Can you build a welfare state on the rich?

President Obama and the Democrats love to talk about the rich paying “their fair share” and that if they just raise taxes and increase revenues, the budget problems will go away. I’ve talked about this before on this blog, with examples from California and Maryland. Now, we have another example from the UK. The reality of trying to soak the rich too much is that it leads to diminished revenues for the government. We now have three real-world scenarios that demonstrate the rich, by themselves, can’t support the welfare state and that after a certain amount has been extracted from them, continued taxation results in lower revenue than had the tax rates been left alone.

Bill English, CEO