To the Editor,
Those who would argue that higher taxes on large businesses and high wage earners will cripple the economy need to update their economics.
Contrary to their self- interested ideology, the true ‘job creators’ are not business people, but ordinary consumers.
Low wages, insecure jobs, high debt levels exacerbated by outrageous credit card interest rates have severely cut demand for goods and services. Regardless of tax rates or regulation, if demand is absent, smart business will wait for better times to hire workers.
Strong gross domestic product growth in past times of high taxation and corporations currently sitting on mountains of reserved cash despite low taxes, low interest rates, negligible regulation and labour powerlessness proves this.
If high taxes drives away investment, Norway, Finland and other Nordic states would be empty of people. Instead, they are amongst the most stable, wealthy countries of Europe.
Despite the myth of the ‘free market,’ when corporations refuse to spend because of a dearth of demand, government must step up to the plate.
While no one willingly chooses debt, austerity as practised throughout the west shows that government cutbacks at the same time as business and consumers merely guarantees continued economic woe – and even more debt.
Our problem lies in a lack of revenue for government to exercise its job creating power for public benefit.
So we limp along, using bad, outdated economics as our crutch when in fact belief in magic would be just as effective.