Want a surefire way to help the poor? Don’t increase taxes on the rich.
This soak-the-rich tax scheme would wind up costing everyone something. In fact, in some ways the “non-rich” would be hurt worse than the wealthy.
The reason is simple: We live in an interconnected economy. The actions that affect one group wind up affecting all groups, for good or for ill. Who, for example, suffered more in the wake of the meltdown of 2008 — the “fat cats” whom so many love to pillory, or the small businesses that were shuttered after the moneyed investors and customers were unable to circulate as much money throughout the economy?
The same principle applies to tax policy. When we raise taxes on the rich, they react as any of us would: by doing what they can to shrink their taxable income. That means not investing as much in the kinds of projects that create jobs. This sets up a chain reaction: Lower-income workers wind up with fewer opportunities and smaller salaries — those fortunate enough to remain employed, that is.