Let’s talk about numbers. People love to make numbers say whatever they want. For example, number trickery has perpetuated the myth that the middle class pays the majority of the taxes in America. Famed fat cat billionaire Warren Buffett has made issue of the effective tax rate of his secretary, and how so totally unfair it is that she is taxed at a higher percentage rate than him.
Numbers, especially when using statistics, can be twisted to say many things that don’t fall into the category of Common Sense. For example, statistically speaking, if I have five children, one of them will be Chinese.
Here’s a pesky fact -- the 10% of households with the highest incomes pay more than half of all federal taxes. They pay over 70% of federal income taxes, according to the Congressional Budget Office. How is it possible that the middle class pays the most in taxes when as a group, they pay less than half?
Anyway, in order to save the secretaries (or something), President Obama has been touting the Buffett Rule, which would impose a minimum tax on the nation’s 400 highest earners. Apparently you can earn enough money.
As I pointed out last week:
Super rich people make money from capital gains and dividends, which they then turn around and reinvest into the economy. Raising taxes on capital gains means that rich people employers won’t be able to create jobs.
Sixty percent of the public supports a minimum tax on the uber wealthy, because hey, why not? They already have enough money; it’s time for them to spread it around to those of us struggling to make ends meet. Besides, President Obama said that this would go a long way toward eliminating the national deficit and reducing our debt.
Side note: Any billionaire that wants to voluntarily pay more taxes by donating to the government to reduce our debt (it’s patriotic!) can go here and do it right over the internet!
Back to the magic Buffett rule that will solve our nations financial problems … Last September, President Obama said:
What I’ve said is this is a very simple principle that everybody should understand: Warren Buffett’s secretary shouldn’t pay a lower [sic] tax rate than Warren Buffett. A teacher making $50,000 a year, or a firefighter making $50,000 a year or $60,000, shouldn’t be paying a higher tax rate than somebody making $50 million a year. And that basic principle of fairness, if applied to our tax code, could raise enough money that not only do we pay for our jobs bill, but we also stabilize our debt and deficits for the next decade. And as I said when I made the announcement, this is not politics; this is math. (Laughter.)
Math? That’s some interesting math. As my friend Jimmie Bise points out:
The American Jobs Act, the bill to which the President referred in his speech, clocked in at $447 billion dollars. The Buffett Rule was predicted to bring in, at best, $114 billion, not in one year, but in ten. By my count, the President would need almost 4 Buffett Rules — or four times as many Evil Bazillionaires — to cover just his jobs bill if we assume that his plan stretched out over ten years, which it didn’t. We haven’t even gotten to the part where this miracle plan of his stabilizes the debt for ten years. How many more monocle-wearing, puppy-blending, orphan-kicking rich people would we need to get to that point? Hundreds? Thousands?
The Buffett Rule has nothing to do with cutting spending, reducing the deficit or debt, creating jobs, or anything else that the Obama administration claims it will do. This is a distraction, something to cover up the fact that Obama can’t even get Nancy Pelosi to vote for his budget, or that unemployment numbers are going down because people have simply given up looking for work.
Nope, the Buffett Rule is a distraction. It is smoke and mirrors, an attempt to blame the financially successful people for stealing the nation’s wealth and a way to reintroduce class warfare. Newsflash: Rich people get rich by creating a product or service that entices people to fork over their cash in exchange for it. If you don’t want the Steve Jobs of the world to be rich, I’d suggest not buying things like iPads.
Image via John-Morgan/Flickr