Here’s the problem. Let’s say you are that rich person who has just made a ton of money. With the tax brackets as low as they are, all you need to do is have some good investments. When your tax bracket get into the teens, it’s pretty easy to make investments good enough to offset that kind of tax. With that you can hang on to your money forever.  What is it about this arrangement that would make you want to spend that money to start a new business , since most new businesses fail anyway?… You are better of hanging on to your money since the statistics are in your favor.

Here is how you create jobs. Tax money that doesn’t move. The tax rate used to be around 73% for the highest tax brackets. That is a high enough rate to get me to spend my money before it’s taxed.  If you know you were going to lose that much money by hanging on to it, what would you do? I’d start a new business and create some jobs. Just look at the numbers. Loose more than half your income or put it someplace where it will do some work. Even if you invest in a new business and it fails, there are still tax breaks for that. The tax system should be used as an influence to have money put to good use, like starting new businesses, not one that rewards risky strange complicated investments that add nothing to the economy and only enrich the most wealthy on the backs of the middle class.

The way to create jobs is to tax stagnant money, and I don’t mean 401K’s.  I mean money that is in the coffers of the rich and huge corporations. If they have to use the money in the same tax year as it was earned, you would see lot’s of investments, improvement and upgrades.  All of which creates jobs.