Sunday, October 12, 2008

A warning

Taxing the rich, while politically popular, is not very wise. It has adverse economic effects. In normal times, those effects are minor, and it would be wise of Republicans to spend their political capital trying to rid the economy of other laws and regulations that hamper the economy more than high tax rates on the wealthy. However, these are not normal times. Potentially, the most devastating thing the Democrats could do if they get unchecked power is to excessively raise taxes on the wealthy.

The wealthy may may consider the new taxes. Next, they might consider the financial condition of the United States. And then, they might consider the burden of additional taxes they will be expected to bear in the future. And then, they might consider that they have to wealth necessary to migrate. After all this careful consideration, they might decide that the financially wise thing to do is emigrate. If they do it in large numbers, it would be economically devastating to America.