Paul Ryan's Tax Plan Endangers Capitalism
Under Paul Ryan's proposed tax plan , any American with enough money to live off of his or her investments will have the option to pay no income tax. That's because dividends, interest and capital gains would not be taxed. Estate taxes would also be eliminated, allowing wealthy families to avoid the income tax in perpetuity.
This may sound like "living the dream," but the vast majority of Americans won't be fortunate enough to participate, even if they're keeping their nose to the grindstone. Meanwhile, Ryan's plan increases the national debt for roughly the next three decades , according to a "rosy" analysis.
Students of history may recall that an increasing national debt combined with a regressive tax system are two of the catalysts that spurred the French Revolution -- a period of terrible violence that unwound centuries of social order in a matter of years.
Forget the 99%, It's the 9% Who Matter
Let's imagine that Paul Ryan's tax plan was in place in 2010. Mitt Romney would have paid $177,650 in tax on $21,661,344 in income, according to The Atlantic , while possessing a $200,000,000 nest egg (This amounts to a 0.82% tax rate resulting from Romney's author and speaking fees.)
Now imagine a first-year heart surgeon with no assets, saddled with $600,000 in medical school debt . The doctor would also pay $177,650 in tax, but on $710,600 in income -- the same amount in taxes even though the doctor made 96% less than Romney (and has a negative net worth).
Roger Arnold once explained the 1-9-90 concept as follows, "revolution never comes from the bottom up or the top down. Revolution comes from the 9% becoming disillusioned with the top 1% and identifying more closely with the bottom 90%."
With whom do you suppose this imaginary doctor would identify? Is it not a scary concept that an educated, hard-working surgeon may feel economically punished by his or her ambition?
Why Not Simpson-Bowles?
Paul Ryan voted against the Simpson-Bowles plan . Under this proposal all sources of income would be taxed equally -- dividends, capital gains and wages -- at three respective rates: 12%, 22% and 28%.
In a perfect world , the taxes that you pay would be as rewarding as making a charitable gift (another form of transfer payment). The reward, of course, is that society can grow richer as a whole -- or so argued our Founding Fathers . Remember, our founders did not rebel over taxes, rather, their lack of representation .