The “Warren Buffet Tax “? The premise is false
President Obama has claimed that the “rich” aren’t paying “their fair share” and he likes to use Warren Buffet’s claim that Buffet pays less in income taxes than his secretary to infer that Buffet’s situation is the norm among our wealthier citizens.
Well it isn’t. And, in fact, any number of news organizations have pointed that out today.
President Barack Obama makes it sound as if there are millionaires all over America paying taxes at lower rates than their secretaries. . . . The data tell a different story. On average, the wealthiest people in America pay a lot more taxes than the middle class or the poor, according to private and government data. They pay at a higher rate, and as a group, they contribute a much larger share of the overall taxes collected by the federal government.
Treasury Secretary Geithner yesterday declined to answer a key question about the president’s proposed ‘Buffett Rule’: How many millionaires and billionaires pay lower tax rates than middle-income families? The answer appears to be this: not many. The nonpartisan Tax Policy Center has crunched the numbers and found that Warren Buffett and his secretary are the exception to the rule. For the most part, the wealthy pay a significantly higher percentage of their income in taxes than middle-income workers.
There’s one small problem: The entire Buffett Rule premise is false . . . . [N]early all millionaires still paid a rate that is more than twice the 8.9% average rate paid by those earning between $50,000 and $100,000, and more than three times the 7.2% average rate paid by those earning less than $50,000. The larger point is that the claim that CEOs are routinely paying lower tax rates than their secretaries is Omaha hokum.
And the WSJ calls it what it really is:
We rehearse all of this because it shows that the real point of Mr. Obama’s Buffett Rule and his latest deficit proposal isn’t tax justice or good tax policy. It is all about re-election politics.
[W]ith some 14 months until Election Day 2012, Obama’s speech yesterday essentially marked the end of the governing season and the beginning of the campaign. White House Communications Director Dan Pfeiffer admitted as much to the New York Times. ‘The popular narrative is that we sought compromise in a quixotic quest for independent votes. We sought out compromise because a failure to get funding of the government last spring and then an extension of the debt ceiling in August would have been very bad for the economy and for the country.’ Pfeiffer added, ‘We were in a position of legislative compromise by necessity. That phase is behind us.
If there is any transparency at all to this administration, it is this – their every move is obvious and it is clear this is being pushed out there for political reasons, not reasons having to do with what is best for the country.