In predicting that the left may suggest a flat tax on capital soon, in order to booster their anti-1% cred, deflect criticism from Hillary's wealth, and in fact be well intended, what I failed to point out is that it would be detrimental and worsen certain aspects of the economic balance of our society.
It won't work, or happen, as simply as I stated, for the very reason that a 90% income tax on the rich isn't going to work either. Which by the way is the liberal answer to the conservative flat tax.
The reason being is the wealthy have choices now. Unlike fifty or sixty years ago when very much the entire world was in crumples and the United States dominated all, a 90% tax rate on the rich was doable. Where else would they go?
Try doing that today and see what happens! The Cayman Islands couldn't berth all the yachts headed their way.
Consider what businesses are doing today. The corporate taxes here are some of the highest in the world and to escape them companies are finding partners to merge with that share only a slither of a common cause. They're looking in Ireland, Canada and anywhere else where they can find a willing partner and a friendly tax regime. They're are then moving headquarters outside the United States in order to save money on taxes at record numbers.
Outsourcing 2.0.
A flat capital tax would do the same thing, to certain degrees, and that is not only a challenge for the United States and its own income inequality, but its a challenge for the entire world.
What we need to do, and why the GOP needs to get in the game, is have a discussion about how to use the existing tax system to extricate wealth and capital from the 1% in a way that is beneficial to us all and doesn't drive them(the wealth holders) away.
I'm loathe to suggest that the government just tax and spend. Argh!
Let's face it, a flat tax isn't going to happen and a flat capital tax has more of an opportunity, if nothing else, to get another Democrat elected President. Romney lost because of his wealth, Obama didn't have a lot of great ideas on addressing the disparity, he just hammered the idea of Romney being in the 1%.
Take a look at this article in Fortune Magazine,http://fortune.com/2015/04/25/billionaires-versus-big-oil/
What you'll find is the 1% is investing in alternatives to big oil. What you'll learn is that the UN figures the world needs $1 trillion a year in investments to "decarbonize" the global economy.
Where are we going to get that money? Well, the 1% is already doing it on their own, to preserve their wealth status. But even so, their commitments aren't enough.
I've wrote it before and it bears repeating, the GOP is a hindrance in this country when it comes to the tremendous opportunity that green technology presents for American business. Couple that with their defiance on wealth disparity and we could very well miss out on more than we could ever imagine to change the energy game in this world.
However, billionaires are plowing ahead, the GOP be damned
That's an opinion too, of course, but its worth conveying that this Democrat President, the one that beat Romney and who is driving a multi-pronged agenda to establish his party dominance for years to come, just allowed the Department of Energy, "to provide support and access to federal clean-tech R&D to a broad range of private investors and philanthropists. The aim of the program, called the Clean Energy Investment Initiative, is to help wealthy investors mobilize $2 billion in new clean-tech investments." -Fortune Magazine.
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