Taxing the rich will benefit our economy

Since Both my opponent and I have forfeited, it seems best that I will further argue my first argument in this round, while attempted to refute my opponents as well. Since both my argument and my opponents are somewhat similar (though arguing opposite ends), and we will have no last round purely for rebuttals, I will try to refute his argument here, since I laid out my argument in depth in the second round. My opponent starts by making this statement: "The problem with the U.S economy is that our government has their hand in the free market which is causing a kink in the natural course of capitalism." Since the policies of Alexander Hamilton in George Washington's government (the first Administration in US history), the Federal Government has played a role in the economy. Hamilton's policies were markedly protectionist. [1] This myth that the "free market" is self regulating and that there is a "natural course" of capitalism is superstition. Every presidential administration in history has levied taxes and regulated the economy, so to attribute economic recession to this is inaccurate. Moreover, my opponent asserts that "Capitalism only involves the private sector". This is also false. For example, the issuing of government bonds is capitalism. The government guarantees a return rate for investment- which is the most simple and fundamental role of capitalism. Moreover, capitalism relies on the existence of incorporated businesses (called corporations) to create shareholders and distribute risk, but a corporate charter has always been awarded by the US government. My opponents biggest mistake in attacking my argument is stating that infrastructure spending causes "temporary" jobs. True, if the government pays a construction worker to build a bridge, when the bridge is finished his job is finished, but then all service sector jobs are temporary. But the true misunderstanding of my opponent is that while the construction worker may only have a temporary employment, his income that is spend into the economy causes permanent growth, which on a large enough scale raises demand, and thus incentivizes the private sector to hire for "permanent" positions. If my opponent understood my position as merely arguing that public works would lower the unemployment rate directly, I must have been unclear. My argument, the Keynesian argument, the argument of established economic policy accepted by economists, is that the income by temporarily hired people will be spent back into the economy, which creates growth. My opponents scenario is dead wrong. I have worked for several small businesses, and have discussed his scenario with my bosses many times. Consider my opponents scenario: the economy is stagnant (as it is now), and small business owners have given a 50,000 tax cut. Since business is not very good, due to the economy, hiring a new employee for 25,000 a year would cost more to the employer than he would gain in productivity. This is a very simple truth. In a time when there is no demand in the economy, hiring is always a direct loss. Capitalism is all about creating the largest profit possible, and even if small businesses' tax rate was reduced to 0%, hiring would not increase. An employer simply subtracts wages from productivity and if the difference is negative, he will put the tax cut in the bank, where it allows for greatest profit. Therefore, my opponent is incorrect in his assertion that supply creates demand, and capitalism is a top down structure. The great disposable income the consumer has, the more money is spent into the service economy. And while the Christian Scientist Monitor article you cited states that the rich pay the highest taxes, you forget to mention that in the past 5 years the percentage of total income earned by the top 1% in the US is at record highs [2]. In 2007 the top 1% earned 23.5% of all income in the US, and this number is rising. So, if the richest Americans have received greater proportional wealth since the beginning of the recession in 2008, why has there been increasing unemployment. Whether you like Obama or hate him, there is one thing we can all agree on: he is ineffective in passing his agenda. The tax structure is identical to that under Bush. Corporate profits in 2011 were the highest in 60 years [3], yet hiring is at a standstill. This is easily explained. Since demand is still so low in the economy, the wealthiest Americans and corporations still have reason to invest in new employees. Reluctant corporations holding assets to keep profits high instead of hiring people is capitalism running its "natural" course. Instead of allowing the wealthy to sit on assets and wait for the economy to recover, we the people through our government ought to instead reinvest these funds into the middle class, creating a boom in income, and a boom in spending. Since most middle class people spend all of their income, increasing their income would increase activity in the markets, which would in turn increase growth in the private sector, and make hiring a new employee a net gain in the productivity the employee creates. Thank you [1]http://en.wikipedia.org...[2] http://www.economist.com...[3] http://www.nytimes.com...