To the editor:
I fail to understand how more tax cuts for wealthy individuals will fix our economy. This group has experienced the lowest tax rates ever. The Bush tax rates have been in place for 10 years now; where are all the jobs those tax cuts were supposed to create?
The GOP theory is, with the extra money saved on taxes, these wealthy individuals should be able to put their extra money into economy. Counter to the GOP theory, we have learned that these individuals don't take their extra money and spend it. Instead, they put it into savings for a rainy day. While this is smart thinking on their part, it does nothing to help the economy or generate demand for products and services. This means their money never trickles down to the middle class who have been left with unchanged wages and a rising cost of living. Under our current tax system, the middle class ends up with less disposable income with each year that passes. Less disposable income equals less demand for products and services. In business survey after business survey, businesses say a lack of demand for products and services is the No. 1 reason causing them not to expand (hire people and invest).
Mitt Romney's plan to fix the economy is to take the current Bush tax rates and cut them in half for wealthy individuals. Since there is no extra demand, most of this money will end up in savings. Doesn't this just exacerbate the current economic problem leading to even less demand? Let's take a look at what this would mean in a hypothetical tax cut situation. Tax cut monies that end up in savings do twice the hurt to the economy. Before the tax cut, the government was spending tax money into the economy. After the tax cut, the government is spending less money into the economy to pay for the tax cut. If the individuals that receive the tax cut monies don't spend it in the economy immediately, we experience a $2 loss for every tax cut dollar.
In November we have a choice to continue creating a system where everyone prospers, or going back to the failed methods of the last decade were the people at the top prosper on the backs of the middle class.