Their goals are honorable and are designed to make all things fair and equal in our society. They should never be held responsible for those actions, even if it really screws up the economy, or in this case, the tax structure. At least that is what we are told to believe
One of the consequences of the bail out plan, or TARP as it is being referred to now, is that the government has injected itself into the free market for the stated noble purpose of saving the loyal voters who pleaded with them to save them from themselves. This group is now known as the 52%. However, much to Republican disdain, our current president, in the name of compassion and a new tone, had decided to hand the Democrats exactly the ultimate in a gift wrapped present. It was the Bail Out, or TARP.
Now one of the strings attached to the TARP money involved the corporate executives forgoing their enormous bonuses. I can actually understand the logic behind that string. No American taxpayer wants their tax money to go to an executive’s multimillion dollar bonus. However, if you are going to open the door to government ownership or control of private industry, government bureaucratic rules go with it. Consequently, free markets die, or are at a minimum become distorted. That distortion also creates a distortion in taxes paid because of the corporation’s now distorted fiscal behavior.
So, what does this have to do with the law of unintended consequences? It seems that Goldman Sachs executives have forgone their Christmas bonuses. Does anyone realize just how dramatic of an impact Wall St has on the taxes in New York? In the moment of that one decision, Goldman Sachs denied New York 178 million dollars in tax revenue!
It seems, as this news article specifically states, Losing tax revenue from bonuses was a big hit to New York’s finances because Wall Street taxes accounted for 30 percent of state revenue in the last fiscal quarter.
Is it any reason that a Democrat controlled state and city has become a tax nightmare? They demand that the executives don’t get any bonuses, and then as they lose millions in revenue from those bonuses, they raise everyone else’s taxes!
I can hardly wait until this is replicated on a national level!
The “Obama Super Bail Out” for the entire economy is coming at us in January. I wonder how devastating the laws of unintended consequences will hit us all from that one piece of legislation.
The other big item on the governments plate, courtesy of our current presidents compassion is an never ending bridge loan to save the United Auto Workers Union, and the government dictating what cars will be built that no one will buy. I can hardly wait for that disaster to unravel before our eyes too.
The government is always the problem and only is capable of making things worse. Now it will be magnified beyond anyone’s imagination. I do not know if I should fasten my seat belt or pass the popcorn. I think in this instance, it calls for both.