What could go wrong? (Installment #2)

Twice a month, or every other Wednesday, I will be posting a new feature on this blog called “What could go wrong?” in order to illustrate the law of unintended consequences, an iron law that bedevils most, if not all, public policies and reform schemes, no matter how well-intentioned or carefully crafted. (See the NATO example below.) For this installment, I want to highlight President Biden’s proposed tax increases on wealthy taxpayers and on corporations. If history is any guide, however, when we tax the rich to give to the poor we will usually end up with fewer rich and more poor! Specifically, these tax-increase proposals, if enacted, are going to backfire in three possible ways: (i) new investment by the private sector will decline, (ii) fewer new business firms will be started, and (iii) more U.S. companies will just move overseas. Also, a fourth possible result is that fewer taxes will be collected–not more! Don’t say we didn’t warn you!

The Law of Unintended Consequences
Happy Anniversary, Sydjia! (image credit: Ed Dolan)

About F. E. Guerra-Pujol

When I’m not blogging, I am a business law professor at the University of Central Florida.
This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s