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Obama's proposals on taxation bear some serious questioning. The blind "tax the rich" approach will ultimately be as harmful to the economy as the blind cut taxes to the bone (and then some) approach we've seen under Bush.
For instance, Obama promisses to leave tax rates of middle income people and especally retirees alone, even offering tax cuts or rebates. Obama also says he will tax the RICH by increasing capital gains taxes.
But that approach ignores the fact that many middle income people use capital gains from investments to supplement their income. This is especially true of retirees. Additionally, many retirees and soon-to-be retirees have, as part of their retirement plan, the idea of using the equity in their family homes by selling and moving to a condo or smaller home. Capital gains, in addition to the housing market crunch, would do significant harm to those plans. And most of those who want to use family home equity for retirement income cannot be described as rich.
In short, the two ideas are completely incompatible with each other. He cannot tax only the rich by increasing capital gains taxes. He cannot tax only the rich by taxing dividend income, as that too is used by many middle income people. His plan will increase taxes on many middle income people, especially retirees who are using their investment portfolios and housing equity as retirement supplement.
For instance, Obama promisses to leave tax rates of middle income people and especally retirees alone, even offering tax cuts or rebates. Obama also says he will tax the RICH by increasing capital gains taxes.
But that approach ignores the fact that many middle income people use capital gains from investments to supplement their income. This is especially true of retirees. Additionally, many retirees and soon-to-be retirees have, as part of their retirement plan, the idea of using the equity in their family homes by selling and moving to a condo or smaller home. Capital gains, in addition to the housing market crunch, would do significant harm to those plans. And most of those who want to use family home equity for retirement income cannot be described as rich.
In short, the two ideas are completely incompatible with each other. He cannot tax only the rich by increasing capital gains taxes. He cannot tax only the rich by taxing dividend income, as that too is used by many middle income people. His plan will increase taxes on many middle income people, especially retirees who are using their investment portfolios and housing equity as retirement supplement.