Conservatives love to claim that lowering taxes give the wealthy an incentive to create jobs and invest their money. There is little evidence supporting this position. Tax rates are now the lowest in sixty years, and yet the wealthy are doing nothing to create jobs. If anything, the incentives appear to be for the wealthy to shift jobs overseas at an ever-increasing rate. If they can find a country to which they can send jobs, they will, regardless of what the tax rates are in the United States.
The conclusion must be that lowering tax rates on the wealthy does nothing to create jobs. What it does is to create incentives to move money offshore, to tax havens where they can obtain the lowest rates available whenever they are able. They would far rather lobby for loopholes that allow them to pay lower rates than hard working families right here in the United States. The middle class and the poor don’t have lobbyists in Washington that will get their rates to fair levels in comparison to the idle rich.
It struck me that all the incentives given by tax breaks or subsidies accrue to the wealthy, or large multinational corporations. There are precious few incentives that are garnered by small business, which to my mind are businesses with under a hundred employees, or even less, and even fewer go to the middle class and the very poorest.
While Big Agriculture like ConAgra gain billions from subsidies and tax incentives from Washington, the poor get nothing. The Middle Class get a few incentives, but very few members of the Middle Class are in a position to take advantage of those tax breaks. Things like the mortgage interest deduction can only be taken if total itemized deductions exceed the standard deduction and individual deductions combined. For those people that have mortgage interest, finance their own medical insurance, have a small business from which they can deduct such things as office expenses or vehicle lease, the deductions may be of some value. For most people it is not.
Romney may well do away with such things as the mortgage interest deduction, earned income tax credit, child credit, among others, raising taxes on the most vulnerable in our society.
The question that begs to be asked is, what incentive is there for the Middle Class to succeed in life if their taxes are raised whenever we need to balance the budget or give tax cuts to millionaires and billionaires? Doing away with the deductions that the Middle Class currently take would increase the hardship on families that are already hard pressed to provide an education for thei children, send them to college, and provide even basic medical care for them. In return, we hand hundreds of thousands in tax cuts to the very wealthy.
What incentive is there for the very poor to work at all? They are not getting anything out of their employers, the government or anyone else for providing their labor to the workforce. What corporations want is for people to work for less and less in order to feed themselves, never mind paying the rent. This is why conservatives want to do away with the minimum wage. They can then pay their workers whatever they choose regardless of what the worker needs.
Romney has said that people should just get an education, start a business, pull themselves up from nothing. Where does he imagine that the money is going to come from to finance these things. The poor are unlikely to get a loan from traditional banks, and Romney will want to remove government from the business of providing loans for education. People cannot turn to their parents for those loans, their parents are too poor.
The same goes for starting a business. It costs money to start a business, and people want some kind of collateral. If you don’t have collateral, perhaps in the form of a parent’s home, you will be unable to start a business. Without partners or some description, there is no way to start a business. Even a small business like a Subway will take up to $200k to start. Banks are not going to accept a person walking in off the street. They want collateral.
If you are unable to get loans for an (expensive) education, or to start a business, precisely where do you turn? You are not going to have an incentive to start these things without help from somewhere. Romney has removed any incentive to claw ones way out of the Middle Class, and once he is in power, any remaining incentives will be removed.
If I were a minimum wage worker, earning $7.25/hr, where is my incentive to work, never mind pulling myself out of poverty? Nothing I do will change the fact that I am earning minimum wage. Most minimum wage jobs in for instance the food industry do not receive increases in that wage. There is usually very little room for advancement in the “entertainment” industry.
Many low wage earners can barely afford to pay for their transport get get to work, as well as pay for an apartment. Many low wage workers cannot afford to pay for accommodation. Conservatives like Romney say that the 47% believe that they are entitled to housing, food, things like that. Conservatives want to force people to work at low wage jobs that prevent them from earning enough for housing, food, and clothing, while the wealthy get massive tax breaks.
There is no real incentive for the poor and those with low wages to work at all. That they do is a testament to their dogged determination. Romney calls them moochers, living off government welfare while pocketing the ill gotten gains from his 14% tax rate. There is no reason that those low wage workers could not have been paid more instead of paying for wealthy moochers like Romney to have larger tax cuts. These tax cuts are really stealing money from the pockets of the poor.
When you have nowhere to turn, you are often forced to avail yourself of whatever aid is available. You don’t do it because that is where you want to be in life. If people were given a fair shake, they would be more prepared to work harder and longer. As it is, many people work hard at multiple jobs, for low wages, and will never climb out of the lower classes.
They have no incentive to go to work every day, but they do it because they need to feed their children and themselves.
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