Why are the Rich Staying Rich While Everyone Else is Getting Poorer? You Need To Know the Truth

Did you know that 90% of all the jobs that were created in the past 10 years, were created by small businesses. Fourty-five percent of all the current employment in the US can also be attributed to small businesses, and you won't believe this.....98% of all the jobs in the private sector can be accredited to small businesses, not large corporations (Forbes, 2009). That’s amazing if you ask me. President Obama even said in March 2009, that "If small businesses fail, we all fail.” He says he wants small businesses to succeeded, but he wants to increase taxes on people making over $200K a year and what he fails to understand is that 99% of small business owners fill their taxes as individuals in order to save money for their businesses. It might seem like these individuals are making over $200k, but they have to pay their employees and their overhead fees and whatever profit is left they typically recycle back into their business. These aren’t wealthy people. They’re hard working middle class people and the more money they save, the more employees they are able to hire, which means fewer people will be out of work and the better off our economy will be.

Obama says that he only wants to increase taxes for "the rich" but the truth is the rich never pay taxes anyway because their accountants find loop holes in the system, or they stash their cash in foreign accounts. The billionaire Warren Buffet even admitted that he never pays taxes. Thus, middle class people and small businesses are stuck with the bruden and are never able to hire more people. Instead they have to lay off people or they eventually go out of business. And it's becoming more difficult for ordinary people to start their own business because of the ever increasing tax barrier, and are becoming stuck at dead end jobs were they have no opportunity for upward mobility. You might think that Obama's tax increase won't affect you but it will because when businesses suffer, unemployment goes up and the price of food, rent, utilities and everything else goes up as well. The economy gets worse, rich people stay rich and everyone else gets poorer.

If the president would instead enforce a low flat tax for all, then rich people would finally stop stashing their cash in foreign accounts and the government would be able to bring in huge amounts of revenue without hurting the rest of us. This was recently done in Slovakia, and the wealthy there couldn't find loop holes in the tax code anymore because it became so simple. Sales tax and all hidden taxes were abolished and remarkably, the poor didn't end up paying anymore then they had already been paying but their standard of living went up because the price of food an everything else went down (Forbes, 2009). When President John F. Kennedy enacted across-the-board tax reductions, including dropping the top tax rate, the economy boomed in the 60's (Forbes, 2009). Of course implementing a low flat tax will never happen because that would mean that the tax code would become too simple, so simple that no one would ever be able to evade it and politicians don't want that to happen because they use the tax code to hurt their enemies and reward those who are in step with their agenda. Why else would the government let Charles Rangel, the man you actually writes the tax code, and Timothy Geithner, the man who is actually in charge of overseeing the tax code, get away with not paying thousands of dollars in tax but will go after someone as irrelevant (but a perceived enemy none the less) as Joe the Plumber?

Obama is right that "If small businesses fail, we all fail," but unfortunately his tax increases on small businesses will be the very reason why they fail in the first place.

Read more about Slovakia's flat tax
http://www.forbes.com/free_forbes/2005/0606/031.html
http://hbswk.hbs.edu/item/5653.html