What is wrong with this Argument? Especially read the comment from Ironman after the Post. There is a relationship between median household Income and tax rates. What can that tell Us? Median household Income remains a relatively stable element throughout most business cycles, there being a real drag to Income change, depletion or Gain over the wide range of households. Personal Income and Corporate Income make vast Gains within economic booms, and are highly resistant to added taxation. On the other hand, Personal Income and Corporate Profits only reduce in magnitude during the deepest of the business downturn, and consistently remain the first to recover their advantage. I contest Mark Perry’s supposition that federal revenues are likely to grow at their current rate, when Business, Corporation, and Personal Income are at the outer shell of their taxable Income, and a whole list of tax remissions to protect the Wealthy from taxation will begin to drain their contributions to tax revenues.
Spending Restraint and Pro-Growth policies will not balance the budget. Spending Restraint will only reduce the fair value median Income households obtain from Government Spending, actually granting the higher Incomes that value in tax cuts. Pro-Growth policies provide advantage to the higher Incomes, as the median Income households substantially maintain their contributions. Pro-Business economists like to cite Welfare programs as Wasteful, but I have never witnessed higher Incomes rejecting Social Security, Medicare, or Unemployment Insurance where they have been eligible for such a program. They are often first in line, already with registered legal representation. I will devote the following paragraph to effective Spending Restraint.
Pick a Limit–any acceptable Limit–above which higher Incomes must pay for their own subsidies; I would suggest around $100k per year. Hereafter, no one draws Unemployment Insurance unless his Income falls below the Limit. All Incomes above the Limit must Sign a mortgage contract with the Social Security Administration, stipulating they will receive no monthly benefit if their Costs to the program have exceeded their contributions from Work years. I called it a mortgage because All above the yearly Limit must pay a yearly percentage of their Income–I will bring up the 8% of gross Income before Taxation for all medical expenses incurred by payment by Medicare of their medical expenses; said mortgage coming due upon their deaths, and the full amount will come due from their Estate. All Personal Incomes, Business Incomes, and Corporate Incomes must make a yearly payment of $250k to the Unemployment Insurance Fund, if their Income Tax Return grants them more than $1 million of tax reductions below the stipulated rate for their Income level. Am I a Stone in their Shoe, or What? lgl