By Porter Stansberry in the S&A Digest:
According to IRS data, the bottom 50% of wage earners paid a total of 2.99% of all taxes – almost none. The top 50% paid 97%. With OBAMA!'s new scheme to pay out cash to people who pay little or no taxes (so-called refundable tax credits), more than 50% of American citizens will pay no net federal taxes starting next year.
This revenue policy spells big trouble for America down the road. Why? When more than half of the people in the country aren't paying for any of the costs of government, it becomes impossible to win an election by promising to reduce the size of government, even when doing so becomes critical (like when there's a huge budget crisis or a runaway deficit).
And that's how democracies have always fallen apart historically: The moment the majority is allowed to tax the wealth of the minority away from them, the society falls apart.
Crux note: The S&A Digest comes free with a subscription to Porter Stansberry's Investment Advisory. Click here to learn more...
More from Porter Stansberry:
The outstanding libertarian rant of the week