Obama Opposite Speak and NY's 'Millionaires' Tax'

On cable news channels most days, to find the news that’s truly interesting, important, threatening, and worthy of discussion, you have to ignore the talking heads and look to the “craw”’ across the bottom of the screen below them.

The other day, for example, during my lunch break, I read the bottom of the screen news about: employees in France taking executives hostage (a harbinger of things to come for us?); U.S. reporters to be put on trial for espionage in North Korea (will Obama show the same paralysis as Jimmy Carter did about our hostages in Iran and let the entire world know that, during his administration, we are without testicular fortitude?); Obama props up GM yet again (taking sides against the winners not taking government money – Ford, Toyota, etc., and continuing the utter destruction of open competition and free enterprise).

All that crept across the bottom of the TV screen while the “journalists” on MSNBC discussed Madonna: will she or won’t she adopt again?

That same day in Obama’s home city, the Chicago Sun-Times filed for bankruptcy – the latest of many venerable newspapers to drown in the sea of red printer’s ink. At this pace, within his first term, all the legitimate news reporting organizations will be gone, and the only thing left passing as investigative reporting will be MSNBC’s “Catch a Predator-Episode #5,007.” Soon, the only sources of news will be those snippets crawling across the bottom of the screen. Everybody will be well-informed about celebrities’ weirdness and completely uninformed about everything else. Perhaps that’s somebody’s plan.

Here’s a news topic from these past couple of weeks that has been discussed much less than warranted: the new “millionaires’ tax” agreed to by New York’s governor and legislature, the largest income tax increase ever imposed in that state. The tax is a discriminatory punishment only on a tiny percentage of New York’s richest and most productive citizens (already paying a hugely disproportionate share of the state’s bills.)

On March 29, the New York Times blithely reported as if fact, that New York would levy this tax “in order to close the state’s yawning budget deficit”…and that “the plan would raise $4-billion a year.” Nowhere in the same lengthy article could you find the truth – that it’s probable that the tax will cost the state far more than the hoped for $4-billion it will confiscate. Nowhere was the fact mentioned that raising taxes in similar ways always fails to increase tax revenues over losses on the other side of the ledger. The fact (inconvenient to liberals and fools) has been repeatedly established over at least 40 years that tax revenues are most clearly, certainly and directly increased by cutting tax rates, not boosting them.

In this instance, the $4-billion windfall prediction supposes that those taxpayers targeted and attacked will take no action; will merely stand down and surrender. Well, for the record, people don’t become rich people by being stupid or being wussies. They didn’t succeed by letting themselves be robbed, bullied, beat up, and abused, or by thinking they have no opportunity to exercise control over their circumstances. They are rich not by accident or luck, not thanks to weakness and acquiescence.

Quite a few of the folks targeted for this new millionaires’ tax are going to find ways to shift income, defer income; some are going to leave the state altogether and give all their taxes to a different, less abusive government; some will reduce their efforts and voluntarily reduce their earned income and live off their investments. Those running companies will get the extra tax by cutting payrolls, delaying capital investments, and raising prices – so, ultimately, the millionaires’ tax is paid for them by non-millionaires. In fact, immediately, some high-profile, very rich New York residents announced plans to move elsewhere as state of primary residence. The extra tax bill would, arguably, not matter much or at all to them in strict monetary terms. But it matters to them in principle. They resent it, and they can respond. Punched in the nose, they punch back, or at least refuse to stand still for the next blow.

If the politicians actually think this will solve their deficit problems, they are idiots unable to tell fiction from fact. But maybe this is not about actually solving the state’s problems, anymore than Obama’s tax the rich schemes are about the incredible multiplying federal debt.

In the Times article, the executive director of the Working Families Party – whatever that is – said happily, “The era of phony prosperity has ended and a new era of shared sacrifice must begin.” But by shared sacrifice, he and his fellow travelers mean un-shared sacrifice; they mean piling more and more and more bills on the few, while exempting an even greater majority from paying any. Obama Opposite-Speak is popular with all liberals, socialists and communists. If this millionaires’ tax is someone’s twisted idea of populist economic justice, with full knowledge it does more harm than good, we should all shudder.

This is not just a New Yorkers’ problem. It is the first shot across the bow, certain to encourage other states to ready their cannons. If they get away with this in New York, it will certainly spread. That is real news – the kind that deserves to air above the crawl.

Dan Kennedy is a serial entrepreneur, adviser to business owners, sought-after speaker and author of 13 books. More information about Dan can be found at www.NoBSBooks.com, and a free collection of his business resources including newsletters and webinars at www.DanKennedy.com.