The deduction part does help the bottom, and I'm more than fine with it, but this plan really is for the rich. It allows them to continue to gain a stronger stranglehold on everything. Trickle down doesn't work, it only removes capital from the pool available and rich people only reinvest in items (securities, derivatives, etc) that enrich them and their buddies. It doesn't spur real tangible growth that gets people jobs. It spurs getting fatter salaries for those at the top, and does away with them having to provide tangible benefits to their company. They can basically become a hoard of Charlie Weis's running around, getting a fat salary, not needing to showing any improvement other than limp along, and then burning down the program (or company), and moving onto the next one.
The reason for example taxes on the rich were 90% on income back in the 1930s-1960s was to create incentive in paying those rich people in stock and dividends, which forced them to have to perform and care more about the performance of the company, since their pay was directly tied to the company performance. Hence capital gains being not a big tax then since it was seen as the true reward for a job well done for the wealthy. Better company performance that forces you to create jobs and grow tangibly, not sock cash away and sit on it for just you. But now that we've slashed the income tax on the wealthy again and again, we see their salaries soar, and while most if not all CEOs do get stock incentives, it's a mere amount compared to the what many can make in sheer salary.
Think of it as Charlie Weis. If we had a super high tax on salary over let's say 500k, and keep other income like capital gains (we'll call them wins) low, you'd get contracts like this:
Salary: $500k
Gains per win: $100k
That gives incentive to win.
If you have super low tax on the rich, that means you'd want to negotiate to have a super high slary, cause why not:, and if you do nothing to the gains, or try to raise it you get this:
Salary: $5mill
Gains per win 100k
Where is his incentive to win? And if he does win, great, if not, no big deal. But who benefits the most from the first case? Everyone. Who benefits from the second case? Charlie Weis.
So cheer for your little 4k extra, but the house you live in might be burned down. Ever wonder why in a lot of ways we had '07-'08? The Enrons and the like? Give the super rich more cash to play with, they will play with yours too, and if they lose, everyone loses. If this plan was just to double the deduction, and reduce corporate tax by removing all loopholes so the effective tax and actual tax rate were a lot closer. I'd be behind it 110%. The way it is now, it's a sweet morsel with a poisonous core.
Sorry, long /rant
