THE PRESIDENT'S TAX PLAN WILL MAKE THE POOR POORER by RON PAUL

In tonight’s State of the Union message, the President will tell the American people that the rich should be taxed more to help the middle class. To do this, President Obama will raise inheritance and capital gains taxes. But in a free market, this is where investment money comes from. His tax plan will destroy capital – the life-blood of a free market. By reducing capital savings, the President’s move will place additional pressure on the Fed to create "capital" out of thin air. That means the Fed will accelerate the (virtual) printing presses and thus reduce the value of the dollar for everyone. The politicians love this approach, because they will then claim responsibility, along with the Fed, to distribute all of the newly created dollars. In the process, the market rate of interest is eliminated which is the source of mal-investment and bubbles.