The “Fiscal Cliff” is the People’s Fault

Both sides — the hapless Republicans and the taxing Democrats — take it for granted that tax increases will help with the national debt and deficit.

They differ only on specifics. Republicans call for “closing tax loopholes,” which is simply another way of saying, “Make it harder not to pay taxes.” That’s for all practical purposes a tax increase. And Democrats, as well as some Republicans, simply call for all out tax increases.

Doesn’t it occur to these professional politicians that the more difficult you make it for somebody to do something — e.g., make money — the less of that activity will take place?

It stands to reason: The more expensive it becomes to make money, the less money making there will be. The less money making there is, the fewer taxes will be collected. With government entitlement programs skyrockting through the roof in their costs, there will be even less money to fund them, the more we raise taxes.

The error here involves a failure to understand both human motivation and economics 101. Since a lot of these people in the government are both intelligent and well-educated, I don’t see these mistakes as innocent or ignorant ones. They’re simply evading what they know to be true. In hopes of … all of this working out somehow, at least until the next election cycle or budget cycle (at which time the same erroneous reasoning will be employed, only with larger deficits.)

The major reason we have such deficits and debt — other than the cost of entitlement programs such as Medicare — is that the economy has been failing to grow sufficiently to keep up with the entitlement expenditures. “Taxing the rich” is a popular policy at the ballot box, but facts cannot be voted away. The fact remains: The more you tax people, the less economic productivity there will be. The more you tax richer people out of proportion to everyone else, the more you harm economic growth in a disproportionate way.

The only reason that politicians get away with this is because it’s considered immoral to let people who earn more hold onto what they earn. Somehow, the reasoning goes, the more you earn, the more you are obliged to give away to government officials. When economic growth has slowed or stopped, the same reasoning goes, the MORE we must (1) tax and (2) close loopholes and generally increase government regulation and “oversight” of the economy.

The most incredible thing about watching the latest and worst yet spectacle in Washington D.C. is watching supposedly intelligent people evade these facts. They actually seem to believe, or at least act as if they believe, that punishing the rich for being rich will even put a dent in our trillions of debt and deficits.

The fact is: It cannot and will not happen. Go ahead. Raise taxes through the roof. If you think this will cause the deficits to close and the economy to soar, I guess this explains how the system of freedom created by the likes of Thomas Jefferson and James Madison degenerated into the travesty of “President Obama.”

The Republicans may be the stupidest of all. On the one hand, they claim that we must submit to the election results and allow taxes to increase. On the other hand, they oppose allowing the current sequestration law known as “the fiscal cliff” go into effect come January. Why? Because the sequestration law will massively increase taxes. But if the law is wrong because of increasing taxes, then how is increasing taxes (and “cutting loopholes”) supposed to be any better? It’s like saying, “The problem with the economy is we have too much economic freedom. But we cannot let go of our economic freedom.”

These idiotic Republicans and Democrats are, sadly, a mirror for the mainstream of the American people. The American people want their entitlements. They want freebies for others, for themselves, or both. But they don’t want to pay for them. They’re telling politicians, “Keep those programs. Don’t you dare touch them. Obama is right we should have even more. Yet cut that budget and get rid of that debt — now!” It’s beyond illogical and it’s beyond even insane. It’s an intellectual evasion of epic proportions.

The national credit card is morally and fiscally unsustainable if not incomprehensible. The people don’t like this fact, but they don’t want to do anything about it. Hence, the spectacle of the “fiscal cliff” fiasco.


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