Earlier this week President Obama justified his raising taxes on the wealthy by claiming that all tax payers need to pay their fair share, saying “It is wrong that in the United States of America, a teacher or a nurse or a construction worker who earns $50,000 should pay higher tax rates than somebody pulling in $50 million.” Polls show that many support raising taxes on those with higher incomes and how could the Republicans politically afford to vote against a jobs plan?
Well the truth is much more uncomfortable for the President. Sure, Warren Buffet may pay a smaller percentage of his income in taxes than his secretary. But this is simply an anecdote, albeit a politically useful one, and tax policy should not be based on anecdotes. Seriously. As much as the President likes to parade the “Buffet Rule”, reality says that the average effective tax rate for those like Mr. Buffet who make more than a million dollars a year is 29.1% while those in his secretary’s bracket pay around 15%. So not only is Buffet the exception, he is quite the exception.
But disregarding reality for a moment, the GOP is still left in the unenviable position of defending the rich in a bad economy. If Obama makes a strong argument that raising taxes on the wealthy few will not hurt the economy then he can force the Republicans to either pass the plan or commit political suicide, right? That would be true, if he was not on the record saying that raising taxes will hurt the economy by “sucking up demand.” So now he has boxed himself into arguing for raising taxes that will hurt the economy to pay for a spending bill that will help the economy so that he can then cut spending (which many on the left say will hurt the economy) so the debt doesn’t destroy the economy. Good luck.
Posted By Max Viscio