Robin Hood was an Idiot...

...and so are our congressional representatives.

Half of them say that we should get the rich to "pay their fair share".  The other half say that this will cost jobs and that the rich guys can't pay off the national debt, even if you take ALL their money.  Does any of  this sound familiar?  The economists call it 'redisribution of wealth'.

Robin Hood called it robbing from the rich to give to the poor.  Let's get real.  It doesn't work.  Never has, never will.

Why?  Because rich guys make the rules.  They're not going to do anything that really matters in the long run, because it would hurt THEM.  How many of those 535 n'er-do-wells down in DC are millionaires?  I'm guessing better than 90% of 'em.  Do you think they're going to volunteer to clean up the budget mess with their own dollars?

Yeah.  I got a bridge I'd like to sell you...

Here's the skinny.

Argument: The rich pay too little in taxes.

• Fact - about 1/2 of the people in the US don't pay any federal income tax because they don't make enough money.  Who pays the bulk of the taxes collected?  Rich guys.
• Fact - the earned income tax rates go up as you make more money.  Rich guys ALREADY pay more (a lot more) taxes, as a percentage of their income, than poor folks do.
• Fact - most of the money rich guys make comes from businesses and investments.  Raising their income tax rate doesn't get you DIDDLY in additional revenues.  You'll have to change the tax rules for business and passive investments, too.  And who writes those rules?  Rich white guys, in Congress, on both sides of the isle.  Think that'll happen?  Nah. Me neither.

If you're a small business, you're stupid if you're not incorporated - for various reasons.  But, let's say that you're a small businessman who still runs the whole thing out of your back pocket.  And you made a million dollars last year (good business, huh?).  Realize that EVERY business expense gets subtracted from that million dollars, and what's left is your net adjusted income.  And THAT is what you pay taxes on.  It's the money you get to keep - your profit.  Out of that million dollars, you probably expensed about $900,000.  That leaves a net adjusted income of $100,000.  And THAT is what you'll pay taxes on.  So, this ballyhooed tax bump on $250k and up individuals just passes you by.  It doesn't hurt you in the least.

Now, if you're mister megamillionaire, you put your money into long-term investments.  And they produce income.  Under the current law, that income is called a LONG-TERM CAPITAL GAIN.  And, it's only taxed at 15%.  Wanna know how a certain presidential candidate only paid 14% in taxes last year?  Easy - he started at 15% from all his long-term capital gains (from his investments) and then he gave a bunch away to charities, lowering the taxable income even further.

Therefore, the only way to soak the rich for more tax money is to either increase corporate tax rates (and we're already the highest in the world) or to raise the long-term capital gain tax rates.  And that ain't gonna happen for two reasons.  First, it would hit Congress in their own wallets.  Second, it would make a bunch of rich guys yank their money out of the US economy and send it someplace more "friendly".  Like Monaco.

Well, kiddies, just how are we supposed to deal with this danged $20 Billion deficit?

1. Spend less
2. Tax more

We're kinda screwed on #1, because three-fourths of our government money goes into entitlements.  And if you cut those entitlements, you lose votes.  That's what Congress calls the "third rail" (a reference to the high-voltage rail that makes subways run, and kills anything that touches it).  So, Congress will piss and moan about incremental changes to the remaining fourth of the budget, which doesn't buy us squat in the long run.

If we can't soak the rich guys or corporations for #2, where will the money come from?  You and me, baby.  You can grab your wallet, lock it in a safe, bury the safe, and burn your house down on top of it.  Congress will still find a way to make sure that WE pay the deficit that THEY created.

That means the ONLY - and I do mean ONLY - way to increase tax revenues is to get more people making more money.  Since only the top half of income earners even pay any tax - THOSE are the jobs we need to create.  THOSE are the guys that will have to pay off the deficit.

In other words, Congress needs to quit pissing on each other and figure out how to create good paying jobs.

That's our only salvation.

We're doomed, aren't we?