Barack Obama, Iconoclast This article appears on http://www.stupidelephants.

com/ As part of the solution to the fiscal cliff, President Obama has proposed letting the Bush tax cuts expire for Americans making over $250,000 per year. In response, Republicans have trotted out their usual defense of the wealthiest 2% of Americans: that they are the job creators who need their tax cutsincluding the very generous 15% tax rate for some billionairesin order to grow the economy and create jobs for everyone, or, as the pithy justification goes, A rising tide lifts all boats. But it has been known for a while now that tax cuts for the rich do not translate into economic growth or job creation: they do not cause any tides to rise; they lift no boats. In fall 2012, the Congressional Research Service, a non-partisan group that provides research for Congress, published a report on the relationship between cutting taxes and economic growth. It concluded thus: The top income tax rates have changed considerably since the end of World War II. Throughout the late-1940s and 1950s, the top marginal tax rate was typically above 90%; today it is 35%. Additionally, the top capital gains tax rate was 25% in the 1950s and 1960s, 35% in the 1970s; today it is 15%. The average tax rate faced by the top 0.01% of taxpayers was above 40% until the mid-1980s; today it is below 25%. Tax rates affecting taxpayers at the top of the income distribution are currently at their lowest levels since the end of the Second World War. The results of the analysis suggest that changes over the past 65 years in the top marginal tax rate and the top capital gains tax rate do not appear correlated with economic growth. The reduction in the top tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie. To put it simply, tax cuts for the wealthy do not lead to a generalized economic benefit for all. No causation. No correlation. No association. But why do Republicans instinctively protest whenever a proposal is made to raise marginal rates for the wealthiest Americans? Two simple reasons: (1) Republicans have a deep dislike for government and what it doesespecially in two areas: regulation of businesses (stifling freedom), and provision of services to the poor and elderly (stifling personal responsibility). It is for this reason that conservatives complain that government is getting too big. This point of view is succinctly (and honestly) expressed by Grover Norquist, the anti-tax president of Americans for Tax Reform who, for over twenty years, has coerced Republicans into signing a document pledging never to raise taxes. He said:

Im not in favor of abolishing the government. I just want to shrink it down to the size where we can drown it in the bathtub. (2) Republicans have a genuine desire to help and protect a certain class of peoplea class that is reliably Republican and supports the party in campaign contributions. In the same report, the Congressional Research Service concludes with the following, emphasis added: However, the top tax rate reductions appear to be associated with the increasing concentration of income at the top of the income distribution. As measured by IRS data, the share of income accruing to the top 0.1% of U.S. families increased from 4.2% in 1945 to 12.3% by 2007 before falling to 9.2% due to the 2007-2009 recession. At the same time, the average tax rate paid by the top 0.1% fell from over 50% in 1945 to about 25% in 2009. Tax policy could have a relation to how the economic pie is slicedlower top tax rates may be associated with greater income disparities. These are the two reasons that animate conservative opposition to raising the marginal tax rates for the wealthy. But although they hate the government, few of them would explicitly oppose taxes on that ground; and although they favor the rich, none of them would explicitly claim protection of the rich as a reason for their tax policy. So they came up with the noble idea that cutting taxes for the rich will grow the economy. Well, it does not. It never did. It never has. And yet the myth persistsand gets repeated oftenagainst all evidence. Many academic papers have been written debunking it, but they have often been dismissed as the work of liberals. When the Congressional Research Service published its own nonpartisan, non-ideological study, conclusively showing that a cornerstone of conservative ideas had no basis in fact, congressional Republicans were furious, and they applied pressure on the Service to withdraw the report. (This, it seemed, was not the time to shine empirical light on to the dark caves of baseless conservative slogans and beliefs.) The report was withdrawn. So, no studies have been able to slay this beast of a myth. No debates have been able to banish it from public life. No man has been able to wrestle it to the ground and keep it buried there. Until now. One man, President Barack Obama, wants to raise taxes on the richest 2% of Americans. He campaigned on it: the first time in a long time that a president has campaigned explicitly on raising taxes on Americansand won decisively, both on that issue and others. For much needed contrast, Republicans have insisted that raising taxes will kill jobs. It punishes job creators, Mitt Romney and many Republicans say. So two clear positions have been taken. The contrasts have been explained. As a last resort, Republicans have tried to belittle the idea of raising marginal rates on the wealthy,

claiming that raising them will pay for only eight days of government spending. And then what do we do after that? they ask. They miss the point. It does not matter whether the revenue generated will be $68 billion or $68 million, or whether it will pay for 8 days or 8 hours of government spending. President Obamas major aim is to crush and obliterate a myth that has gripped Republicans for decades, and hence free them from their fears and delusions. Fears because they have been under the sway of one man, Grover Norquist, for a long time. For the first time in 22 years, Obama will force them to break their pledge and raise taxes on the wealthiest Americans. Grover Norquist will be upset and he will try to recruit primary challengers against the defectors. Some challengers will be successful, most will not. The fears of many will not be realized. Freedom will ensue. Grover Norquist will be removed as a force in the Republican Party. And Republicans will never be the same again. This is doubly satisfying because Republicans spent the last four years comparing Obama to Jimmy Carter, thereby implying that he was weak and destined for failure. Well, he has already transformed the country in major ways, and he is about to transform the Republican Party as well. Delusions because taxes will be raised on the richest Americans and the economy will still grow, and jobs will still be created. If all the Bush tax cuts for the wealthy did nothing to help the economy, erasing them will do nothing to harm the economy. But the biggest benefit will be the clear demonstration, to be seen by all, that raising taxes on millionaires and billionaires will not kill jobs as Republicans have been saying for decades. On the day the Earth dies, Republicans will be convinced of the dangers of global warming; in the meantime, President Obama will force them to abandon their useless tax ideas in the hope of living in the real world of sound economic policy. The justification that they have used to make rich people richer and poor ones poorer will be removed forever Because of Obama. Read more like this on http://www.stupidelephants.com/