Rand Paul: 'You can't punish the rich'

Rand Paul (R), the Tea Party candidate vying for Kentucky's Senate seat in November, warned this week that allowing tax cuts to expire for the wealthy will only hurt everyone else.

"You can't punish the rich people," Paul told Fox News' Sean Hannity Friday night. "You end up punishing the people who work for them, or you punish the people who they buy things from."

A series of tax cuts enacted under the Bush administration expire at the end of 2010, stirring a contentious debate on Capitol Hill over whether Congress should prevent it from happening. 

Behind President Obama, the Democrats are pushing a plan to extend the tax cuts to most Americans, while allowing rates to go up for the wealthiest families — those earning more than $250,000 a year. The Republicans, on the other hand, want to extend the tax cuts to everyone. 

Neither plan comes cheap. The Democrats' proposal would cost the government $3 trillion over the next decade, while the pricetag on the Republicans' plan is $3.7 trillion.

Paul on Friday said that taxing the wealthy is an exercise in futility: They'll find a way around it.

"Do you remember when they wanted to tax the yachts — that we're going to tax these big boats that the rich people bought?" he asked. "Well, guess what? The rich people went to the Virgin Islands and bought their boats down there. But you know who was hurt? The ship builders in Connecticut."

Paul also argued that the GOP's newly unveiled "Pledge to America" was largely influenced by pressure from the Tea Party. 

"We are influencing, if not shaping, the entire debate right now across the country," Paul said. 

Still, he said the Pledge could have been "a little stronger." 

"I wanted them to have in there something like a balanced budget amendment because I think both sides of the aisle have proven themselves to be untrustworthy with balancing the budget," Paul said. "They'll only do it if they have a rule attached to the Constitution that says you have to balance the budget."


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