Motley Moose – Archive

Since 2008 – Progress Through Politics

Millionaire's Tax: A No Brainer?

It’s amazing that there’s pushback on raising taxes on the wealthy from anyone other than the rich, but there always will be, so long as the GOP can convince the middle and lower class rank’n’file that placing higher taxes on the rich is socialism or deadly to the economy. Sometimes phrasing matters, and it’s important to note that Republicans seem to have an advantage when it comes to controlling the narrative. I’ve never been sure exactly why this is: do we just not fight back hard enough, or is the reach of Fox “News” really that broad? My guess is that it’s a combination of factors.

Just seems to me like a pretty raw deal for most of the country when the wealthy don’t even have to pay their fair share.

It really bugs me, also, when supposedly non-partisan entities play into the GOP’s hands. As far as I’m concerned, once the GOP gains “control” of a phrase and spins it to the most negative associations possible, it’s time for everyone else (who doesn’t have a vested interest in seeing the GOP in power) to either 1) take back control of that phrase, or 2) stop bloody using it at all. There are a million ways to manipulate statistics – and plenty of ways to skew polls, even unintentionally. I look at a result like this:

…and I can’t helping thinking, “Well, DUH.”

Results like that seem pretty clear cut, and they can then be used by Republicans, who say that that at least half of the American public (mostly “average Joes,” in fact) does not want the rich to pay higher taxes. But as far as I’m concerned, a lot of the problem is in the phrasing: “redistribute the wealth.” It’s become a dog-whistle phrase that raises red flags and sets off alarm bells in people’s head because it is now considered “code” for socialism. We need to either fix that or stop saying it. If Gallup rephrased that poll question into, “Should the very rich pay higher taxes since they’ve benefitted the most from all this county has to offer?” then I’m pretty sure results would be different.

But sure, there are plenty of people in this country who will oppose tax increases on anyone, no matter what, under any and all circumstances. So it will be interesting to watch the pushback on this, a commonsense – and much milder measure than actually “redistributing the wealth” – which will nevertheless enrage a large segment of the population:

WASHINGTON – President Obama on Monday will call for a new minimum tax rate for individuals making more than $1 million a year to ensure that they pay at least the same percentage of their earnings as middle-income taxpayers, according to administration officials.

[. . .]

Mr. Obama, in a bit of political salesmanship, will call his proposal the “Buffett Rule,” in a reference to Warren E. Buffett, the billionaire investor who has complained repeatedly that the richest Americans generally pay a smaller share of their income in federal taxes than do middle-income workers, because investment gains are taxed at a lower rate than wages.

Mr. Obama will not specify a rate or other details, and it is unclear how much revenue his plan would raise. But his idea of a millionaires’ minimum tax will be prominent in the broad plan for long-term deficit reduction that he will outline at the White House on Monday.

New York Times: “Obama Tax Plan Would Ask More of Millionaires”

Boehner has already come forth to say that while, yes, there should be tax reform… no, tax increases are not a “viable” option.

…Wait, what?

In his speech yesterday, per the New York Times, House Speaker John Boehner “rejected tax increases as part of a sweeping effort to reduce the nation’s debt, delivering his prescription for a Congressional deficit-cutting committee ahead of a competing presentation by President Obama early next week. Mr. Boehner urged the new bipartisan committee to focus on cuts in federal spending and entitlement programs as a way of slowing the growth of government. He said tax increases should be ‘off the table’ as the committee works toward a late-November deadline.”

But: “Boehner said that the committee’s efforts should include proposals to close tax loopholes as part of a broader overhaul that lowers personal and business tax rates… ‘Yes, tax reform should include closing loopholes,’ he said. ‘Not for purposes of bringing more money to the government. But because it’s the right thing to do.'”

MSNBC: “Boehner: Read My Lips – No Tax Increases”

Oh, I see. Wants to close a few loopholes. But of course, no new taxes.

I still don’t understand why what was good enough for Saint Ronnie isn’t good enough for today’s GOP. Just for the heckuvit, a reminder:

Reagan was a serial tax raiser. As governor of California, Reagan “signed into law the largest tax increase in the history of any state up till then.” Meanwhile, state spending nearly doubled. As president, Reagan “raised taxes in seven of his eight years in office,” including four times in just two years. As former GOP Senator Alan Simpson, who called Reagan “a dear friend,” told NPR, “Ronald Reagan raised taxes 11 times in his administration – I was there.” “Reagan was never afraid to raise taxes,” said historian Douglas Brinkley, who edited Reagan’s memoir. Reagan the anti-tax zealot is “false mythology,” Brinkley said.

Think Progress: “10 Things Conservatives Don’t Want You to Know About Ronald Reagan” (original emphasis)

Facts are a funny thing, huh?

I have to admit, though, I’ve got the jitters about some of the administration’s ideas to reduce the deficit. Maybe that’s because I’m still not entirely clear on what they are.

WASHINGTON – As Congress opens a politically charged exploration of ways to pare the deficit, President Obama is expected to seek hundreds of billions of dollars in savings in Medicare and Medicaid, delighting Republicans and dismaying many Democrats who fear that his proposals will become a starting point for bigger cuts in the popular health programs.

The president made clear his intentions in his speech to a joint session of Congress last week when, setting forth a plan to create jobs and revive the economy, he said he disagreed with members of his party “who don’t think we should make any changes at all to Medicare and Medicaid.”

Few Democrats fit that description. But many say that if, as expected, Mr. Obama next week proposes $300 billion to $500 billion of savings over 10 years in entitlement programs, he will provide political cover for a new bipartisan Congressional committee to cut just as much or more.

New York Times: “Democrats See Perils on Path to Health Cuts”

But the tax thing? That I can definitely get behind. I really enjoyed Warren Buffet’s Op-Ed piece in the Times last month. For those of you who haven’t read it, you should give it a look. Lots of good information and insight.

Our leaders have asked for “shared sacrifice.” But when they did the asking, they spared me. I checked with my mega-rich friends to learn what pain they were expecting. They, too, were left untouched.

While the poor and middle class fight for us in Afghanistan, and while most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks. Some of us are investment managers who earn billions from our daily labors but are allowed to classify our income as “carried interest,” thereby getting a bargain 15 percent tax rate. Others own stock index futures for 10 minutes and have 60 percent of their gain taxed at 15 percent, as if they’d been long-term investors.

These and other blessings are showered upon us by legislators in Washington who feel compelled to protect us, much as if we were spotted owls or some other endangered species. It’s nice to have friends in high places.

New York Times: “Stop Coddling the Super-Rich”

And I like the “Buffet Rule” – it’ll make things easier on future high school students who have to remember it for their exams. Poor kids. Already they have 8-10 more years of history to rote memorize for their tests than I did in high school.

But enough of my opinion? What do moose, old and new, have to say about all this?

Run with it.


53 comments

  1. Moozmuse

    One of my biggest criticisms of the administration is that their messaging/marketing has been incredibly bad. No one in his or her right mind should object to the rich paying their fair share, but the Repubs have mastered the Art of Messaging for a long time, and as much as we gnash our teeth and howl about it, nothing is going to change unless the Democrats start improving their game. I am just astounded – and disgusted – that they still haven’t gotten this fairly straightforward fact right. WHY NOT? I really really don’t get it. There has been a glimmer of hope lately, with the naming of the “Jobs Act” – hooray, it’s about effin’ time. The Buffett Rule is good, too. It’s a start, but the Democrats need to be much more aggressive and on point with this. I don’t know who’s in charge at the White House Communications Dept, but that person should have been fired long ago for incompetence.

  2. DeniseVelez

    will remember it.  Obviously it isn’t enough – but it’s a shrewd way to stick it into the craw of Republicans.

  3. bubbanomics

    tax the rich: that’s where the money is.

    Lest you take my snarkasm as criticism, let me say I’m all for this.  Buffett is 100% correct: the tax code coddles the rich through preferred treatment of investment income vs. salary income.  Economists love to discuss manipulating human behavior through the tax code.  The current tax code essentially rewards hoarding a massive amount of money if you can get it.  

  4. tardis10

    FauxNu hot button possible. “Some people” (OTHERS but not you) think “our government” (vast force for evil but paradoxically utterly inefficient wankers)should “redistribute wealth” (Marx barks)”heavy taxes” (outrage,how unfair) on the “rich” (vague and undefined,how dreamy) … an aside,I don’t think most Americans actually believe that they will someday become rich,but in absence of any other attainable fantasy,pretending so will do. Nonetheless,the poll votes were near tied. Mainstreet gets it.

    But will the GOPasaurs pass this? Doubtful. You’re right that Dem messaging should be simple (simplistic) and united. “Millionaires should be taxed just like all of us hard-working Americans are. Even Warren Buffet thinks so.” Not much more explicative than that.Over and over.  

  5. creamer

    The GOP loves to accuse us of class warfare whenever we point out the disparities in income and wealth in this country. It seems to me we should embrace it.

       At some point you have to start banging the drum. The conservative movment did this for decades before getting any results at the ballot box. Even if we dont get results quickly, we have to start changing the mindset of the “bootstrap” crowd that believe its a level playing field. Our schooling is tilted for the well off, our political system is dominated by the wealthy. Our schools don’t even aknowledge that we live in a society made of different class’s of people with different levels of opportunity.  

  6. Shaun Appleby

    We’re clearly going to be in for some rough weather:


    WASHINGTON — Rep. Paul Ryan (R-Wis.) said on Sunday that House Republicans would oppose President Barack Obama’s payroll tax cuts for both employers and employees, arguing that the policy had already failed to provide a sufficient boost to the economy. “It hasn’t worked,” Ryan said, suggesting the current temporary tax cut should be allowed to expire, which will amount to a 50 percent tax hike on workers making less than $106,000 per year.

    He also said he opposes the president’s proposal to require millionaires to pay the same tax rate as the middle class, known as the Buffett plan. “Class warfare might make for good politics, but it makes for rotten economics,” Ryan said.

    Ryan Grim – Paul Ryan, Herman Cain Push For Tax Increases On Middle Class Huffington Post 18 Sep 11

    Class warfare?  You ain’t seen nuthin’ yet.

  7. Strummerson

    against taxing the ultra-rich.  

    One poses as pragmatic economics.  This is the ‘government is wasteful and inefficient and the wealthy are job creators’ argument.  Basically, it stands on two premises:

    1) When the government takes money from the rich, they cease to invest.

    2) The wealthy, motivated by the profit motive, spend their money in more economically sound (read stimulative) fashion than the inefficient wasteful government.

    Both of these can be readily countered with historical arguments.  When the government lowers taxes on the rich to historic levels and the economy flounders, they go into hoarding mode.  Secondly, government investment in infrastructure and in the health and education of impoverished communities ultimately benefits the economy, especially those who hold the majority of the wealth.

    We might consider how to work with these premises more effectively, crafting tax policy to incentivize investment and penalize hoarding (thought not middle class savings).  If we don’t want to tax those whom we want to be investing in the economy because it will impede the flow of capital, then fine.  But if they sit on their savings, they rates on those sums go up…way up.

    The problem is the pivot to the second argument against taxing the wealthy, which is a populist moralist discourse.  This is the “class warfare” argument that stresses how the majority of tax revenues already come from the wealthy and compares taxes to government theft.  Of course, the government is responsible for the whole system and the rise in income inequality is becoming unsustainable.  Greed is killing the golden goose.  

    But I fear that this area of debate is a loser.  This is where Americans are encouraged by right wing populists to identify not with the society as a whole, or with the class to which they currently belong, but with that to which they aspire and with a fantasy of equality that is distinctly NOT egalitarian.  Since I am the equal of Buffet, Gates, Soros, the Kochs, Forbes et al, taking their money is the same as taking mine.  It’s immoral and threatens MY economic liberty.  Now, we know that it doesn’t.  NOT taking more of their money to sustain the system and facilitate participation in the system threatens the economic liberty of the middle class.  And remember, the poor don’t have economic liberty.  No one is less free than an impoverished family.  Arguing otherwise is the proverbial “let ’em eat cake” argument.  Nonetheless, refuting this argument requires such a cultural sea-change that it is doomed to fail.  Most people prefer the self-aggrandizing delusion that we are all Steinbrenners (notice no one ever complains that the owners are overpaid in baseball?) at least morally and in potential.

    It really seems to me that we’ve got to resist all efforts to argue on the grounds of fairness and morality and argue on the basis of economics.  We can make the moral argument through these debates.  But we’ve got to foreground pragmatic economics and even consider ways to craft policy to reflect that more explicitly, even at the risk of accepting the “job creators” premise.  

    Finally, to historicize this, the second argument actually extends back to the foundation of the republic, to the conflicting visions of Hamilton (urban banker) and Jefferson (rural libertarian planter).  For a great and quick explanation, see Chris Ladd’s piece on frumforum (http://www.frumforum.com/its-hamilton-vs-jefferson-all-over-again).  Of course, what he doesn’t quite get to is the simple fact that Jefferson may have had a point 200 years ago, but we have developed into a society that resembles Hamilton’s vision.  Our economy, and our position on the world stage, cannot thrive according to Jeffersonian principles.  We are driven by urban capitalist institutions, not the prosperity of independent rural (slave owning) communities for whom cities are necessary evils justified primarily in their position as markets for rural goods. Every time any right wing populist panders to small town America as the authentic America, every time we employ the term “heartland” we validate a Jeffersonian perspective that doesn’t conform to contemporary reality, that is not only conservative but fatally out of date.

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