Several days ago Warren Buffet did something nobody expected. He asked the super wealthy to make sacrifices with the rest of the country and pay more taxes. He pointed out that he pays a percentage less than his employees and that those who make money with money are treated better, perhaps in part because of their donations to political parties.
The economist Jeffrey Sachs has emphasized that the mega rich are enjoying free access to capital, while the poor watch from the sidelines because their jobs are gone. On that train of thought, 16 French millionaires have announced intentions of paying more taxes. In Spain, Salgado has insinuated increased tax pressure on the highest earning individuals. The poetic justice of the rhetoric is beautiful. But empirical evidence against it is overwhelming.
By simply pressing a button, capital rushes to where it will earn the best returns and it tries to avoid high taxes. Countries should establish conditions that attract stable cash flows. To do otherwise is no more than the United States monopolizing resources and usurping the role that they should take on more efficient and sustainable investments. We are already familiar with the employment situation generated by fiscal stimulus during a debt crisis.
In any case, the marginal revenues from increasing taxes on the super-rich would not be sufficient to refill public coffers. The biggest burden will always fall on the middle class. What sounds better is the campaigning rhetoric of some administrations; instead of looking for areas to cut back, they think it is easier to raise taxes. But once taxes are levied against the rich, which sets the stage for raising them for everyone else.
