Are you the hapless moron the Left considers you to be? 

Do you believe the wealthy are not paying their fair share?.  Are individuals with an effective tax rate of 15% a drag on society?  Should investments be taxed at the same rate as income?

If you answered yes to any or all of the above, hustle back to your village; it's missing its idiot.

Don’t fret, though.  Understanding a few simple facts can elevate you to respected elder status.

First, wealthy people often have a lower effective tax rate because the bulk of their earnings tend to come from investments.  As a nation, we’ve chosen to tax investment at a lower rate—not because of a devious bias toward those with available capital, but because investing has risks and attracting investment dollars is VERY beneficial to society—particularly to the middle and poorer classes.

Let me address the risk element first.  An investment is often taxed differently than earned income (e.g. salary) because one, you don’t have to invest so inducements help, and two, its value can decrease.  In fact, it can go to zero.  So, in order to get individuals and businesses to voluntarily risk their capital, it is advisable to reward them with a lower tax rate (should the investment increase in value) to compensate for the risk that it might very well decline.  That’s common sense.  Rational people/businesses are willing to jeopardize their capital when they perceive the potential gain to be worth risking the possible loss.  It can be hard to justify putting money into a chancy endeavor when even if it makes money (often a long shot), half the gains or more will be taxed away.  That’s normally not a bet for the prudent.

So, what about the ‘VERY beneficial to society’ part?

I said that investment is good, and others say it all the time.  But why?  Can’t we just work hard, collect our salaries, and go home?  Sure, but doing so en mass would have catastrophic consequences for our culture and standard of living.  A few examples are in order.

Consider municipal bonds.  Municipal bonds are the way in which local communities, cities, and states acquire the capital necessary to fund various essential services and large projects (e.g. water/sewage treatment plants, roads and bridges, schools, etc.).  These types of undertakings are hugely expensive and almost always not able to be paid for out of available funds.  They frequently need to be completed now, but paid for over time via debt instruments (i.e. bonds)—not unlike the way most people purchase cars and homes.  If there was not a vibrant market (properly incented) for municipal bonds, these towns, cities, and states would have to pay orders of magnitude more to attract the capital necessary to fund their projects.  What does that mean in simple terms?  Instead of paying a  4, 5, or 6% interest rate on a loan, a city might be forced to pay 10, 15, or 20%.  Why?  Because when there are fewer interested buyers of a municipal bond (lower demand) due to less favorable tax treatment, the cost (i.e. interest rate) of reducing the bond supply is increased considerably.  Such a dramatic increase in the cost of capital would obviously have a devastating impact on the locale in question—likely manifested in a material reduction of services and infrastructure improvements.  And concomitantly, a substantial cutback in jobs tied to the provision of said services and infrastructure improvements.

How about corporate stocks and bonds?  Corporate stocks and bonds are generally the ways in which companies, particularly those in the expansion phase, fund growth.  And growth means more jobs—up and down the supply chain.  Just like with municipal bonds, if the market for corporate instruments is not robust, then the cost of acquiring the necessary expansion capital for companies rises substantially.  Elevated costs translates into fewer/smaller investments in new plant and equipment and/or a reduction in hiring.  The bottom line is a net negative impact to the economy through higher product/service prices and scarcity of jobs.

The story is just the same for mortgage securities.  If banks and other holders of mortgages can’t get them off their books (i.e. sell them), they have less capital available for additional lending and other GDP-enhancing activities.  So, when the supply of a good/service (i.e. money available to loan in the form of a mortgage) is constrained, steady or increasing demand will drive up its price (i.e. mortgage rate).  In case you’re still confused, that means higher mortgage rates and all of its economic activity reducing consequences.

Got it?

Try to see through the moronic populism of the Left and politically motivated and destructive nonsense of Newt Gingrich and others on the Right.

Actions have consequences.

You think you might want to stick it to the rich (despite the fact that the top 1, 5, and 10% account for 40, 60, and 70% of tax revenue)?  Well, the least affected people will be the rich.  Instead, you’ll be crushing everybody else—the folks who need government services, new and better schools, a mortgage, a car loan, a small business line of credit, or a job.

And oh by the way, you’ll be hurting unions and the elderly, too—whose pensions are levered to all of the aforementioned investment vehicles…and some others I neglected to cite.

Next time someone tries to hit you with the ‘fairness’ argument, KO him/her with the facts.

There are a whole lot of "villages" out there.  Educate one idiot at a time.

Don’t worry; they're not endangered.  There are still 535 of them in the Capitol…and a bunch more on Pennsylvania Avenue.