May 06 2011
President Obama claims there are many reasons to raise taxes on the rich – “It’s only fair…. They can afford it…. They get the most, so they should give the most.”1 But, ultimately, President Obama’s case for taxing the rich rests on the axiom attributed to the notorious bank robber Willie Sutton. Just like robbing banks, that’s where the money is. By taxing the rich, President Obama hopes to avoid politically difficult reductions in other government programs. But raising taxes on the richest Americans will generate only a fraction of the expected revenue. Rather than a political panacea for our nation’s deficit woes, taxing the rich is largely a self-defeating proposition.