The Columbus Dispatch editorialized today, condemning Barack Obama for promoting "class warfare" in his State of the Union speech when he again mentioned the fact that Warren Buffett's secretary is taxed at a higher effective rate than Buffett himself.
The Dispatch wanted me to know that this is not always the case, that most multi-millionaires and billionaires pay a higher effective rate than you or I. (Boy, I feel better already!)
The income taxes we pay are a result of the amount of money we make (higher incomes pay higher rates), how we make it (investment income is taxed at 15%, ordinary income anywhere from 10% to 35%), and our ability to reduce our taxable income via deductions, shelters, and credits (mortgage interest, contributions to IRA's, health savings accounts, charities, etc.).
Yes, the well-to-do generally pay more than lower income people (and they should), but not always. Lots of investment income and lots of write-offs can turn the tables, as in the case of Buffett. And in the case of Mitt Romney, whose recently-released tax return shows him paying just 14%. And there are many, many people making a hell of a lot less than Mitt paying a higher percentage than he is because theirs is ordinary income and they don't have shitloads of deductions.
Buffett calls such a situation crazy. He thinks it should be changed. Romney calls it the American way. He likes it just the way it is.
Obama sides with Buffett, and calls for change. And he continues to call for the expiration of George W. Bush's supposedly temporary tax cuts, at least on the top bracket (which should be back at 39%, not 35%). Dubya's supply-side, trickle-down magic tax cut didn't work, and combined with his two wars, it sent the deficit sky-high. This is what got us on the tax topic to begin with! A return to pre-Bush rates would provide a ton of helpful deficit-reducing revenue. But every time you mention it, Boehner, Cantor and McConnell pitch an absolute hissy-fit and threaten to shut down the government. Brilliant!
In his SOTU speech, Obama said that billionaires paying taxes equal to their secretaries is what "most Americans would call common sense."
The Dispatch editor disagrees, and claims Obama is being "deliberately misleading about the tax code, with the hope of stirring up resentment among voters."
Buster says if anyone's trading in misleading resentment, it's the D'Bag Dispatch.
Buster, Warren, and Obama need to drop the secretary vs the rich thing. It is truly an absurd attempt to mislead the ignorant while promoting higher taxes ON ALL who pay long term capital gains taxes. But hey, it will get Obama some praise and most of the media does not have time to explain the whole story. When Buster downsizes from that big suburban house to a smaller Florida condo does he want to pay 15% on the long term capital gain from the big house sale? Apparently not because that is unfair to the poor and downtrodden and he would rather pay 35%. Yes, Mr and Mrs Buster worked hard making regular income and paying the higher 28 to 35% tax rate on that income while paying for the house over 30 years but now you want to pay 35% AGAIN. Even though much of the capital gain income from the house sale has been eaten up by higher costs of living. Doggone it, the government and the poor deserve it. When the secretary saves for the rest of her life, and she will need to because Social Security is a pile of steaming dog pooh, should she pay 35% on her mutual fund generated retirement income that she needs to survive in her retirement years? Oh wait, she's not rich. Hopefully, she is a government secretary. Then her retirement will be taken care of for as long as she lives and, in the equitable and benevolent way that the only the government can guarantee.......as long as they can keep finding ways to collect more taxes.
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