We’re always hearing from politicians that the battle is ‘Wall Street vs. Main Street.’ The politicians promise to protect Main Street from Wall Street.
In a fog of ignorance, it might sound appealing and it certainly generates applause. But in truth, there is no such battle.
Wall Street consists of people who make money off the profits of businesses, including companies such as Wal-Mart. These companies make profits only because millions of people, many of them with low incomes, buy products and services at those companies.
If Wall Street suffers, it’s because ‘little guys’ are not spending. If consumers are not spending, it’s because of an economy that is less than healthy, often because of government intervention and taxation.
Case in point, from a recent Bloomberg News report:
Wal-Mart Stores Inc. had the worst sales start to a month in seven years as payroll-tax increases hit shoppers already battling a slow economy, according to internal e-mails obtained by Bloomberg News.
Wal-Mart and discounters such as Family Dollar Stores Inc. are bracing for a rise in the payroll tax to take a bigger bite from the paychecks of shoppers already dealing with elevated unemployment. The world’s largest retailer’s struggles come after executives expected a strong start to February because of the Super Bowl, milder weather and paycheck cycles, according to the minutes of a Feb. 1 officers meeting Bloomberg obtained.
Americans are continually led to believe, by their elected leaders, that trillions of dollars in debt can be contained by taxing ‘the rich’ another percentage point or two. They won’t even feel it, we’re told. That’s actually a myth, as we can plainly see. Payroll taxes are going up. The Congress has, in the past, talked of additional, new taxes that will affect everybody—such as a value added tax (like the Europeans have) or a national sales tax. Even without all the new spending the federal government continues to do, we would have needed new and higher taxes on everyone in order to finance the massive government we had before. That’s what debt means: It’s an objective indicator that government is spending way more than it takes in.
In my home state of Delaware, Medicaid reimbursements were recently cut by 33 percent for some health care providers. A lot of people in this state, as in others, are unemployed and therefore are eligible for Medicaid coverage. Even more will be on Medicaid with the implementation of Obamacare coming in phases. How good is all this government coverage if medical care providers are forced to take a huge pay cut? Would the lawyers, politicians or academic professors at universities who foist these laws on us ever take a pay cut of that magnitude? Would auto labor unions permit one? I don’t think so. How much do you think doctors are going to take, and what does this mean for patients who (thanks to government prevention of a free marketplace in medicine) depend on this form of coverage?
We’re told, over and over again, that government redistribution of wealth — which is what most taxation is — represents the morally good. If all this taxation and redistribution is so morally good, why is it so damaging in practice? I would think that something morally good would lead to benevolence and happiness for human beings, not frustration, stagnation or ultimately ruin.
If it’s really so easy to slash the debt and deficit by merely raising the income tax by a point or two on a tiny segment of the population, then why do the debt and deficit continue to go up as politicians continue to spend as if there’s no tomorrow—or no five minutes from now, for that matter?
Sooner or later, something more than ‘taxes on the rich’ will have to be considered. We’re already raising taxes on the rich. It’s obviously not enough. If Wal-Mart begins to flounder, that’s a real indication of how much ‘the little guy’ actually does need a thriving market economy in order to survive.
Taxing “only the rich” is a lie. Everyone who works is taxed in some form, as the payroll tax reminds us. Everyone is affected by everyone else being taxed. Even those who don’t work or pay taxes are affected by a declining economy, or an economy that does not grow like it otherwise would have.
It’s not rich versus poor, and it’s not ‘Wall Street’ vs. ‘Main Street.’ It’s the people versus their government.
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