Letter: Taxing the rich doesn’t help the poor

Monday, September 11, 2017
Taxing the rich doesn’t help the poor

Say the federal government taxes a rich guy $10,000 and hands out $1,000 to each of 10 poor people. That will help reduce the gap between rich and poor, right?

Wrong, not in the long run.

Here’s why: Poor folks need all of their income to support themselves. Rich folks spend only part of their income and invest the rest. Those investments generate jobs, which are ongoing. Over the long pull, the jobs raise the income of the 10 poor folks more than the one-time $1,000 they would otherwise have received.

But with our gigantic federal government, only a small portion of new revenues actually reach the poor. Some goes to prosperous crony capitalists. Some pays the salaries of federal bureaucrats whose average income, including benefits, is way higher than that of average Americans.

Legislators should attend to the people’s long-term interests, not the short term. Low tax rates for everyone, including the rich, eventually make everybody better off.