladly work overtime if needed, and even at time and a half it is cheaper for me to go that route than it would be to hire new people, with all the expense of training, new paperwork to file, other federal obligations to pay out for each new employee, etc.

Or, I can simply raise the price of my products, which means I am probably going to lose some customers, or in some cases where I retain some customers, I very well could cause other businesses to lose those customers patronage. If my services are considered more vital for some than dining out, or seeing a movie, or buying new clothes or household furnishings, sporting goods, etc., then those businesses in turn will have to make the same kinds of adjustments I will be making due to losing other customers who can, quite frankly, do without my services if necessary.


It gets even better later on..read the rest here.



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2 comments:

The Pagan Temple said...

Thanks, I'm glad you liked it. The reason I wrote it was because, for some reason, most Republican conservative pundits don't seem to want to go to a great deal of trouble to explain this stuff. They'll say raising taxes on income over 250,000 is raising taxes on small business, the dems will say no, it's just on "the rich" and it ends there. Why do they let them get away with that?

I honestly don't think most people, or at least most Democrat voters, and probably most independents (hell, probably most GOP voters) don't really understand the interconnectedness of big business and smaller business, how what affects one for good or ill similarly affects the other.

Maybe these GOP politicians are afraid it will make them look elitist if they say small business owners want to get rich, or live a prosperous life style even though the people that work for them can't afford to send their kids to private schools or live in the best neighborhoods.

But who's going to start a business, invest their hard earned money in it, risk going under and losing everything so they can live as good as their janitor?

The important thing is if that if the business owner doesn't do good enough to stay in business the janitor is standing in the unemployment line.

B.Poster said...

Pagan Temple: As a part owner in a small business and someone who knows and works with many other small business owners, I can assure you have nailed this!!

It should be pointed out that the "rich" are by their very nature much more moblie than the average person. They can transfer their wealth and themselves to any place in the world. Given the incesant demonization of them coming from the Democrats and their allies in the media, as well as the complete lack of interest in their situation being shown by the Republicans, one wonders how long they it will be before they pack up and move them and their income producing assets and abilities to another location in the world, a location who will appreciate them and what they have to offer.

The top 2% of income earners account for roughly 33% of the spending that takes place in the US. Not good if this disappears. We want to grow our economy. We want the "rich" to spend and to invest. At least we should.

Could the complete and utter disrespect and mistreatment of these people have something to do with why many business interests are reloacting to other countries? I think it does.