President Obama and Democrats are going to get their tax increases. Does anyone doubt that? They hold all the cards in this game.

Will those increases work as they anticipate? Not a chance, but Democrats seem ever hopeful in their fantasies of a big government powered utopia. Yet Democrats stubbornly believe that abolishing Bush-era cuts and restoring the top Clinton-era rate of 39.6% will fix the nation’s many ills, returning us to Clinton-era prosperity.

There are several reasons why those tax hikes, at best, will do no good at all. The most obvious reason can be spelled out by asking the simple question, what is 39.6% of nothing?

If companies are dodging taxes, as Democrats claim, through loopholes or by moving overseas, how will tax hikes fix that problem? In actuality, tax hikes will make those problems worse, not better. As Bloomberg noted yesterday

Google Inc. (GOOG) avoided about $2 billion in worldwide income taxes in 2011 by shifting $9.8 billion in revenues into a Bermuda shell company, almost double the total from three years before, filings show.

By legally funneling profits from overseas subsidiaries into Bermuda, which doesn’t have a corporate income tax, Google cut its overall tax rate almost in half. The amount moved to Bermuda is equivalent to about 80 percent of Google’s total pretax profit in 2011.

Google is not alone in this, but they are worth noting because of the ardent support given by Google founders to the Obama Administration. It shows a willingness by the administration to look the other way where friends and supporters are concerned while attacking opponents. It shows, in other words, an administration which is inconsistent at best.

No surprise for Obama critics.