Nathan Scandella (personal)

Taxes, Taxes, Taxes

Any time a Democrat follows a Republican in the White House, you are bound to have a round (or several) of tax raising. Republicans spend 4 or 8 years lowering taxes to unsustainable rates, and Democrats have to make the unpopular decision to raise them again. They generally mitigate some of the political fallout by increasing spending on some programs that people want, both giving their constituents a feeling that they're getting something for their money, and also undermining the effect of the tax increases on the federal deficit.

Today, I read an article from the head of Sybase, putting forth the usual mindless economic argument about why corporations can't survive with any more tax hikes:
http://brainstormtech.blogs.fortune.cnn.com/2009/07/16/international-tax-hike-taxes-business/

Here was the response I posted:

This post is ridiculous. First of all, there's citing a study (Index of Economic Freedom) and completely misrepresenting the findings. The US is 6th (1st being the best) on the list. 6th!

Second of all, yes, Obama is going to be raising tax rates on "taxable" corporate income. That has to happen, because corporations keep exploiting more loopholes to keep the total amount of tax they pay down. The amount of tax paid by corporations in the US is small, NOT large, as Chen would have his readers believe.

http://www.taxpolicycenter.org/taxfacts/displayafact.cfm?Docid=263

Even on a US scale, our corporate tax contribution now is historically lower than average.

Finally, anyone with a brain larger than a pea (apparently not Chen) can understand that in a country with low personal tax rates (yes, bozos, we do have low personal tax rates here!), you have to get corporations to contribute. European countries may have lower marginal corporate tax rates, but they have much higher personal tax rates. If you put the two together, the USA still stacks up favorably as being a low tax state, relative to GDP:

http://en.wikipedia.org/wiki/List_of_countries_by_tax_revenue_as_percentage_of_GDP

This is just libertarian nonsense. If this clown is running Sybase, I'll make sure to short some of their stock at my earliest opportunity.

Posted at 12:22PM Jul 16, 2009 by Nathan in Economics  |  Comments[0]