Wealth CREATES More Wealth

Even the Communists in China know how to create more wealth, by lowering the barriers of investment. Communist China has a small 10% Capital Gains Tax on asset earnings. With that kind of incentive for people and business to create wealth, it is no wonder why they are an 'up and comer' in the world market.

Obama plans to increase the capital gains tax rate to from 15-28% (87% increase) for incomes over $250,000, and revert back to the Clinton era 20% rate (33% increase) for everyone under $250,000. In either case, a capital gains or dividends tax is targeting the wealthiest individuals. This group, the top 10%, own 97% of the nations wealth (stocks, bonds, mutual fund, liquid cash, property, and other assets). I also submit to you that these people are wealthy not because they took it from someone or something. They CREATED their wealth. Some argue that the wealthy deserve their rewards because of the risk that they have incurred for their ventures. This is true! But, not only do they deserve it for taking big risks, they also deserve big rewards for making others wealthy. As capitalists seek out new ways to add to their own wealth, they help others create wealth in the process.

Let us take Bill Gates as an example. It is a known fact that he has made other people more money than he has made for himself. After all, Microsoft would not be what it is today if it were not for personnel and capital. I would say his reward for helping others in this regard is completely justified. Let's face it, entrepreneurs know how to create wealth. They do it by redeploying their earnings into their businesses, or their investment portfolio in order to make more. Not by taking it from someone else.

Let us assume (for just a small moment in time) that that the Libs are right, and all capitalists are "greedy." Well, in that case, "greed is good" (famous words of Gordon Gecko). If we are in fact greedy, and only yearn to make more, we are going to do it with the only two tools available (capital and personnel). Without capital and personnel, additional wealth cannot be created. If you penalize me more for making more, what would the incentive be to use addition personnel and capital (at an added cost from taxes) to create more wealth? Raising capital gains is not congruent with growing an economy. It would only further stifle the economy, by decreasing capital investment and decreasing the need for additional personnel (unemployment). The notion that "spreading the wealth around" will grow an economy from the bottom up is completely preposterous.




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