A Conflicted President

An immutable law of economics: the more you tax something, the less you get of it. In 2008 candidate Obama argued for a higher tax rate on higher income earners even if the higher tax rate produced lower government revenues, all for "fairness". At least twice as president, President Obama stated that it would be inappropriate to raise taxes in a recession or a weak economic expansion. Now as candidate for re-election, candidate Obama is advocating for higher tax rates on higher income earners, not only on earned income but also on already once-taxed capital gains income. President Obama is seeking to raise the capital gains tax rate from 15 per cent to 23.8 per cent. Economist Allen Sinai has estimated that an increase in the capital gains tax rate to between 20 per cent and 28 per cent would decrease U.S. employment between 231,000 and 602,000 jobs a year. President Obama's own first chief economic adviser Larry Summers wrote in 1981 that elimination of capital gains taxes "would have very substantial economic effects" and "might raise steady-state output by as much as 18 per cent, and consumption by 16 per cent". QUESTION: Why would you propose higher taxes if you know it will lead to reduced economic activity and larger deficits - unless you were engaged in a little election year demagoguery? We know the only way out of these horrendous deficits is to expand economic activity while exercising a little sadly lacking fiscal restraint. This isn't rocket science. If a president who graduated from Eureka College could figure it out, presumably a graduate of Columbia University and Harvard Law School could - if he wished to. Cheers, all. See ya 'round the campus. Pete Laird Sr. Member Dover Republican Town Committee Views expressed are my own