If You Tax Something, You Get Less of It
Obama in today's WSJ: To rebuild the middle class, I'll give a tax break to 95% of workers and their families. If you work, pay taxes, and make less than $200,000, you'll get a tax cut. If you make more than $250,000, you'll still pay taxes at a lower rate than in the 1990s -- and capital gains and dividend taxes one-third lower than they were under President Reagan.
Translation: Obama intends to raise income taxes on families making over $250,000 and individuals making over $200,000.
Prediction: Some families currently making over $250,000 and some individuals currently making over $200,000 will make adjustments to the timing and amount of their incomes next year so that they'll report less income, to take advantage of the tax cuts for lower income levels, and avoid the tax increase on higher incomes.