Investors are fickle and have billions of investment options open to them. They don't need to worry about what tax rate a corporation pays, and only care about what the return will be for them at any given risk tolerance.
So businesses need to maximize the after-tax profit. Other costs will be squeezed to deal with the higher cost of business and the shifted supply curve. The costs will be shifted to people who are least able to negotiate. So people who desperately need a job will take a lower wage than a fat cat with a golden umbrella who can walk away from a paltry 1.5 million dollar salary.
I can get great prices on vacations, electronics, high end clothing and any given luxury. A soft economy gives me that negotiation. But my rent, food and other necessities are through the roof, and I have to suck it up just like a person making half my salary. But it hurts me a lot less than a person making half my salary.
Taxation is one method we can ameliorate the inequalities of the market. By demanding the corporations do the heavy lifting, you're instead exacerbating the inequalities for faux 'economic justice'.
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Date: 23/2/12 18:51 (UTC)Investors are fickle and have billions of investment options open to them. They don't need to worry about what tax rate a corporation pays, and only care about what the return will be for them at any given risk tolerance.
So businesses need to maximize the after-tax profit. Other costs will be squeezed to deal with the higher cost of business and the shifted supply curve. The costs will be shifted to people who are least able to negotiate. So people who desperately need a job will take a lower wage than a fat cat with a golden umbrella who can walk away from a paltry 1.5 million dollar salary.
I can get great prices on vacations, electronics, high end clothing and any given luxury. A soft economy gives me that negotiation. But my rent, food and other necessities are through the roof, and I have to suck it up just like a person making half my salary. But it hurts me a lot less than a person making half my salary.
Taxation is one method we can ameliorate the inequalities of the market. By demanding the corporations do the heavy lifting, you're instead exacerbating the inequalities for faux 'economic justice'.