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My Daily Domestic Clips 10/12/2010 (a.m.)

  • tags: currentevents Obama economy areyousorryyet?

    • Mankiw says more taxes would
      just mean he'd work less.

      In an example he gave he
      showed why:

      If he was offered $1,000 to
      write an article - without taxes at all - he would get a $1,000. And if he
      invested it at 8% interest he would end up with $10,000 in 30 years.

      But then again, that world
      doesn't exist.

      In reality, if the tax cuts
      expire, he would pay more than 39% in taxes, nearly 4% in Medicare tax thanks to
      Obamacare and more than 5% in state income taxes which equals $523.

      As far as investing it, the
      corporation whose stock he chose would have to pay 35% tax, so he would only
      make a little more than 5%. So over 10 years that money would only grow to about

      But wait there's more!

    • Once he leaves his children that money in his will, they'll get hit by a 55%
      estate tax. So instead of $10,000, his kids would get less than $1,000. So why
      bother in the first place!
    • And he's not alone - a study by the an economist at
      Arizona State University  found a 10% increase in taxes led to a 10 to 15%
      decrease in work hours.--especially if those workers felt their money was going to transfer programs like Social
      or welfare.

      As Mankiw points out, some
      of these people being less incentivized to work may include surgeons or lawyers
      or people vital to your day to day life.

      So just because you don't
      make $250,000 you too will find your life altered-- and not in a good way-- if
      it's just the "so-called" rich bear the burden!

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