John Feehery: Speaking Engagements


Hard Work and Taxes

Posted on January 28, 2013

I was watching the Australian Open Finals yesterday morning.  Andy Murray from Great Britain was playing Novak Djokovic of Monte Carlo.

Monte Carlo?  I thought the number one ranked player in the world was from Belgrade, Serbia.  Turns out, Mr. Djokovic moved to the low-tax haven on Monte Carlo because, well, he didn’t want to pay enormously high taxes.

Andy Murray, one of the top British players in history and a rising star, doesn’t have to move to Monte Carlo because Great Britain has a reasonable tax rate, so reasonable that Carla Bruni’s husband, Mr. Sarkozy, the former French Prime Minister, is trying to move there.  He wants to avoid the confiscatory tax rates imposed by his successor.

High taxes became an issue in America, too.

California has become America’s version of France (or Serbia, for that matter).  Phil Mickelson, the famous golfer, recently bitterly complained about California’s new super-tax on the super-wealthy.  He now if forced to pay about 65% of his income to the folks in Sacramento, San Diego and Washington D.C.

My guess is that he will follow Tiger, who long ago moved his operations to Florida, where they don’t have a State Income tax, and they won’t as long as Republicans are running the Sunshine State.

Talking of states, there is a great debate among the states about scrapping the state income tax altogether.  If you are California, New York and Illinois, you keep raising the state income taxes because you need more money because you won’t fix your fix pension problems.  If you are Florida or Texas or maybe Kansas, you want to attract the Phil Mickelsons of the world (talented entrepreneurs who don’t want to hand most of their money over to the government), so you keep your taxes low, keep them confined to a sales tax, and you scrap or never ever threaten to impose a state income tax.

Ireland got into a mess because it decidedly to bail out the bad behavior of European banks, and put the bill on the backs of its citizens.  So, it cut the hell out of spending and it has been a couple of tough years in the Old Sod.  What it didn’t do was raise corporate taxes, and now Ireland is poised to be the first of the PIGS countries to pull out of its financial crisis.  Why?  Because corporations like to do business where they don’t have to pay confiscatory taxes.

I don’t know why the Democrats never get this.  A pig gets fat, while a hog get slaughtered.  You make taxes too high and people (especially the kind of people who create jobs for other people), go somewhere else and do something else.

Djokovic won his match.  Now he can spend his prize money at the casinos of Monte Carlo (which are very nice, by the way) and not worry that it will taken away by some greedy politician in Belgrade.

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