Liberals hate the rich and want them to pay their “fair share.” Liberals are sick and tired of those evil, rich fat cats taking advantage of the poor—actually they believe the rich have stolen every penny from poor people. Taxing the rich is a way of getting even. The more the government taxes the rich, the happier liberals are…or are they really?
The only problem with this scenario is that it is totally false—totally devoid of reality.
Here is the reality. You cannot “tax the rich” or make them pay their “fair share.” The rich have two options. First, they can simply add the tax to the cost of their product, which all businesses do. Or, secondly, they can move their headquarters to the Cayman Islands or other overseas tax havens and pay no income taxes, which is what GE and a whole host of companies have done. You cannot tax the rich!
VOTE D if...you want to DEVASTATE the RICH!
The liberal elite understand that, but only use it as a political weapon. The sooner that the average American understands that fact; the sooner America will be free from demagogues.
Maybe a simple true life illustration will demonstrate the absurdity of taxing the rich. Only I have changed the names to protect the guilty government gangsters.
Imagine that Mr. U wants to go to the restaurant to eat his favorite hamburger. He is a typical liberal totally oblivious to the real cost of doing business. But here is the truth.
The farmer grows the wheat and sells it to the elevator company for 1 cent a unit. (I am using numbers that are easier to follow.)
The elevator’s basic cost of storing and cleaning the grain is 4 cents, but the cost of government regulations, red tape, license fees, etc. (hereafter known as CRUD) adds 4 cents to their cost of doing business (hereafter known as CODB). Now, it will add in 1 cent for profit. After all, does the liberal work for nothing? Does the liberal work to just cover their basic expenses of food and clothes? The reality is that most businesses have a very small profit margin of 1, 2, 3, or 4%. Wal-Mart has a profit margin of 4.19%.[i] (My illustration gives every business a filthy rich profit margin of 10%).
So, now the total cost or CODB to the elevator is 10 cents. Now, the President has said we must tax those evil, rich fat cat elevator companies because they make over a million dollars a year. So, he adds a 1 cent tax. Now, this company does what all companies do; they add it to their CODB. So, a unit of wheat now costs 11 cents.
Next, the flour company needs to buy the wheat. So, first they buy it at 11 cents a unit, and then they hire a trucking company to get the wheat from the elevator to their mill.
The trucking company has its CODB—employees, breakdowns, etc. Their basic cost is 5 cents, but the government CRUD adds another 4 cents, and they add their 1 cent profit. But, the President has said we must tax those evil rich fat cat trucking companies, so they add a 1 cent tax.
So, the flour mill buys the wheat for 11 cents and pays 11 cents for trucking for a total cost of 22 cents for that unit if wheat.
That flour mill’s basic CODB is 5 cents—for employees, machinery, buildings etc. Now, they add the government CRUD, which adds another 4 cents, and they add their 1 cent profit—for a total cost of 10 cents. Now, the President has said we must tax those evil, rich fat cat flour companies and adds a 1 cent tax.
So, the flour company now sells the flour to a bakery for 33 cents a unit. The bakery must hire a trucking company—we already know their CRUD costs—so the basic cost to the bakery is now 44 cents for the flour.
Like all companies, the bakery has its CODB. To turn flour into hamburger buns, it costs them 5 cents. The government CRUD adds another 4 cents, and they add 1 cent for their profit. Now, the President has said we must tax those evil, rich fat cat bakeries, and he adds a 1 cent tax. Now, the cost of that hamburger bun is 55 cents.
Mr. U’s favorite restaurant now orders hamburger buns for 55 cents. But they have to pay a trucking company to ship the hamburger buns to the restaurant. (Just how much CRUD can one company haul?) Now, that hamburger bun costs 66 cents.
Mr. U’s favorite restaurant has a CODB of 5 cents—employees, buildings, etc. The government CRUD adds another 4 cents to his bottom line, and he adds 1 cent for his profit. But, the President has said we must tax those evil, rich fat cat restaurant owners, and he adds a 1 cent tax. Now, the cost of that hamburger bun is 77 cents.
Mr. U walks into his favorite restaurant and orders a hamburger. Oh, I forgot to tell you about the hamburger meat. It has gone through that same process from the rancher all the way to the restaurant owner, and it costs 77 cents a unit.
The hamburger is made and Mr. U eats it with delight. However, when he gets the bill, his eyes bulge and his stomach feels sick. He can’t believe his eyes. A total bill of $1.54 is staring him in the face. He calls the manager over and says I think a mistake has been made with my bill. He explains that just last week the hamburger cost only $1.40. The manager tries to stutter an explanation and he offers a weak apology. But, how do you explain—in simple terms—what has just happened?
Now, if Mr. U is a liberal, he pays the bill cursing and swearing and saying he will never buy another hamburger here because they are only robbing him. He sees no reason for the cost of a hamburger jumping 14 cents in just one week. Why, at that rate, it won’t be long until a good hamburger will cost you 5 bucks. He throws his money on the counter and stomps out. (He consoles his soul by generously leaving a 1 cent tip to that poor waitress.)
If Mr. U is a conservative, he simply smiles, pays the bill, and says, “I know—I know! The President promised to tax the rich and I AM THE RICH because I HAVE A JOB!” IF U HAVE A JOB, UR RICH!
If you are a liberal, you still don’t get it.
Liberals never understand that it is the filthy rich government gangsters who are really getting rich and paying no taxes. Add up all the CRUD and taxes in this illustration and the hamburger should have cost only 84 cents. Government CRUD has driven up the cost by over 45%.
If you are a conservative…well, I don’t even need to explain…you know it. You know who really pays the bill every time the President says “tax the rich” and “make them pay their fair share.”
VOTE D IF….YOU WANT TO DEVASTATE THE RICH!
Do U have a job? Do U have a dollar to spend? U R RICH!
Facts to chew on: Sour Grapes for Liberals.
In 2009, the hidden cost of regulation was greater than all the pre-tax profits of all businesses combined and almost 12% of the nation’s GDP.[ii]
To comply with federal regulations, Americans spent $843 billion in 2000. Had
every household received a bill for an equal share, each would have owed $8,164.[iii] Remember, you did pay for that in the hidden cost of every item you bought.
Firms employing fewer than 20 employees face an annual regulatory burden of $6,975 per employee…[iv] You paid for that too—in less wages and higher prices.
Such regulation imposes about 40 percent of total business regulatory burden.[v]
That 40% is not far from my illustration. However, Remember that this report was made in 2000—just after Clinton and long before Obamanomics and healthcare overregulation took effect, which has added dramatically to the CODB.