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FORBES: Bluest States Stand To Lose Most If Obama Gets His Tax On The Wealthy

Where do you stand on the "fiscal cliff?"

As Democrats and Republicans wrangle over the best way to avoid the “fiscal cliff,” Forbes has a story out that argues it’s the bluest—and richest—states that may have clamored loudest in support of imposing higher taxes on the wealthiest U.S. earners.

“With their enthusiastic backing of President Obama and the Democratic Party on Election Day, the bluest parts of America may have embraced a program utterly at odds with their economic self-interest,” writes Joel Kotkin in his Dec. 4 piece, “The Blue-State Suicide Pact,” published in Forbes.

As the Bush tax cuts get set to expire in January, and hence the United States supposedly positioned to fall over the fiscal cliff, Republicans want to cut social programs to spare the country whereas Democrats want to impose higher taxes on earners that exceed $250,000 annually.

Kotkin’s article argues one can see irony in the Democratic proposition by examining class distribution in the country.

“The top 10 states with the largest percentage of ‘rich’ households under the Obama formula include true blue bastions Washington, D.C., which has the highest concentration of big earners, Connecticut, New Jersey, Maryland, Massachusetts, New York, California and Hawaii. The only historic ‘swing state’ in the top six is Virginia, due largely to the presence of the affluent suburbs of the capital. These same states, according to the Tax Foundation, would benefit the most from an extension of the much-lambasted Bush tax cuts,” Kotkin writes.

According to Kotkin’s article, if the Bush tax cuts expire without a backup plan in place, the average tax increase for middle-class Californians will be $4,242 in 2013.

Kotkin doesn’t rally in favor of Obama’s plan. Instead, he says it’s doubtful that higher taxes on the rich will make the poor’s prospects of escaping poverty much brighter.

“For the most part, the economies of the key blue regions are very dependent on the earnings of the mass affluent class, and their spending is critical to overall growth,” he writes.

Which is perhaps why Kotkin criticizes Republicans in his article:

“If they [the Republicans] were something other than the stupid party, or perhaps a bit more cynical, they would respond to the President’s tax proposals by taking a line from their doddering cultural icon, Clint Eastwood: make my day.”

Egoetz December 12, 2012 at 03:01 PM
Aw! What a shame. Is there anything I can do before I bust out laughing?
George Mills December 12, 2012 at 10:34 PM
Once again the ignorant california voter stikes again! Obama- Jerry Brown- Props 30 and 32, such fools! Why can people not see the truth. Look at the 24 right to work states , all of them are doing better than californai. And yet we keep listening to the Unions- Fools! The unions care nothing about you,The members or the state. It is all about stuffing their pockets with $$$$$$.

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