Statists view “the rich” as nothing more than ATM machines for funding big-government welfare states. They think they can take as much as they like – they’re rich, after all! – without consequences. Once they empty the machine, the bank comes out and fills it up again. But real people don’t work that way. They respond to uncertainty and threats to their assets by adopting a more cautious attitude. As this AP story highlights, targeting the rich has negative consequences not just for those who are being soaked, but for all of us.
Wealthy Americans aren’t spending so freely anymore. And the rest of us are feeling the squeeze.
…Economists say overall consumer spending has slowed mainly because the richest 5 percent of Americans—those earning at least $207,000—are buying less.
…[T]he most sweeping tax cuts in a generation are due to expire in January, and lawmakers are divided over whether the government can afford to make any of them permanent as the federal budget deficit continues to balloon. President Barack Obama wants to allow the top rates to increase next year for individuals making more than $200,000 and couples making more than $250,000. The wealthy may be keeping some money on the sidelines due to uncertainty over whether or not they will soon face higher taxes.
