Here's Fred Barnes at the Weekly Standard:
President Obama insists he's a free-market guy. But you have to wonder whether he understands how a free economy really works. His policies and his words--especially what he said at his press conference this week--suggest his sense of what makes economies grow and how people are affected by government policies is surprisingly weak.Although it's a minor part of Obama's budget, the idea of putting a cap on the deductibility of charitable contributions from the wealthy is downright un-American. At its heart, the effort suggests that the government is better able to distribute funds than millions of citizens. In a roundabout way, that was the idea behind the 1990 "luxury tax" to take money away from the wealthy before they could spend it.
In 1990 the Joint Committee on Taxation projected that the 1991 revenue yield from luxury taxes would be $31 million. It was $16.6 million. Why? Because (surprise!) the taxation changed behavior: Fewer people bought the taxed products. Demand went down when prices went up. Washington was amazed. People bought yachts overseas. Who would have thought it?With the yacht industry crippled, the luxury tax was repealed in 1993 by a sensible Bill Clinton. On the other hand, neither candidate Obama or president Obama has shown much tolerance for real economic results as long as he can ride the populist wave.
According to a study done for the Joint Economic Committee, the tax destroyed 330 jobs in jewelry manufacturing, 1,470 in the aircraft industry and 7,600 in the boating industry. The job losses cost the government a total of $24.2 million in unemployment benefits and lost income tax revenues. So the net effect of the taxes was a loss of $7.6 million in fiscal 1991, which means the government projection was off by $38.6 million.
Related – Another "bad" group is targeted: "Proposed taxes on oil companies will be paid at the pump." By you, that is.
And this – American Thinker: "Class envy has been a defining staple of the left for centuries, from the frenzied mobs leaping around the French guillotines to the Soviets to, well, the new masses circling AIG executives today." (H/T Maggie's Farm)