Middle Class Will Be Most Victimized By a 4th Bracket for 1 Percent

Originally Published in RealClearMarkets on 10/31/17.

Here’s a truly rhetorical question: who among us would reject higher compensation? Our work is our expression of our desire to get, and higher pay is the path to getting more in return for what we do each day.

And with it established that most of us would like to earn more, it’s worth asking how. Intuitively, we all know the answer. This includes government workers. They maybe know best: rising pay for those in the employ of government is an effect of rising tax receipts. In that case, is it any surprise that federal compensation has grown so substantially since the 1980s? Not really. Federal revenues have soared.

Applied to the private sector, just as rising federal compensation is an effect of federal tax collections, so is private sector pay an effect of what’s not taxed. If the federal tax burden is reduced, there’s logically more funding for private-sector opportunity. This is a statement of the obvious, and one most obviated by government pay.