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Pete Buttigieg claims that Biden’s infrastructure plan will be paid for in 15 years by increasing taxes on the rich. I remember years ago from Bill Clinton on how much the federal government was going to make from his newest tax the rich plan. The idea was to place a special tax on things only the rich buy such as yachts. But, at the end of the day, the federal government took in less than they were before the tax was put in place.
The reason is simple. The rich are rich for a reason. They, simply did not as a general rule buy luxury items in the United States. They would buy, say a yacht from another country in order to avoid the taxes. But, the workers who made yachts in the United States were put out of work because no one was buying the American version of these products anymore. A few years later, Democrats quietly revoked the tax, adding it to another bill where it did not receive much notice.
In comments to NPR Thursday, Buttigieg said:
Over the course of that eight-year vision, we are going to be enhancing the roads and bridges of this country. We’re going to be improving our ports and our airports. We’re going to be delivering better transit and better rail. Those are investments whose benefits will last a lifetime and then some, and that eight years of investment is fully paid for across the 15 years of the tax adjustment, which means by year 16, it’s actually going to reduce the deficit.
The way they plan on financing the infrastructure bill is by raising the corporate tax from 21% to 28%. I*t’s not hard to figure out what the net result will be. Companies will just move their manufacturing plants to a country with a much lower corporate tax.