It seems millionaire Nick Hanauer's recent op-ed on why we need to be taxing the rich in America has, as Steve Benen explained, “caused a stir, and with good reason.”
Political Animal – Raise Nick Hanauer's Taxes:
If Hanauer’s name doesn’t sound familiar, he’s a very successful venture capitalist, playing a role in the creation of companies like Amazon.com. This week, he took on a standard Republican talking point: the notion that job creation suffers if taxes go up on the rich. Hanauer explained very well why the GOP’s approach is backwards.
I can start a business based on a great idea, and initially hire dozens or hundreds of people. But if no one can afford to buy what I have to sell, my business will soon fail and all those jobs will evaporate.
That’s why I can say with confidence that rich people don’t create jobs, nor do businesses, large or small. What does lead to more employment is the feedback loop between customers and businesses. And only consumers can set in motion a virtuous cycle that allows companies to survive and thrive and business owners to hire. An ordinary middle-class consumer is far more of a job creator than I ever have been or ever will be.
It appears that Hanauer, unlike GOP policymakers, understands supply and demand, and that three decades of concentrating wealth at the top doesn’t create an economic base that ensures broad prosperity. Republicans can keep lavishing more and more money on the rich, but they’ll only spend so much. [...]
Hanauer’s advice? Raise his taxes, make public investments, and get some money in the pockets of middle-class consumers.
Digby’s take on this rings true: “This is a person who really doesn’t want to kill the golden goose of capitalism but would like to save it. It doesn’t speak well for the future of capitalism that there are so few entrepreneurs like him.”
Be sure to go read the entire editorial here -- Raise Taxes on Rich to Reward True Job Creators: Nick Hanauer.
Hanauer was a guest on Neil Cavuto's show on Fox Business this Wednesday and he did a great job knocking down every one of Cavuto's arguments and straw men as Cavuto desperately tried to rebut Hanauer's assertions on why the rich aren't paying enough in taxes.
Here's the shortened version of their conversation with a tiny bit of paraphrasing and which does not reflect Cavuto constantly interrupting and talking over Hanauer.
CAVUTO: But you pay forty percent of the taxes.
HANAUER: That's because we have all the money.
CAVUTO: Maybe we should find a way to lift the bottom than take it out of the hide of the top.
HANAUER: The only way democratic capitalistic societies have ever been able to lift the bottom is by investing in capacity for the bottom. And the place you have to get that money is from the very tippy top because that's where it all is.
CAVUTO: We have spent trillions on the war on poverty since Lyndon Johnson and the poverty percentage rate is higher than it was when he started the war.
HANAUER: There are a million ways to go about [making people more prosperous] but the idea that the wealthy, people like me, shouldn't pay their fair share in a democratic capitalist society is ludicrous.
CAVUTO: Rich people pay a third of their income in taxes. […] What's the fair share to you?
HANAUER: Rates of growth were greatest when tax rates were at their highest […] The truth is that the truly rich aren't paying thirty percent. They're paying fifteen percent.
CAVUTO: Why don't you draw the line at guys like you who are in a blessed and unique and very small slice crowd?
HANAUER: Here's the problem, it's not a small crowd. There's a ton of people who are making this kind of dough today.
CAVUTO: If you want to pay more Nick, write a check right now.
HANAUER: We don't live in a volunteer society. We live in a society that requires all of us to pull together.
CAVUTO: What about the people who don't want to pay more?
HANAUER: Try using that attitude at the next company meeting at Fox News. I've run a lot of companies and once in a while somebody will pop up with this attitude. You know what we do with those people? We fire them, both because they're useless and they're poisonous to the culture. The simple fact is, things just don't get done on a volunteer basis.
Hanauer also did a great job of pointing out that every civilized country and democratic society has high taxes and high government regulation and there is no country that resembles the supposed Libertarian utopia where no one pays any taxes and where there are no regulations, because those countries in reality are, as he put it, “a hellhole.”
The only thing that could have made me happier about this interview (other than Cavuto not interrupting Hanauer and talking over him) would have been Hanauer asking Cavuto if he'd prefer to live in one of those Libertarian paradises like Somalia.