At Cato Institute, Chris Edwards, Director of Tax Policy Studies, explains that despite the trillions Democrats want to spend, their bills won’t fulfill the promises they are making. He writes (abridged):
As Democrats try to push their tax and spending bills through Congress, there is a gulf between what they are promising and what their bills would actually do.
President Joe Biden often promises high‐paying jobs, but his business tax increases would actually produce fewer jobs with lower wages. Democrats say they oppose corporate welfare, but their bills include billions of dollars in subsidies for energy companies and other businesses.
Rhetoric also differs from reality on technology policy.
Our combined federal‐state capital gains tax rate of 29% is already higher than the average rate in Europe of just 19.5%. Biden’s proposed increase would push our tax rate up to 48%, more than double the European average. Democrats in the House would push our rate up to 37%.
Democrats want to increase federal subsidies for research, but private capital is far more important for spurring innovation. Consider that the mRNA technology behind the Moderna and BioNTech‐Pfizer COVID-19 vaccines was developed with $3 billion in funding from angel investors and venture capitalists.
Director of Tax Policy Studies, Cato Institute and Editor, DownsizingGovernment.org
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