Tuesday, February 06, 2007

The Real Two Americas

Investors Business Daily ran a good editorial recently called, “An Undertaxed America?”

Of course, we already know John “Two Americas” Edwards and the other Democratic candidates want to raise taxes on the “rich.”

In fact, Sen. Chuck Schumer’s new book criticizes Ronald Reagan and Republicans for supporting economic royalism. Nancy Pelosi and Charlie Rangel also want to raise taxes on “rich” people, and all of this revolves around left-wing economic populism circa Sen. James Webb, Lou Dobbs and some others.

Yes, there are two Americas, but not the two that these tax-happy liberals keep talking about. The real two Americas are a taxpaying America and a non-tax paying America, according to Tax Foundation president Scott Hodge.

Congress’ Joint Economic Committee reports that the richer half of the American population pays almost 97 percent of income taxes. Those in the top 5 percent pay 54 percent. And those ranked in the top 1 percent pay over a third of all personal income taxes.

(Alan Reynolds proposes abolishing the low-end ten percent marginal tax rate, since no one really pays it anyway.)

Speaking of global tax competitiveness, Germany intends to reduce its corporate tax rate to 15 percent. French presidential candidate Nicolas Sarkozy aims to lower the French corporate tax rate to around 25 percent. (Looks like a European trend.) Meanwhile, back in the states, corporations are footing a hefty 35 percent federal tax bill and roughly 40 percent overall.

It’s worth noting that Hillary Clinton doesn’t want corporations to pay any taxes at all—not a single penny. Hillary plans on confiscating their profits altogether! (In our CNBC interview Friday night, P.J. O’Rourke referred to Mrs. Clinton as “Hugo Chavez in a pantsuit.”)

That’s all folks!