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View Diary: President Obama delivers remarks on extending middle-income tax cuts (151 comments)

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  •  Taxes actually (0+ / 0-)

    promote job growth, since payroll is pre-tax money.

    Think of it this way: suppose a small businessman makes 2 million a year. Right now that second million is taxed at 35%...so to invest that million in the business costs the guy $650,000 worth of money that he would otherwise just put in his own pocket.

    Now, if taxes on that second million were at 75%, the cost to the guy of investing that second million would only be $250,000 out of pocket.

    In other words, since investment is pre-tax, the higher marginal rates promote investment.

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