October 27, 2008

Why Obamanomics will destroy our economy

Monica posted an interesting item about H. Wayne Huizenga, the long-time owner of the Miami Dolphins. He's weighing the sale of his 50% stake in the team to Stephen Ross (who previously purchased the other half).

Huizenga is worried about the capital gains tax increases that Barack Obama is proposing. Let's pretend we're not multi-billionaires like Huizenga but instead we're normal professionals making $100,000. Let's say you take 10% of your after-tax income (well say it's $8,500) and invest it in stocks because you want to be part of the investor class. And let's say that the value of the shares grows doubles in five years to $17,000 then the $8,500 profit you make when you sell it is subject to a tax. Currently that rate is 15%. Now Obama wants to take that rate up to 28%. Do you have any incentive to sell those shares? Do you have any incentive to invest more into the markets or will you be looking for other investments?

The fact is that Clinton and Bush both cut capital gains taxes and both times the government came out winning on the other end because more investment created more growth and thus more tax revenues. But Barack Obama, when confronted with these facts, talks about "fairness". Because in his mind it's more important that the rich man doesn't make money than it is for the government to benefit from the rich man's success. Don't believe me? Listen for yourself.

Posted by Henry Louis Gomez at October 27, 2008 04:00 PM

Comments

likewise, with cap gains high, there will be no incentive to invest in the market, hence why the prediction of a bear market lasting more than a decade from now. See folks, if the market stays low, then your investments don't grow and less money when you retire.

I guess they want us to simply rely on social security

Posted by: Cigar Mike Pancier [TypeKey Profile Page] at October 27, 2008 05:00 PM

The economy is already destroyed.

Posted by: keyrat [TypeKey Profile Page] at October 27, 2008 07:10 PM

We've got major problems no doubt thanks to social engineering "minorities need to get mortgages regardless of credit or ability to pay" and runaway spending. But more of the same liberal policies as personified by Barack Hussein Obama is not the prescription to fix it.

Posted by: Henry Louis Gomez [TypeKey Profile Page] at October 27, 2008 07:17 PM

The Mulatto Lotto: Take the money and run. (Ghettopoly)

Posted by: mulatica [TypeKey Profile Page] at October 27, 2008 08:53 PM

That's right Keyrat: Democratic entitlement policies, coupled with out-of-control Fannie and Freddie looting, hidden and protected by the Dems for over a decade, coupled with Republican spinelessness (with some exceptions) to muster the will to throw the leftist bums into the trash bin of history where they belong. That's why we are where we are.

Posted by: George L. Moneo [TypeKey Profile Page] at October 27, 2008 09:24 PM


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