Taxes and Incentives

There is an old saying that you can't reward "A" while hoping for "B". For example, I can't pay employees by the hour and hope they will maximize their time efficiency. Hourly employees are incentivized to take as much time as possible to do anything. If this is true, then it must also be true that you can't punish "A" while hoping for "A". And yet this is exactly what Obama and the liberals are proposing.

Liberals worry profusely about protecting American jobs. They abhor free trade (a topic for another day) because of the possibility that American jobs could be sent offshore. Recently Obama proposed a tax incentive for every new job created in the USA (as if it would be realistically worth creating a job that isn't needed).

And yet liberals hate the very corporations that provide the most potential for securing American jobs. Obama brags about raising the capital gains tax to levels we haven't seen since Jimmy Carter. He characterizes "Big Oil" as the source of all evil. His tax plan will literally destroy countless numbers of small businesses, and choke the life out of our economy.

Here is the thing. You can't preach American job growth out of one side of your mouth and spit upon American companies out the other side. Companies will do that which makes them profitable. If that means sending work offshore or relocating to lower-tax countries, they will do it. So if we want American jobs, incentivize them! It makes no sense to raise taxes on corporations or small businesses. We need to create an economy that they can flourish under and that means low taxes.

This can easily be applied to income taxes as well. We want people to be successful, right? So why punish it? How does that encourage employees to fight for that extra raise and entrepreneurs to take much needed risks? It is foolish to punish "A" while hoping for "A". Why don't we reward "A" instead?