Taxation and money-printing are the fuels that feed the government beast.
Money-printing causes the hidden tax of lost buying power for all the monetary units; it inspires malinvestments, and leads to the boom-bust cycle so well explained by the Austrian School of Economics. But, often, the majority of the population don’t recognize the malfeasance while the government and central bank are engaging in it, most folks only recognize the effects in higher prices, layoffs, and economic depressions.
Likewise, the taxers either couch their acquisitive desire for more money and power in the vainglorious envy-rhetoric of Marx – that being the “take stuff from those you think have more than you do” – or they hide the tax increases by forcing them onto sectors of the economy that many Americans either miss, or think of in terms of “protectionism.”
Thus, it’s no surprise that Kamala Harris wants to explode the debt-driving welfare state by offering $25,000 home payments to first-time buyers and wants to shift the burden of medical bills from those who got the medical care to others who did not.
And it’s no surprise that she wants to weigh down the economy and harm consumers with even more burdensome taxes, a burden that the New York Times reports is estimated to cost $5 TRILLION over 10 years.
Indeed, as Eric Revell reports for Fox Business, Harris is intent on driving more U.S. companies out of the country and hiking the costs of consumers by pushing up to 28 percent the corporate tax rate that Donald Trump and Congressional conservatives in 2017 brought down from 35 to 21 percent.
And Breitbart’s Sean Moran digs into more of what Harris is pushing:
“Harris also claimed she would uphold President Joe Biden’s promise to not raise taxes on those who make $400,00 or less per year. Despite this claim, the Biden-Harris administration has increased Internal Revenue Service (IRS) enforcement, which is estimated to take $20 billion from working-class Americans.”
But wait, there’s more. If you would like to sell stocks, or invest in stocks or ventures that offer dividends, watch out…
“Harris’s economic proposal would also raise the capital gains and dividends tax more than twice as high as China’s, or 44.6 percent. China has a capital gains tax of 20 percent.”
And Moran quotes the hard-working folks of Americans for Tax Reform, noting:
“ATR wrote:
‘China’s capital gains tax rate is 20%. Is it wise to have higher taxes than China?
Under the Harris plan, the combined federal-state capital gains tax exceeds 50% in many states. California will face a combined federal-state rate of 59%, New Jersey 55.3%, Oregon at 54.5%, Minnesota at 54.4%, and New York state at 53.4%.”
And even if people don’t sell something, the government under Harris will adopt Liz Warren’s favorite fantasy and tax "rich" folks for what they oxymoronically call “unrealized gains.’”
You got it. No sale and no price affixed to any sale, just the government thugs studying you and your property, and telling you to hand over even more cash. Enjoy seeing the taxes rise as inflation pushes up the "unrealized appreciation" of your stuff...
“The plan calls for an annual 25 percent minimum tax on unrealized gains for those making more than $100 million. Unrealized gains are, on paper, gains in an investment, per Investopedia. Gains are only ‘realized’ when an investor sells an investment for more than its initial price.’”
Which reminds us of one of the key lessons from the Austrian School, which is that only in a free market, upon the point of the market participants agreeing to buy and sell, is a price revealed and offered to others so that they can adjust their own market behavior. Personal preferences and valuations can fluctuate from person to person, and hour to hour even on an individual level, and, thus, the ethical approach of leaving one’s neighbors in peace also is the constructive economic position to allow for market functionality.
Related: Harris Pushes Price Controls, Nutty Central Plans, and She Is Not Alone
Don’t expect Harris or other collectivists to either recognize that fact or care about the ethics of arrogant, government-backed theft.
Moran also notes:
“Other major Harris tax increase proposals include:
- Having small business owners pay taxes on their individual tax returns, up to 39.6 percent from the current 37 percent
- Imposing a second “death tax” — a mandatory capital gains tax at death — in addition to the current death tax
- Imposing a 21 percent global minimum corporate tax rate, which goes beyond the Organization for Economic Development’s (OECD) current 15 percent global minimum tax rate
- Quadrupling the tax on stock buybacks, which would impact Americans’ 401(k)s and other retirement accounts
- A 30 percent federal excise tax on electricity used in cryptocurrency mining
- A $37 billion tax on American energy
- A 32 percent increase in Medicare taxes”
Curiously, Harris’s desire to target the “electricity usage “ of crypto miners neglects to consider that those miners already pay for the electricity, just like everyone in the market does, and it neglects to consider that the US government uses vast amounts of electricity to monitor us, and will increase that need for electricity to keep track of those eeeevil crypto miners.
Her plans are acquisitive and immoral, economically disastrous and, as noted above, often hidden behind either the rhetoric of “tax the rich” (whatever the politicians define as “rich” this week) or behind a primary business target, thus hiding the predation from the sight of many unknowing consumers, themselves.
It’s grist for the mill for anyone who wants to justifiably criticize her immorality and her lack of economic understanding, but it is not something one ethically can mention without also noting that, while Donald Trump would keep the corporate tax where it is and would not institute many or any of the other onerous taxes Harris proposes, he proposes a return and amplification of taxes that he instituted in his previous term, and which also sucked massive amounts of money from our pockets.
As Erica York reported for the Tax Foundation in June, Donald Trump’s political pursuit of tariffs on products such as steel, aluminum, washing machines, dishwashers, and many goods from Chinese sellers, to name a few, placed a massive burden on the economy.
“The Trump administration imposed nearly $80 billion worth of new taxes on Americans by levying tariffs on thousands of products valued at approximately $380 billion in 2018 and 2019, amounting to one of the largest tax increases in decades.”
And she notes, as we have, at MRCTV, that Biden has continued the tariff-tax folly, sucking an additional $3.6 billion out of our wallets and the budgets of domestic business people who rely on foreign goods to keep their own production costs low and please American consumers.
But that is not all. This tariff-driven drain on consumers (both end-buyers, and domestic manufacturers trying to maintain productivity) had a multiplied additional drag on the overall market values of US companies.
In a 2022 Forbes report, Stuart Anderson wrote about a fascinating study conducted by a team of economists at NYU and the Federal Reserve Bank of New York. In it, the researchers investigated closely correlated increases in US tariffs, Chinese retaliatory tariffs and restrictions, the effect on US manufacturers and exporters, and changes of market valuation for those businesses.
The findings are consistent with the increases in costs, drags on productivity, and overall costs to consumers:
“’The results suggest that markets interpreted the impact of the tariffs as much more negative than what economists initially estimated,’ said David Weinstein in an interview. ‘Part of the reason stems from the fact that the U.S. tariffs rose significantly in 2019, and the earlier studies didn’t include these higher rates. Moreover, the new analysis suggests that the tariffs’ impact on productivity is likely to be a factor holding down U.S. growth rates. The tariffs protect the least efficient firms and reduced their incentives to innovate while hurting the most successful U.S. firms, reducing their ability to innovate.’”
And, to put it in numbers:
“’The decline in stock market value caused by trade war announcements “amounted to a $3.3 trillion loss of firm value (equivalent to 16% of U.S. GDP [Gross Domestic Product] in 2019).’ That is larger than the $1.7 trillion estimate in the loss of firm value in an earlier paper from the economists.”
Of course, there are multitudinous factors that also can come into play, factors such as other domestic and international policies, but this is a strong indicator of what investors do when they know that an arbitrary political force is eager to increase its burden on domestic producers, and when they know that the tariff-targeted nations likely will inflict damage on U.S. exports.
One of the best analyses of tariffs is James Bovard’s 1992 book, “The Fair Trade Fraud,” and in it, he offers a macro-view of the damage that tariffs do to the U.S. economy, noting that consumers are harmed to the tune of roughly eight times in losses for the profits the protected US companies garner after their foreign competition is targeted for the trade tax. The foreign companies lose sales, the consumers either spend more in the taxed goods or spend more for the higher-priced US goods, and the feds get the loot.
So, both Harris and Trump need to wake up and understand that taxation is theft. They should avoid it, regardless of their vaunted goals to steer the economy in the direction they prefer, and they ought to let us live our lives free of their command-and-control plans.
Conservatives always can keep that mind, regardless of their preferences for candidates.