When Hillary Clinton last night vowed not to ever raise taxes on the “middle class,” which she defines as anyone making under $250,000 per year, how do you suppose CEO’s in the health insurance industry reacted?
I’m guessing they poured themselves glasses of fine champagne. And perhaps traded in their private jets for larger models.
The indirect consequences of Hillary’s “read my lips, no new taxes” pledge are too numerous to identify. Some may even benefit the actual middle class, as opposed to the folks making $225,000 per year and living in a McMansion whom Hillary labels middle class. On balance, however, her pledge was a cynical ploy to let those at the top know she’s not coming after them, while pretending to be a candidate of the people.
Consider just a few of those indirect consequences:
If we’re not going to increase middle class taxes at all, how likely is the passage of an increase in taxes only at the top?
If we’re unwilling to consider which services, such as health insurance, are more efficiently provided by government than the private sector, have we not given the private providers of those services license to overcharge?
If we’re not willing to collect taxes to properly fund our regulatory agencies, who benefits more, the middle class worker who avoids a $53 per year tax increase, or the polluter who goes unpunished?
If we’re unwilling to consider an increase in tax to the bottom 97% or so, does that increase or decrease the pressure to slash safety net services?
If the federal government achieves the no tax increase commitment by offloading costs to the states, who’s going to bear the burden at the state level?
If we’re less willing to increase taxes across the board, are we more likely or less likely to lower the interest rates charged on student loans? More generally, are we more or less likely to increase revenue from sources other than taxes, which fall disproportionately on the middle class? For example, how will this policy impact the admission fees for our national parks?
If we increase the minimum wage, workers will pay more in taxes because they’re earning more, but employers will pay less because their costs increase. On balance, however, the tax reduction for employers will exceed the tax increase to workers, so total receipts will fall. How will we offset this? If we can’t do it through a modest increase to workers’ tax rates, does it not put downward pressure on the increase in the minimum wage that ultimately can be enacted? Put differently, if our pledge not to increase the tax rates on the wage increases of minimum wage workers causes us to reduce the size of the wage increase, does Hillary’s “read my lips, no new taxes” pledge help the workers or hurt them?
Considering the friendly message Hillary is sending to those at the top while on the public stage pretending to be a champion of the people, one can only imagine the message she’s sending them in private rooms when appearing to be the people’s champion is not required.