11/24/2009, Pre-Publication: LETTER TO THE EDITOR, Submitted to the Corvallis Gazette-Times by John H. Detweiler - On January 26th we are going to vote on raising taxes on nasty corporations and the undeserving rich. Presumably there will be negative consequences for all sorts of groups if we don't raise taxes. On the other hand, there will be negative consequences for business if we do raise taxes.
Corporations make decisions in their best interests as they see them. Raising taxes on corporations increase their costs of doing business in Oregon. If they can, they will raise prices on their goods and services to recover those costs. If they can't raise prices, they will cut costs other ways. They may fire employees. If they have to accept reduced profits, they will do so in the short run. In the longer run, they may move out of Oregon or choose not to expand in Oregon.
The rich also make decisions in their best interests as they see them. In the short run they will pay the tax increase. In the longer run, they will change their behavior to avoid the tax increase. If they are professionals, they may reduce the amount of services they sell because they don't earn enough to make the marginal work worthwhile. If they are small business owners, they may reduce the size of their businesses firing employees and contracting the economy. They may move out of Oregon.
If we treat corporations and the rich as endless sources of funds, they will make decisions to avoid being treated as money trees.
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John H. Detweiler; web page =>
www.peak.org/~detweij
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