Comment by Jim Campbell
In 2010 I wrote the following article while writing for the Examiner,
This was written as he began to flap his jaws about the rich not paying enough. Rather an odd stance for a chap whose companies are tied up with the IRS over tax issues. Come on Warren, just get out the check book and write a big one. Walk the talk or put a muzzle on it. Your plan was a joke anyway.
Warren Buffett and President Obama claim that the rich do not pay enough taxes. They both blame the American tax code of being unfair and coddling the rich. Both have been pushing the same class-warfare narrative for many years, using current US capital gains and dividends taxation rates as evidence for their big government progressive agenda. Both are spreading misinformation about all the taxes corporations and individuals actually pay.
Top 10% of Taxpayers Pay 70% of All Taxes
The latest research on US income taxes data (conducted by several non-partisan and independent organizations) shows that, on average, the top 10% of taxpayers pay approximately 70% of all federal taxes in America. Does “fair” mean they should be paying 80%, 90%, or 100% of all taxes instead? Is that the definition of “fair share” that both Obama and Buffet would be more comfortable and happy with? I think Karl Marx and Friedrich Engels would definitely have approved.
This is the situation all of us Americans face come December 31, 2012. It doesn’t make for a very Happy New Year — does it?
The solution that President Barack Obama and the Senate Democrats have is to just raise the upper tax brackets for those with income levels of $200,000 (Single) and $250,000 (Married). Not only does that adversely affect small business owners, it yields additional tax revenue of only $85 billion per year. Given the insatiable spending appetite of the Federal Government, that $85 billion only funds the Federal Government for barely 10 days!
What an insidious political gimmick — just like the “Buffet Rule” which was an even bigger joke in that it only yielded $40 billion in revenue over 10 years.
Another tax set to increase is the dividend tax which rises from 15% to a top level of 43.4% — and many of our seniors depend upon dividend income to survive.
Another tax which I have not mentioned is the infamous “death tax,” currently at a 35% rate but will increase to a 55% rate, as well as the minimum exemption reduced from $5 million to $1 million.
Lastly, we have the highest corporate/business tax rate in the WORLD, at 39.6%. We are basically telling the private sector that America is not open for business and forcing it out.
Next week we shall hit $16 trillion in debt, but when you factor in our unfunded mandates and liabilities, our debt is far higher. As the CBO stated this week, we are about to hit our fourth straight year of a trillion-dollar-plus deficit. The three previous were $1.42 trillion, $1.29 trillion, and $1.3 trillion, with this year, estimated to be $1.1 trillion.
Now, if all these tax increases were to aid in debt and deficit reduction, perhaps they might be carefully considered, but they are not. In President Barack Obama’s Fiscal Year 2013 budget (which failed both Houses of the United States Congress without garnering one vote), there is $1.9 trillion in new taxes or as this Administration likes to say “revenues.”
The nasty little secret is that Obama’s budget NEVER balances and all you get is a 53% increase in the growth of Federal Government — so much for a “balanced” approach.
Consider, at the same time in President Ronald Reagan’s first term, we were at 7.1% GDP growth.
Under President Obama you ask? A whopping 1.5% GDP growth.
The Keynesian economic theory of tax and spend to resolve a fiscal crisis does not work. Continued government “stimulus” spending does not work either – just ask Japan.
What does work?
- Move from a progressive tax code system to a flat tax system and compress the six tax brackets into two: 25% and 10%. Then reduce the amount of personal deductions and exemptions to basically three: mortgage interest tax deduction, charitable contributions, and child tax credit.
- Keep Capital Gains taxes at 15% or maybe even lower to 10% in order to spur on investment, innovation, ingenuity, and economic growth.
- Eliminate dividends taxes and take the boot off our seniors.
- Eliminate the Death Tax so we can pass on to future generations thriving businesses and capital for growth.
- Allow a onetime repatriation of the trillions of dollars of capital offshore in order to ignite production, manufacturing, and job growth in America.
- Reduce our corporate/business tax rate to somewhere between 22%-25% and eliminate the requisite exemptions to maintain the lower rate.
Just imagine a President taking the podium and announcing these necessary comprehensive tax reforms… The certainty and predictability it would provide to our private sector would be immense, and one can only imagine the immediate change in our economic growth — in a positive direction.
Avoiding the “fiscal cliff” we are facing is critical if we want to restore the dream of economic freedom and opportunity for all.
We can turn the American economic ship of state around and set sail toward a bright horizon filled with Fair Winds and Following Seas. It just takes leadership.
Steadfast and Loyal,