Right Change: Obama’s Buffett Rule Distraction
Wed, April 11, 2012Yesterday, President Obama pitched his proposal for Populism where he demanded higher taxes on all of the millionaires and billionaires by implementing his so called, “Buffett Tax.” Democrats have been pushing this tax for months in hopes it will ignite negativity against Republicans as it raises taxes for all millionaires and billionaires at 30%. Research shows us that Obama’s rhetoric about the Buffett tax is completely wrong, but it’s a huge distraction from Obama’s out of control spending.
"You might have heard of this, but Warren Buffett is paying a lower tax rate than his secretary. Now that's wrong. That's not fair and so we've got to choose which direction we want this country to go in," said Obama during the speech. "I've already told you where I stand, now it's time for members of Congress to tell you where they stand." Obama's "Buffett Rule" proposal would raise the effective tax rate for the wealthy on investment income to at least 30 percent.”
Before we got into the Buffett Rule distraction, let’s point out the fact that the rich do not pay lower average tax rates than average salary earners. See table from the Wall Street Journal below:
This tax increase Obama is proposing is on capital investment, which the U.S. taxes at 35%. Millionaires and Billionaires are paying double taxes, once at about 23.3%, then again at 35%. Their real capital gains tax rate is closer to 45%. Warren Buffet’s Secretary doesn’t pay a capital gains tax. Warren Buffett does.
Obama originally touted this Buffett tax as a means to lower the deficit. The White House has since retracted that notion saying this new tax rule is to emphasize “fairness” over deficit reduction:
“Introducing a minimum 30 percent income tax on millionaires “was never our plan to bring the deficit down and get the debt under control,” Jason Furman, the principal deputy director of the White House National Economic Council, told reporters on a conference call Monday afternoon. “This is not the president’s entire tax plan. We’re not trying to say this solves all our economic problems, all our budget problems.”
So if this won’t reduce our deficit or solve our economic and budget problems, why is it even in the conversation? Better yet, why is the Senate even expected to vote on this rule next week? It’s a political weapon. That’s all. This Buffett tax would generate $47 billion in revenue over 10 years. That would be a drop in the bucket of the over $7 trillion in federal budget deficits projected during that period. It is also minuscule compared to the many hundreds of billions it would cost to repeal the alternative minimum tax, which Obama's budget last month said he would replace with the Buffett rule tax. Obama could also tax every billionaire in America at a 100% rate and it still wouldn’t make a dent in the federal deficit. The federal government has overspent $15.6 trillion and President Obama is responsible for a little over $5 trillion of that. Generating $47 billion from this tax won’t do a thing for our deficit or our economy, most likely because these millionaires and billionaires will take their business overseas.
Obama loves to speak about fairness because people react positively to it. It’s only fair that these rich people pay more money because they don’t need it. We as a nation need to decide if that is the type of dictatorship we want to live under. If you think that the government should decide who deserves to keep their money, then Obama should be your vote in November 2012. The Buffett Tax is not only bad tax policy; it’s a distraction from Obama’s out-of-control spending.
If I have two jobs and two incomes I have to pay tax on both incomes. It is balony that the rich are paying tax twice. Just plain bull.
The Wealthy are already paying their fair share. Any more taxes and the economy will tank. Obama is the worst President ever and needs to be removed one way or the other.
I’m no expert, but there is no way millionaires and billionaires would take their money overseas, that makes no sense.. They are american citizens, no matter what, unless they renounce their citizenship, they have to pay american taxes. No matter where they make money. It is not BS to pay taxes twice, capital gains is the money made from investments, if the poorest person in the world sold 1 piece of stock, he’d be taxed on the profit. Only it’s way easier for the wealthy to make money from investments, because the risk is so much lower. If the stock goes down, they can hold on to it until it goes back up, they have plenty of reserves for necessities, however if the stock goes down for a poor person, they may need that money for school or to make a down payment on a home. Even if the wealthy ‘took their money overseas’ guess who replaces that vacuum? The middle class, and guess who gets the jobs they create? The middle class. Pretending like only the wealthy are able to create jobs is, at its core, a huge insult to the vast majority of American people. The poor? Yes, there is an educational gap that will most likely prevent them from creating businesses or making wise investments. But the middle class is the heart and soul of this country. The wealthy came, at some point, from the middle class.. And it was most likely some person who had the security, the means, the drive and the support to make an idea a reality, that turned into a business, that turned into a company, that turned into profits, that turned them into.. a wealthy individual. But to say or to do anything that would hamper or prevent other Americans from making that same transition? Absolutely ludicrous. Maybe that money won’t make a dent in our national debt dollar for dollar, but what if that money went toward individuals who might otherwise not be able to make that leap from lower to middle, or middle to upper, or upper to wealthy? What if that 47 billion birthed 1000 business that each made 1 billion? Now are we making a dent in our national debt? Yes. If they’re getting taxed on the profits..
That being said, it is pointless to be passing legislation that does nothing to fix the problem. Too bad those bills come from both parties.
What a load of crap.
Capital gains taxes are 15% and the author of this horrid misinformation peice acts like you just add the 30% right on top of your other taxes. That’s completely false.
If someone actually works to earn $1,000,000 a year (like an athlete or CEO), their rate is 35% for income over $388k and lesser % for the money under. If your AGI is exactly $1 million, your total income tax will be $326,760. Or about 32%.
If you are unemployed but have investments that earn you exactly $1,000,000 a year, your rate is 15% flat. So by sitting around doing nothing, you pay less than half as much in taxes as the person working for it. Somehow, Romney claims he paid “at least 13%” of his gross income so he basically admits he’s part of the problem.
That’s what the Buffet Rule addresses.
And even the quote from Furman doesn’t say it fixes nothing - he says it’s doesn’t fix everything. There’s a HUGE gap between nothing and everything. It’s part of the equation, but not the entire solution.
For being all about taxing the rich, this author needs some education on how tax brackets work. Or they know better and are hoping you don’t.
Lloy Myers I don’t believe you understand what’s going on. When these rich guys make money they are taxed then when they put that money in the bank they are taxed on it again it is at a lower rate but it is income on money they have already been taxed on. That is why you hear, things like oh the rich guy pays a lower tax rate than Sally who works for him. They pay one rate on earned money a lower rate on the interest on money they have already been taxed on. They were jumping up and down about Romney not paying a high rate well he wasn’t working he was living on the interest on money he had already paid tax on. SO it’s jut not being explained to people and they do it to get people pissed off at the rich.Shame shame shame
Either businesses create jobs or the government and we do not need anymore government expansion like the 20k the IRS will need to track adherence to the Affordable Help Care Plan. How will that be better for us to get medical care, increasing the size and overhead of government. Look at all the failures in government agencies. No, less taxes and let businesses create jobs and expand the tax base and start taxing all people with jobs to make them aware of what it is like to pay for government instead of living free off of the others. Romney paid more in taxes than the total of the lower 53% of people.
the worst ever the only one that spend 5 trillion in less then 4 yrs the first to get our AAA to AA plus the first to double people on food stamps.if you want to save the country you need to get this scum bag lying bastard s.o.b. out of office.
Lloyd, you are not paying two separate tax rates on those incomes. You pay one tax rate for each. People in the higher tax brackets that fall into the category of having to pay capital gains tax, are most definitely paying twice. Go reread the article.
Every time I hear the Democrates talk, i truely believe they are a Cancer on this Great nation, They talk about fair share what about the 48 % that pay no tax at all, or how much illegal alliens cost each state…..
none
I have commented on various post over time, and I usually do so when I have a bonified issue, or I find something interesting to throw out there for comment. I like to research and read a considerable amount of this and that from both political party supporters. I found one recently, and I bring it up, only because I have heard this a lot lately. That would be FactCheck.org. I first found it in many articles from CNN. Need I say more about that. After digging into FactCheck.Org., I discovered an interesting fact. It is part of a group known as the Annenberg Network which I discovered while reading a short biography on Barack Obama. The Annenberg Network is a liberal-left cause and organization, of which Obama served on the board of directors of the Chicago Annenberg Challenge from 1995–2002, as founding president and chairman of the board of directors from 1995–1999. How convenient is it, to be policed by your own group or organization, while belittling the opposition in what they consider a factual basis. This is true deception here! I wonder who all knows! Who’s policing Factcheck.org??
well the rich do think they are better then anybody else
Obama did not bring in many jobs in California and his ass MUST GO NOW!!!!!!!!!!!!!!!!!!
My biggest mistake in 2008 was avote for him, Now i will vote against him, worst man in oyr goverment to be president,WHO EVER HEARD OF A PRESIDENT KNEELING AN KISSSING THE HAND OF A DICTOR ,,,HE DI ugg vote hime out
We gave Obama a chance, but he failed, so if we fail at our jobs we get fired. Sounds like the only thing to do is give another person the job. Very simple.
I agree with Bruce, Obama is the worst President; He is a welcomed x-president by Carter who can now proudly say that: ‘I wasn’t the worst!!!’
The rich are paying enough, and it’s the rich that pay the poor, the rich that donate, the rich that purchase high dollar items and make this economy move, the rich who create jobs and have enough to pay people to work for them, AND THE RICH THAT ARE GOING TO JUST HIGH TAIL IT OUT OF HERE IF THEY ARE TAXED ANYMORE and thats what obama wants a poor and defenseless country where the rich are gone and we will be under his thumb and the government will rule us like communists, and we will have nothing to fight it with we will have to do what they say if we want to live, SO ITS UP TO YOU AMERICA, I DONT LOVE ROMNEY EITHER he is kinda fake and plasticy but OBAMA will weaken the hell out of us and leave this country sliding down the cliff
I worked 30 years for the rich and was giving a nice pension when I retired. Obama and his people have done more damage in four years than any other president in history including Carter. America please wake up.
I agree with Bruce and you are right it is in the bible about hire taxes will kill us all OBAMA NEEDS TO GO I just HOPE the rest well help put him out In MD we the people here are riding with big Romney signs in the back of a pick up trucks.. OBama is working for the Devil not God and Us..this rich are the ones who put the jobs out here for americans I think it should be the Wall Street and the Congress and etc to lose there pay for not cleaning up this mess for us.. we should be able to kick out all of them and we hire new. amen they are our employees that what they have forgotten!!!
OBAMA IS A LIAR and A POOR HUMAN BEING.
The rich, including Buffet, and people like Gates contibute millions every year to charities that acutally help people in less fortunate circumstances than themselves. So, are we to tax them more so that they pay more to the government, who wastes the money, or leave them alone so that the money goes to charities that actually help people?????
It’s about time the 1% have our own website where we can express our greed openly without having to bother with all that middle class working American garp. Sure we have a lot of money, but until we get all of it, there’s more work to do! Mitt Rmoney 2012!
More tax = millionaires and billionaires will take their business overseas.
Warren said he would like to pay more taxes. What is stopping him? Just make out a check to the U.S. Treasury and they will be happy to take it. Don’t be sad any more Warren! PS My husband lost his job under this president so if you could spare any extra cash we sure could use it. No retirement for us!
Am I the only one who finds it unjust—and apparently unconstitutional—to tax different people at different rates?
Facts are facts, and heres a fact folks on the left know, but won’t say out loud, but get this through your working class mind folks….rich people will be rich in spite of anything we do, and thats a good thing, cause I want to be rich one day. Reagan cut taxes, and yet the rich paid more in real dollars, why do you think that is? Because he also eliminated alot of tax havens…..so when Bush and Clinton came along and raised em again, what did democrats AND republicans do to get that through….well they created more tax havens for the rich….so they ALWAYS end up paying less in actual dollars than they were,,,,they just ship the cash into the havens and create nothing with it till taxes come down or they retire to a place where they pay less….thats life for the rich, get over it. They are no more greedy than the guy or gal that thinks thier food should be paid for cause they spent more than they earned and lost a job without saving, or their abortion or baby pills should be paid for cause they want to party and screw with no concequences, or thier college paid for cause they should be able to party like rock stars instead of working through school and going to one they can afford,,,or god forbid serve in the military….why should they be expected to something when they can get something for nothing….nah….there is plenty of greed in this country….rich and poor.
As far as the rich on the left, if they feel they dont pay enough, its a free country and the US govt will take it if they want to give it, nothing illegal about overpaying taxes. But I am sure if I had Buffets dollars I would be able to set up trust that do things better than goverment ever could such as aiding the poor through food pantries, assisting the poor with aid for medical bills….the things foundations are set up for. So when you hear a guy like him say what he does about being able to pay more, you have to wonder why he don’t
Obama is the worst president we have ever had.And when he started to trample all over the Constitution he should have been removed from office right then and their..
Looks like the repuglipigs have more ti e to spread lies, does Paul Ryan write your crap?
One thing no one has explained to me is why the law applies to different people differently, with some paying at a higher rate than others, and some being completely exempt.
Aren’t the laws supposed to be applied to all people equally? I’m told that’s what the 14th Amendment is all about.
I have been denied for financial aid because I am married and my husband makes a decent amount of money. If I was a single mother I was told I would be qualify for the aid. Now that’s some bull. Here I am a typical American that got married at a young age of 22 and now trying to finish her education at the age of 36. This has really opened my eyes that I can’t even get help. My husband and I are in debt up to our ears and they don’t even take that into consideration. Yes, we have one Child that we need to support along with making sure we live in a decent area. I am truly disappoint with Obama saying he’s helped people with their education. We’ll Obama you didn;t help this Momma with there education.
That’s why I won’t be voting for you!
Obama wants America to become a socialist country….This is an angry Black man…I am not a bigot but Obama is….
Obama is in the People’s House and everything is paid for his family by the people. He is worth millions now that becaues of capitalism was able to sell his book and make the millions. He demonizes people who better themselves and believes their money is his to spend. He is a marxist. He just wants redistribution. Why would anyone want to go to college to better themselves if he’s just going to take it away. He is about control of our lives and has already started with the healthcare law he shoved down our throats. If he wins his father’s dream will come true and that is the destruction of the best nation in the world including our military. He wants us to be a third world country and he wants to be the dictator. He’s already started by not going thru Congress and rejecting the laws of the land. Vote him out before his father’s dream are real.
Sales and corporation tax rates should be based on the amount of welfare and other necessary government-paid programs because of low wages, disability, and lack of employment with rewards for employers who meet certain criteria to insure the good health and productivity of its people.
This is One Country Under God, not One Country Under the President.
According to the unanimous decision in U.S. v CRYER earnings are not income subject to tax. He has a website at www.truthattack.org that explains how he took on the IRS and used federal court precedent, and the Constitution to show that earnings were never supposed to be income subject to tax.
As for 0bama, he’s a post turtle. He didn’t get there by himself, is useless while he is there and someone should take him off the post
warren buffet is getting something really big out of this…
Obama is comfortable lying to us. We believed him 4 years ago so he is safe telling anything he wants. Romney is not lying because he is a man of intergity and WANTS the JOB of bringing america out of this Obamamess.
Obama is all about class warfare. That is how the Dumbocrats build their base with the politically ignorant masses and minorities and people who expect something for nothing. All this will accomplish will be to keep the economy slowed. Think people, have any of you idiots ever worked for a poor man, when the rich get richer, all us pee ons do better, the economy picks up, they spend money buying things all of us build and work on, service industries get more work. The real agenda should be to lower business tax rates, keep businesses here in America, tax the foreign companies so ours can compete, and implement a fair tax system based on sales tax. That would collect more money and help the poor. Only new items would be taxed, nothing used. That DUMB guy George Bush tried to get that going but the ignorant ass Dumbocrats fought him on everything, along with tort reform, medicare and social security reform. The Dems want all of you people dependant upon them and the government, then they can really run every aspect of our lives. At least half of all Americans have proven that they are too stupid to vote.
There’s a flaw here - Obama proposes no taxes on investment, but rather on income. The exact amount would be subject to intense negotiation, of course.
Now the Nurses, they think we need a financial transaction tax (FTT, also known as Robin Hood tax since it returns money very indirectly to victims of the Wall Street crash.)
None of this is paying twice, or double taxes, it’s just taxing income.
Get over it. Polls show voters have realized in increasing numbers that the GOP is deliberately stalling economic recovery for their own poltical gain. We’re mad as hell, and we’re not going to take it any more.
Take such inane theories and lies back to Kansas.
this bullsh.t has got change
everything about oboma is a fraud
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