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The 2016 election of Donald Trump shattered political orthodoxies. Now that fusionism — the philosophy that combined libertarian economics with conservatism — is collapsing, conservatives will have to adapt to new fiscal, political, and social realities.
Given the recent discussions of taxation during this election year, conservatives need to revisit the possibility of increasing taxes on the rich. Not only would such a policy assist us in achieving fiscally conservative policy goals, but, more importantly, it would help us conserve social order.
There are many objections to this idea. Many will say they already do pay more. Michael Strain over at Bloomberg makes this case. However, Strain relies on some fuzzy math, designed to obfuscate rather than illuminate. For one thing, Strain’s analysis relies solely on federal taxes. But the New York Times’ David Leonhardt pointed out that we need to include state and local taxes.
As usual, the main question is, who are we talking about, exactly? Others have pointed to the overall tax structure to prove that “the rich” do pay higher taxes. However, when we isolate the true elite — often numerated as the top 400 wealthiest — it’s clear that they pay a lower effective rate across the board than any other group. (RELATED: Opinion: No, The Rich Don’t Pay Fewer Taxes Than The Rest Of Us)
Economists Saez and Zucman noted that while the top 400 pay an effective rate of 23%, less than 1% of their combined total income, the rest of Americans pay anywhere from 25% to 30% from combined federal, state and local taxes. Furthermore, the tax code rewards deductions available only to the elite. These deductions amplify the unfairness of a system that already prioritizes capital gains over middle-class wages. While on paper, one can argue the American tax code makes the elite pay a significant amount in taxes, in reality the system is largely rigged in their favor.
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