Economics 101 college

1. Taxing the Wealthy<br />Diving into the rich pool<br />By: Jeanette Shepherd<br />The article I have chosen to review was called “Taxing the Wealthy, diving into the rich pool”. I chose this article because I wanted to learn more about this current event. I also feel I am slightly bi-est being in the lower earners bracket and understanding the inability to not be able to get ahead. This article relates to two different topics discussed in class, economic forecasting and economic indicators. The article used indicators from past tax hikes and forecasting from past trends.<br /> I have reviewed different measures Barack is taking and where the money will be going. Some down falls that may take place when it happened, past economic trends as well as supporters of these measures. <br />There are many different reasons Barack Obama is choosing to change the tax laws. Obama has stimulus measures in place. There is $787 Bil stimulus package that’s designed to start upwards of $2.3 Mil jobs, he has also set aside $224 Bil to extend healthcare, unemployment benefits and education. Barrack has changed pay role tax. It was dropped 2% in hopes that would be an incentive for more hires. Tax credits have been drawn up for employers that hire on war veterans and the long term unemployed. Resurfacing the roads, updating schools and bank infrastructure will get $105 Bill. What I find the most interesting was that Barack Obama wants to help with middle class people’s high mortgages to refinance them. <br />From some points of view the re-structure plan sounds great. Taxing high income earners, those who earn $400,000 or more, are highly mobile and are the biggest investors in the economy therefore they could choose to leave the US and go else where they were they wont be taxed as high. High earners would stop investing in the American economy this will weaken an already weak economy. Since the States is already the highest contributor to the OECD with 22.21%. I am sure none of the people falling into this new tax bracket will mind relocating.<br />Over the past 30 years government have been taking less and less from the high earners. In the 1980s corporate taxes was at 40% and in 2007 it was at 28%. So in light of that fact I don’t see how raising corporate tax slightly to balance other areas would hurt? High earners have doubled in economic growth between 1976-2007 some by 58%. So why isn’t it their time to give back as well, instead of rebuilding a country on the backs of individuals living off food stamps?<br />This reform had been coined the “Buffet Rule” named after one of its billionaire supporters William Buffet. He has been publicly scorned for voicing his negative opinions that he “enjoys an effective tax rate that is less than his secretary’s.” A number of other supporters include Luca Montezemoto the chairmen of Ferraris. Montezemoto is quoted saying it is “right” for the wealthy to pay more. There are also a number of countries following suit. Germany, Italy and France have all signed petitions in favour of this in their countries. Italy is raising the taxes on the earners that earn €300,000 and France over €500,000.<br />My opinion is that the whole world is in financial crisis. Yes, these are drastic measures but something drastic has to happen for it not to continue into a depression. I agree with Barack Obama in he decisions he is making for his country, the people put him in power for a reason. That reason is that they blue collared worker wanted a change.<br />