By Rebekah Rast
Nothing like a little tax question from the president to get you ready for April 17:
“When it comes to paying down the deficit and investing in our
future, should we ask middle class Americans to pay even more at a time
when their budgets are already stretched to the breaking point? Or,
should we ask some of the wealthiest Americans to pay their fair share?”
President Obama said in his weekly address.
Interesting how the only option is an either or. Tax one group or tax the other — take your pick.
Obviously, the president would like to tax the “rich,” using his
favorite model provided by billionaire investor Warren Buffett. Under
the Buffett rule everyone making more than $1 million will pay at least
30 percent of their income in taxes — whether it comes from income or
investment.
According to the Huffington Post,
Congress’ Joint Committee on Taxation estimated that if the Buffett
rule is enacted, it would only collect $47 billion through 2022 — a drop
in the bucket compared with the
$7 trillion in federal budget deficits projected during that period.
Where are the trillions of other dollars going to come from to pay down the deficit, Mr. President?
You see, even if Obama got everything he wanted, no strings attached,
it wouldn’t help bring down the deficit. Taking more from one group to
use on another is nothing but the redistribution of wealth. It does
not create new wealth and will not get America a balanced budget.
In fact, a likely scenario if the Buffett rule was enacted would be
to see the country go from bad to worse — further troubling the fiscal
crisis facing America.
The wealthy in this country usually invest their earnings. They
invest their wealth so it grows, but their investment also provides
capital for the growth of businesses, small and large alike. If
suddenly both investment and regular income are taxed at a much higher
rate, less money will become available for American businesses.
Even
The Christian Science Monitor explains that this rule sounds good in theory, but won’t work in practice:
“The Buffett rule sounds good in
principle. High-income taxpayers should pay at least as large a share of
their income in taxes as the rest of us. But most already do. On
average, middle-income households will pay 2015 taxes totaling about 15
percent of their income (using the legislation’s definition). Without
the Buffett rule, more than 99 percent of millionaires will pay more
than that and only about 4,000 will pay less. Barely 10 percent of them
will pay less than 20 percent. The proposed legislation would certainly
raise taxes on a lot of high-income taxpayers. But the price would be
even more complicated tax code.”
Even those media outlets that typically support the president can’t get all the way behind this plan. Nevertheless,
the plan is scheduled for a vote in the Senate on April 16.
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