One year ago, the Wall Street Journal reported on the inverse relationship between higher taxes rates and revenue streams (click the title link to see the original). In short, they reported an often observed truth - within limits, tax rate reductions lead to better reporting and more complete payment, thus increasing government income streams. This should make sense even on a basic and general level. If one is not taxed unreasonably, one is more likely to report full income, and not attempt to evade one's tax burden. If one is taxed at the 70% level, however, 'escape and evasion' becomes the modus operandi. That is exactly what Obama is proposing to do, and its only real effect is going to be to raise the deficit.
The current deficit is expected to top $ 1 trillion shortly, and even if Obama can get Congress to limit tax increases to the $120 K mark of income (yes, the goal has moved again), and even if not one household in that income bracket made any attempt to evade taxation, that tax burden will not overcome the current deficit. If all of Obama's spending proposals go through, the deficit is likely to top $4 trillion in short order, leaving two choices: increases taxes on everyone from $40K/annually on up, or leave a huge deficit that will be the responsibility of several generations to pay. This is not a fiscal policy that will lead to increased employment and growth - it's a jobs-killer. If one adds in the increased taxes on Capitol Gains, Medicare, health insurance, etc., it becomes impossible to maintain a limit on who sees a tax increase and who pays. In fact, those additional tax burdens ensure that everyone sees a tax increase, and that our grandchildren will be paying for the country's addiction to easy spending and welfare. John McCain is right - what we need is a return to fiscal discipline, limited spending, and the right policy to grow jobs and the economy, namely a freeze or reduction in taxes. Do the right thing for your country and your children - Vote McCain.