Hillary Clinton has been on a roll this week, if only as far as taxation is concerned. Never content just to get close to the Bernie Sanders wing of the Democrats, at least during primary season, she is trying to be louder in demonizing successful Americans.
Monday, for example, she called for a 4% surcharge on the income of Americans who earned $5 million in the previous year, which she called -- I'm not making this up -- a "fair share surcharge." As if to stress the point, she reiterated a January 2 statement in which she insisted that she would do what it takes to ensure that the "super-wealthy are truly paying their fair share" in taxes.
Now, I have only envy for those who are successful enough to earn $5 million in a year. Bully for them. They have plenty of accountants good enough to beat their tax bill down to as little as the law allows.
But I certainly will take their side in this one, and so should you. There are several reasons, and here are a few.
First, they are already paying their fair share. Their "fair share" is, by definition, what the law says they should be paying. Follow? If they do not pay what the law says they should, they end up fined or jailed. If you think that amount is not enough, as clearly Mrs. Clinton thinks, then you could say that the law needs to be changed, but you cannot say they're not paying their fair share.
Second, one could readily say, as I do, that they are paying more than they should be, and that would seem rather obvious. The marginal federal rate long before you get to a $5 million income for a year is close to 40%. I defy you to explain to me how, in a free country, the Federal government can possibly justify seizing as much as 40% of any transaction, whether income, savings, business or export.
Third, I submit as evidence the utter unwillingness of Mrs. Clinton, or the current White House team, or any other Democrat to make a case for what the highest tax rate should be and at what point they will shut up and say that we've hit the top rate. I believe I made this case reasonably well in the past, but I hold firm that neither Hillary nor anyone else will ever say precisely what "fair" is, in the context of a specific rate. Ask her the question, "What is the highest rate that any government should ask someone to pay out of his or her income?" Just try. Valerie Jarrett wouldn't give a straight answer in the link I just gave you, and neither will Hillary; that would impose a cap on their rapacity.
Fourth is semantics. The "wealthy" do not pay tax on wealth (for the most part). People pay tax on income, and having a high income does not, a priori, make you "wealthy". High income tax rates actually prevent people from becoming wealthy. I guarantee you, if I could be allowed to save most of my income for the next three years, I would not be wealthy, but at least I could retire. Calling people "wealthy" when what is meant is "having a high income in the previous year" is not only innately false but intentionally deceptive -- Hillary doing what liars do.
Finally, and perhaps most importantly, fairness has nothing at all to do with the tax code and never should. Income tax rates are not installed to produce fairness; they are to raise money from which to operate the Federal government. The only reason to use the term "fairness" is if you believe in redistributing money from those who earned it to those who did not. The tax structure that is best for the USA is not the one that is thought most fair by the Democrats. No, it is the one that produces the most revenue in the least intrusive manner possible.
Whether that is a completely flat tax, a form of which I have long advocated, or something akin to the plan put forth by candidate Dr. Ben Carson, the point is that tax law should be solely focused on producing the most revenue with the least intrusion. If that is a flat rate after a fixed income exemption -- or almost anything that can be codified in three pages, as candidate Carly Fiorina has suggested -- the tax law should be far, far less about perception or fairness.
Liberals are completely about form and completely not about substance. They have to be; liberalism doesn't work, so liberals have to try for "show" to win elections, since they can't tout achievement. Here we have Hillary Clinton, tiredly demonizing the successful as not paying their "fair share" and trying to out-Bernie her competition for the nomination, at least if she is not in prison by then.
I get that -- what else can she do? Don't we all hate the "rich"? Find a convenient target and try to use it to outflank her opposition for the nomination she believes she is entitled to.
But please, Hillary, can the "fair share" crap. Nobody takes you seriously on that.
Copyright 2016 by Robert Sutton
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