Obama: Cut the deficit by taxing the rich

[Mr Khan]

Kasz216 said:

Also, taxing the rich more is a BIG risk.

Because well... when times are bad, the amount of money the rich pay in taxes shrink heavily... because the rich are hurt the most by economic crashes.

So, the times when you need money the most... you will have the least amount of money availible... and when you need the least amount of money, you have the most.

Isn't this how we got there?

The idea long term is that government saves during booms and spends during busts, the problem being that democratic government is very unreliable for any sort of long term plan. The end result being that booms are lesser (being that investment money is taken from the most likely investors), and then in bust time you have more moneys for necessary unemployment benefits to take out and can soften the blow, or invest in keynesian-style ditch-filling or other frills to keep people working and restart the whole thing

Optimally the tax rate would reflect the state of the economy. If the tax rate matched economic growth or decline it would be able to retard both and kick recessions out quicker (because as the economy lapses, tax rates would go down to reflect that, freeing up money being made at the top, so that you could have both supply-side and keynesian solutions working in tandem to pick things up)

The only burden being that growth in boom times would be less than it could have been, but it's only prudent to squirrel extra away in times of abundance, or at least moreso than not squirrel extra away, then expect everyone to belt-tighten when there's just less going around for everyone

The problem being, as i previously stated, that democratic politics is simply incompatible with fiscal responsibility. When people are making lots of money, they don't want the government getting more of that, and when people are making less money, they don't want the government getting more of that, but simultaneously don't want the government cutting into benefits, benefits that they may have lost back when everyone was making money and they thought "why are we paying for this again?"

Short-sightedness that i would not blame on any political ideology, just that short-sightedness like that is human nature, and human nature tied to self-government then yields these flaws