Imagine a curve. On the left hand side the value is zero. Then, as you move from left to right, the slope goes up peaking somewhere then slides down back to zero. That’s the Laffer Curve.
If you tax income at 0%, you realize $0.00 of tax revenue. If you tax income at 100% you will also realize $0.00 of tax revenue; no one works for free. In between is the sweet spot.
And it appears that, for Lefty, a 63% take is just too much:
LA QUINTA, Calf. — Phil Mickelson started his 2013 PGA Tour season at the Humana Challenge in partnership with the Clinton Foundation with a tie for 37th place. But after a final-round 66, Mickelson did more than hint that the 2014 season may see some big changes for the World Golf Hall of Famer.
“Well, it’s been an interesting offseason. And I’m going to have to make some drastic changes,” Mickelson said at the Palmer Course at PGA West in La Quinta. “I’m not going to jump the gun and do it right away, but I will be making some drastic changes.”
And what changes might he be making?
PHIL MICKELSON: Well, it’s been an interesting offseason. And I’m going to have to make some drastic changes. I’m not going to jump the gun and do it right away, but I will be making some drastic changes.
Q. Meaning leaving from California?
PHIL MICKELSON: I’m not sure.
Q. Moving to Canada?
PHIL MICKELSON: I’m not sure what exactly, you know, I’m going to do yet. I’ll probably talk about it more in depth next week. I’m not going to jump the gun, but there are going to be some. There are going to be some drastic changes for me because I happen to be in that zone that has been targeted both federally and by the state and, you know, it doesn’t work for me right now. So I’m going to have to make some changes.
And why does he think he needs to make these changes?
PHIL MICKELSON: Yeah. I’ll probably go into it more next year or next week. But if you add up, if you add up all the federal and you look at the disability and the unemployment and the Social Security and the state, my tax rate’s 62, 63 percent. So I’ve got to make some decisions on what I’m going to do.
France learned it. And now California is about to. When you tax the living snot out of people they are going to react. They’ll either move or quit.
And that results in $0.00 tax revenue.