Sunday, December 12, 2010

Argument Against Tax Cuts For the Rich?

In his infinite wisdom, in an interview on FOX News, Democratic Senator Jim McDermott (WA) made an argument against the Bush tax cuts extension for the rich: The rich do not create any jobs. They just put their money into their bank accounts and keep it there... 

In contrast, the unemployed people spend their unemployment money immediately. They buy food in the grocery stores or 711s. They buy gasoline, pay their mortgage and keep the economy going. 

The Senator forgot to mention that the wealthy, even if they do not directly create any jobs, also spend their money on groceries. They not only buy gasoline, but are more likely to buy another car. Or a boat. They may not be shopping at Wallmart, but help the employees of Neiman Marcus, Bloomingdales and Sacks 5th Avenue keep their jobs. They enjoy fine dining and support in this way the restaurant and catering industry. They travel, stay in fine hotels, play golf, visit spas. With their lifestyle, the wealthy make sure that thousands if not millions of people in the service industry keep their jobs. The wealthy enjoy arts, music and theater. This not only helps keep the artists, actors, opera singers and symphony orchestras employed, but most importantly, stimulates the culture in the economically difficult times. 

While many people may be quick to condemn the rich for their sometimes excessive lifestyles, many also forget that it is the rich who engage in philanthropic activities and who support the cultural and learning institutions in the country. 

Just like not all the long-term unemployed people are simply lazy, not all the rich people are crooks who got their money in some illicit way. Like no other country, America still offers genuine chance of upward mobility. Hard work, creativity and ingenuity are rewarded and fortunes are built - maybe not over night - but most certainly in a lifetime. The American dream is not dead. One just have to keep in mind that capitalism is the only economic system that genuinely stimulates and rewards the will to succeed.

By Dominique Allmon ©2010

P.S. We must also keep in mind that some of the policies may be bordering on pure injustice. While the very rich and the corporations enjoy tax exemptions, the middle class is burdened by the ever rising taxes. A tax reform is due and the complicated tax laws must be simplified. 

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