A caller on Friday’s show asked an interesting question about confiscating all income made by people earning more than $1 million in this country. I believe his question was, if that were done, how long could the government operate?
It should come as no great surprise that the answer is, not long. I can’t brake it down into days, but thanks to a marvelous editorial entitled “The 2% Illusion” in the February 26, 2009 Wall Street Journal, I can give you an idea. For those of you who think that this country’s economic woes would be solved if we just raised the taxes on the wealthy, please, think again, and read the entire editorial.
The last year for which statistics are available is 2006, significant in the fact that times were good, the economy was rolling, and those “evil” Wall Street financiers that we are now told to hate were making millions. According to that article, had the federal government taken all of the taxable income of all of the income taxpayers earning over $500,000, (no typo, that’s a half a million) the federal government would have only taken in an extra $1.3 trillion. Translation: that is less than one half of the 2006 federal budget, or, using another point of reference, not even close to the amount of money necessary to cover the cost of the first two spending bills passed by Congress this year.
The article took the analysis further, though. So if the above statistic doesn’t scare you, what follows will. This administration plans to spend more than $4 trillion in fiscal 2010.
Even taking every taxable “dime” of everyone earning more than $75,000 in 2006 would have barely yielded enough to cover that $4 trillion.
Hopefully, these statistics demonstrate that what we are hearing from this administration is either folly, or a flat out misrepresentation of the facts. Raising taxes on the “wealthiest” 2% of Americans will not, as the President claims, pay for his agenda, even if the government took 100% of their taxable income. Given that indisputable fact, where do you think the money will come from? If you guessed every man, woman and child in this country for generations to come, once again, go to the head of the class.