One of the main issues this year is “tax cuts for the rich.” Democrats are overwhelmingly against them and want to increase taxes on people who make too much money. The question is what impact that would have on such individuals.
None at all say the class warriors.
Yes, it will reduce work effort argue others, including Harvard professor Greg Mankiw in this piece.
Mankiw is right, but I don’t think work effort is the crucial point to make against tax increases. The question is whether the individual who earned the money will do more useful things with it than the federal government will. Individuals spend and invest money with considerable thought as to relative costs and benefits. On the other hand, politicians just spend (yes, sometimes they call their spending “investing” but that’s deceptive) and often do so in ways that are useless (pork barrel projects for the home district that no one would voluntarily back) or even harmful (such as hiring more IRS enforcers). The more resources that are directed by politics, the poorer we become overall, even though a few individuals and organizations profit handsomely from government spending.
