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Raising taxes does work since the tax level in this country is quite low. It has a long way to go to catch up to France, Germany, etc. If raising taxes to the

Raising taxes does work since the tax level in this country is quite low. It has a long way to go to catch up to France, Germany, etc. If raising taxes to the level of Germany would cause such a massive outflow of capital (which could be taxed at the exit point) then why does Germany have so much capital? Wouldn't the same thing happen to Germany? The current tax burden as a percent of GDP in the U.S. is low by U.S. standards of the last 50 years and quite low relative to other industrialized nations. The so called fiscal problem we have is easily fixable. Raising taxes is a viable strategy. http://paul.kedrosky.com/archives/2011/07/tax-burdens-around-the-world.html http://paul.kedrosky.com/archives/2011/07/tax-burdens-around...

bd_at_rivenhill 15y ago
If raising taxes to the level of Germany would cause such a massive outflow of capital (which could be taxed at the exit point) then why does Germany have so much capital? You're missing the fact that there are significant cultural differences between Germans and Americans. Germans seem to consider this tax rate a reasonable price to pay in order to maintain their desired social contract. Americans (especially the wealthier ones) would decide that they are getting screwed by a corrupt system and would start looking for a way to get out of paying. Funny thing is that the Germans are starting to act like Americans when it comes to paying to bail out Greeks, Italians, etc. so I suspect it boils down to Germans trusting other Germans more than Americans trust other Americans.