The Info Village Business Blog

What is worse, higher taxes, or loss of value in stock investments and home value?

People's IRA, 401(k), and stock investments are down over 20 percent, and home values are down about same amount, if you can even find a buyer today.
Why would capitalists and those who own the million dollar properties or small businesses, fear maybe 5-10% higher taxes (paid only on profits, or income)?
Isn't a few points more in taxes worth it to decrease the national debt, raise the value of the American dollar, increase spending by the middle class, and again raise the values of stocks you own, and the other properties you own??

You are correct, that the government often uses taxation to provide important goods and services, and investment in the infrastructure, that makes our country the best in the world.

Without government spending, it would be as bad, perhaps worse, than having banks and lenders dry up. Without government investments in community programs and support of the underclass, we'd likely have more crime, and home-grown terrorists, like third world countries.

Letting the wealthy keep more money sounds great, but it comes to a point where more money only encourages more extravegances, much like Sarah Palin's spending $150,000 on a new wardrobe, or some people owning a fleet of Hummers, when many cannot even make payments on their Ford.

If the rich took much of their "surplus" money and voluntarily invested it into schools, roads, national defense, helping people pay off their mortgage, feeding the hungry, and providing hospital care for those without health insurance, I'd support them keeping their money.

Even Adam Smith who wrote "Wealth of Nations", said that capitalist often lived/worked for their own self-interest, and government had to provide incentives for serving the greater community.

The "larger community" is where the wealthy have to live, hire, and trust to not rob or kill them.

Fairness and public safety often requires some redistribution of wealth. (because we really want the middle class to suceed and have extra spending money too, and not move to the unemployed, or bankrupted categories)

Common sense says that the poor need to be incouraged to better themselves with public education. The wealthy have a self-interest in keeping the population healthy, this is also cost-effective. When people use charity hospitals, those costs are just passed up the chain, debt is redistributed too.

You are right that low taxation fails, when it only causes deterioration of the larger community, (when there is a growng separation between rich and poor)) and worsening of USA credit, because even Uncle Sam cannot pay his bills.

A return to taxation rates of the Clinton years would not harm America, IMO, but would make America work the way it used to, and even cause the wealthy to spend their money a little more efficiently, because they have less of it.

Otherwise, like if McCain becomes president, and he FREEZES government spending, who will pay then for needed social services?

NO ONE.
And eventually suffering can trickle up to those who think they are safe and protected.
They are getting a taste of it now, even before the election, with the results of the lower taxation policy of G. W. Bush.

Edit: To Politically Correct. I am an historian, and both you and McCain has distorted history, by blaming HIGHER taxes as a cause of the Great Depression. I will quote a portion of the source I provide below.

Profits rose 62% in the 1920's wages did not.
The main causes were raise in productivity, and federal taxation being LOWERED, thus allowing more business investments to increase supply, while demand decreased due to unemployment.

Read and learn, please, and stop the abuse of history:

>>A major reason for this large and growing gap between the rich and the working-class people was the increased manufacturing output throughout this period. From 1923-1929 the average output per worker increased 32% in manufacturing8. During that same period of time average wages for manufacturing jobs increased only 8%9. Thus wages increased at a rate one fourth as fast as productivity increased.

As production costs fell quickly, wages rose slowly, and prices remained constant, the bulk benefit of the increased productivity went into corporate profits. In fact, from 1923-1929 corporate profits rose 62% and dividends rose 65%10.

The federal government also contributed to the growing gap between the rich and middle-class. Calvin Coolidge's administration (and the conservative-controlled government) favored business, and as a result the wealthy who invested in these businesses.

An example of legislation to this purpose is the Revenue Act of 1926, signed by President Coolidge on February 26, 1926, which reduced federal income and inheritance taxes dramatically11.

Andrew Mellon, Coolidge's Secretary of the Treasury, was the main force behind these and other tax cuts throughout the 1920's. In effect, he was able to lower federal taxes such that a man with a million-dollar annual income had his federal taxes reduced from $600,000 to $200,00012. Even the Supreme Court played a role in expanding the gap between the socioeconomic classes.

In the 1923 case Adkins v. Children's Hospital, the Supreme Court ruled minimum-wage legislation unconstitutional13.<<

The working middle class in the 1920's didn't get their wages increased, and today it's the same middle class that has seen it's buying power reduced again.

	Networking for Home and Small Businesses, CCNA Discovery Learning Guide List Price: $80.00 Sale Price: $57.73 Used From: $51.00 Average Rating:
	Networking for Home and Small Businesses CCNA Discovery Learning Guide   Allan Reid • Jim Lorenz   Networking for Home and Small Businesses, CCNA Discovery Learning Guide is the official supplemental textbook for the Networking for Home and Small Businesses course in the Cisco® Networking Academy® CCNA® Discovery curriculum version 4...

	Digital Electronic Safe for Home or Business - 1.0 Cubic Foot Interior Space - Gray List Price: $99.99 Sale Price: $64.99 Average Rating:
	Easily store and keep valuables safe at home or office with this digital safe; works with included key or your own customized digital code you program. For added security, we've made the hinges concealed so they're tamper-proof...

	Start & Run a Home-Based Food Business List Price: $21.95 Sale Price: $14.15 Used From: $14.14 Average Rating:
	Are you one of the many people who dream of making a profit selling your own homemade foods? Now, with this one-of-a-kind, easy-to-follow guide, you can realize your home-based food business dreams! With over 25 years' experience, author Mimi Shotland Fix takes you step-by-step through the process of starting and running a food business...

	Panasonic Integrated Business Phone (KX-TS105B) List Price: $34.99 Sale Price: Too low to display Used From: $23.99 Average Rating:
	Providing a reliable connection even during power outages, the Panasonic KX-TS105B is a wall-mountable corded phone with a variety of convenient features. A one-touch dialer offers 20 separate stations for frequently-dialed numbers, while a separate speed dials provides 10 stations for the most important folks...

	Best Home Businesses for People 50+ List Price: $16.95 Sale Price: $6.78 Used From: $4.69 Average Rating:
	For the fastest-growing segment of our population, here is a comprehensive guide to starting and running a home-based business in midlife and retirement. A baby boomer turns fifty every seven seconds, creating what will soon be the largest and most influential senior generation in history...

	Quicken Home & Business 2010 List Price: $99.95 Sale Price: $54.95 Used From: $39.99 Average Rating:
	Quicken Home & Business 2010 gives you the personal finance features found in Quicken Premier plus tools that make it easy to see how your home business is doing. Manages both your personal and business finances together in one place...

	Home Business Magazine List Price: $23.94 Sale Price: $14.97 Average Rating:
	HOME BUSINESS MAGAZINE is edited to cover various facets of the growing and dynamic 425 billion dollar home-based business market. It contains editorial by well known authorities on business operations, sales & marketing, the home office, franchising, business opportunities, network marketing, mail order and other subjects to help readers select and competently manage a home-based business...

	How to Start a Home-Based Catering Business, 6th: *Become the top caterer in your area *Organize menus for parties, corporate events, and weddings *Market ... caterer (Home-Based Business Series) List Price: $18.95 Sale Price: $10.95 Used From: $14.33 Average Rating:
	Those passionate about parties or cooking can now realize their dream of working from home at something they enjoy. Denise Vivaldo shares her experiences and advice on all the essentials and more, including estimating start-up costs and pricing services, finding clients, outfitting one’s kitchen, and honing food presentation skills.

	The Best Home Businesses for People 50+ List Price: $6.95 Average Rating:
	The Best Home Businesses for People 50+ is a comprehensive guide to seventy home-based businesses ideally suited to the needs and desires for an active midlife and retirement. Today, be it from remaining young and energetic, wanting to pursue long-delayed dreams, or facing financial necessity, more people 50+are continuing their careers past the age when their parents retired...

How To Start and Operate Your Own Home-Based Business List Price: $39.99 Sale Price: $26.74 Used From: $23.90 Average Rating:

Learn how to start and operate a home-based business...you will learn: Entrepreneurship, Selecting the right business, Naming your business and obtaining the legal permits and licenses, tax deductions and how to pay your taxes, how to write a Business Plan and a Marketing Plan, Networking effectively, setting up your home-office, creating a professional image and balancing your home life with your professional life under 1 roof.