by Darren Robertson

Created on: August 13, 2010

The memory of 1982 lingers like thick smoke in a windowless room.  I was very young at the time, too young to understand what was happening, but I just remember there were a lot of unhappy people around.

It was during this year that interest rates spiked, hitting above 20%.  Many small businesses in my area were affected and people lost a great deal of wealth in a short period of time.

My father owned a restaurant that didn't make it through to 1983.  The weight of that interest spike on a young business was too much to handle.  Hit with bad timing and mounting expenses, my father had to walk away from his business.

What I have learned over the years about 1982 is that the government can always pull itself out of any tight situation because of their control over taxation.  When disaster strikes, simply raise taxes or tax a previously untaxed sector, and the government is covered.

Much like high interest rates, high tax rates spoil investment.  People of means, those who have worked to build wealth, have a difficult time investing when faced with high tax rates.  A person with wealth, and knowledge, wouldn't invest in a state or province where the taxes were so high that they couldn't make a return on investment.  It doesn't make sense.

For those of us with moderate means, consider home ownership.  In New Brunswick our government is promising, if elected in the next provincial election, to freeze property taxes for two years.  For the past six years that I have owned a home, the tax rates have increased.  I welcome a tax freeze.

This is good for homeownership.  It is difficult for people to even consider home ownership if they are priced out of the market by high taxes.  Higher property taxes mean people have less money to invest in their homes as well, possibly affecting the value.

We have to be careful as well when considering taxing the rich more to "spread the wealth".  I used to buy into this thought, but no longer.  If we taxed the rich more, they will do one of several things.  They will leave our country for another that won't tax them as heavily.  They will shut down operations, affecting employment.  Or they will run for government in the hopes of changing the system to be more favourable for them.  And the last thing we want is Donald Trump as President.  We need him in the business world.  It would be a great loss to the world if he

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