Well, the news said 4,200, but they might not have all been billionares, some might have just been multimillionares. When the economy GROWS, it is like the tide, ALL boats rise. The economy isn't just a FIXED amount of goods and services. It can INCREASE. When it increases, tax revenues rise. To grow the economy, people must have CAPITAL which is money, land, raw materials, or a factory. People who do have money (the middle class in particular) are not spending, they are saving. During the last bubble, banks loaned out money they really didn't have, in was just on paper. When people didn't pay back their loans, the banks didn't have money for any further loaning. That is the problem with fiat currency Ron Paul talked about. However, the government can do many things to stimulate the economy into growing, just like fertilizer and water for crops. The can APPROVE of drilling, pipeline construction. The can get of the backs of small business and not treat small business like big business with regulations, paperwork, etc, that keep them from growing and hiring. Too many regulations, and some small business just gives up.
For instance, I have a small business contractor that installs pipelines for me. He has himself, his brother (a welder), a son, and two workers. His business probably clears at least $500,000 to $1,000,00 a year. He has trenching machines, backhoes, welding machine and a few trucks. He only pays himself and his brother $75,000 a year, his son less, and his two workers started at $10 an hour, but one has learned how to operate a backhoe over time so his pay goes up to say $20-25 an hour. He could hire more workers, but he is afraid to. Most of the profits go into payments on some of his equipment, diesel fuel, and TAXES. He has to match the social security tax paid to themselves. He has to meet government regulations such as passing welding and plastic fusing testing. He has to periodically send everone for drug testing. He has to buy liscences in every town and county he works in. Now he has to provide health care for everyone. He therefore can't afford to hire anyone else, even though he needs them. All the regulations, he has to pay for. His corporation has to pay 35% in taxes above and beyond all these regulations. Now cutting some, streamlining some, would help him, which thus helps me get lower bid prices on work we need done. If my prices go up, so does your gas bill to pay for these added expenses my company has to pay. Thus we can't spend more money for more pipeline expansions. Government is a parasite on private business, so there is only so much private business can afford so the government MUST CUT back, not grow.
So if you tax too much, it styfiles the economy, and raises prices on everything you buy or service you need. Why not just cut government? What is so hard for liberals to understand the nature of a government too big such as the old Soviet Union which failed.
Problem is, the rules changed for bank lending under Bush. The economy did grow, and it grew fast. I went through it. We were installing mains everywhere. Banks lent money they didn't have thus causing a bubble when people they lent to couldn't pay their mortgages knowing full well they were going to come due. They had stuff like pay only the interest for 5 years, then begin paying the interest and principle (sometimes doubling their payments). They also had no down payments so it was just like renting to them, no investment in their homes. Gasoline rose because Opec kept raising prices in the world's growing economies. People had to start paying for these increasing mortgages and higher gasoline prices. Couldn't do both. They should never had gotten away with fixed mortgages with reasonable down payments and we wouldn't be in this mess. They also should never had gotten away from the gold standard.
