If you’re feeling good about the economy, you’re not alone. But as market experts like Steven Moore caution, the recovery of the economy faces its biggest obstacle with a Biden administration bent on raising taxes.
Rallying with the same enthusiasm that Americans are returning to daily life, Wall Street marched through a 4th week of gains. Combined with America leading in vaccine distribution, the optimism in the markets can only spell good news for the post-pandemic economy, according to Moore.
“This summer, I think you’re going to see really good news on the economy, as we get those businesses reopened,” Moore said.
But the specter of Biden tax increases pulled the plug on Friday, sinking the Dow 300 points as investors responded to planned hikes in the capital gains tax. The latest announcement comes on a string of Biden tax proposals that take aim at corporations and wealthy investors. But instead of just punishing jobmakers, Moore told The Cats Roundtable Biden’s latest proposal would spell net loss to millions of American 401k and pension plans.
“This would very negatively affect the return on your retirement income or investment,” Moore warned. “I think it’s a terrible idea, to almost double the capital gains tax to a higher rate than we’ve had in this country in 50 years.”
As Biden takes aim at investors, the damage will reverberate from Wall Street to Main Street, hurting investors, small business owners, and the American workforce alike.
That’s because investors themselves will be more unwilling to risk capital on the next Apple, Nike, or Walmart if nearly half of that investment will be siphoned by Uncle Sam.
‘If you tell those people, ‘Oh by the way, and if you gain, if you actually make money, the government’s going to take half of it away in taxes’–who’s going to invest in these start-up businesses?” Moore asked.
Moore was particularly concerned American economic prestige was being undermined by Biden’s tax plans. He pointed to hostile Democratic tax hikes in New York, which have led thousands of companies to leave the state, as an example of what would happen under Biden’s federal tax proposals.
“I think because of these big tax increases in New York and also federally, we’re putting in jeopardy our leadership in terms of the financial leadership that we provide for the rest of the world,” Moore told The Cats Roundtable, “and I think it puts the dollar at risk as the world’s reserve currency, quite frankly.”
To Moore, the Democratic war on investors was out of step with the party even in recent memory, and perhaps most importantly, out of step with the pulse of the American people.
“We should be the lowest taxed country in the world,” Moore told The Cats Roundtable. “Under the Biden plan, guess what country has the highest capital gains tax in the entire world? The United States of America!”
While Democratic presidents such as Bill Clinton understood the need to balance federal taxes in a way that favors economic growth, the Democratic Party of the 21st century has gone rogue. The new, radical incarnation seems bent on punishing the job-making class that puts American markets heads above any other.
“Democrats understood you have to have low taxes and fairer taxes to make the economy grow,” Moore told The Cats Roundtable. “You can’t just tax and tax and tax and spend and spend and spend—that’s a formula for disaster.”
Listen to the interview below