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Whatever else they are, the super-rich have now become political props. We can thank President Obama and Mitt Romney for this. Obama thinks he can ride resentment against the rich into the White House for a second term; and Republican Romney’s fortune, estimated at $190 million or more, qualifies him as super-rich.

By all means, Congress should pass the “Buffett Tax,” named after billionaire Warren Buffett, who noted that his 2010 tax rate (17.4 percent) was about half his secretary’s. The explanation is that Buffett’s income comes mostly from dividends and capital gains — profits on sales of stocks and other assets — that enjoy a preferential rate of 15 percent. This is neither socially just nor economically necessary.

Obama’s still-vague Buffett Tax would apparently impose a minimum 30 percent tax rate on incomes exceeding $1 million. Republicans should support it. Economic incentives for risk-taking wouldn’t collapse. Under President Reagan, the top capital gains rate was 28 percent. The economy did fine. And passing a Buffett Tax might improve political truth-telling.

For starters, don’t pretend, as Obama does, that taxing the ultra-rich would solve the deficit problem. Here’s what he said in the State of the Union address:

“Do we want to keep these tax cuts for the wealthiest Americans? Or do we want to keep our investments in everything else, like education and medical research, a strong military and care for our veterans? Because if we’re serious about paying down our debt, we can’t do both.”

We sure can’t. In September, the Congressional Budget Office estimated the 10-year deficit at $8.5 trillion. The nonpartisan Tax Foundation estimates that a Buffett Tax might now raise $40 billion annually. Citizens for Tax Justice, a liberal group, estimates $50 billion. With economic growth, the 10-year total might optimistically be $600 billion to $700 billion. It would be a tiny help; that’s all. “The purpose of the Buffett Rule is not to close the deficit gap,” Buffett has said. Hard choices remain, in part because existing deficit estimates already assume steep defense cuts.

It’s also a myth that all the ultra-rich enjoy low tax rates. In 2007, the richest 1 percent of taxpayers paid an average tax rate of 29.5 percent and provided 28.1 percent of federal revenues, reports the CBO. On their wages and salaries, many of the ultra-rich pay the top income tax rate of 35 percent plus a Medicare tax of 1.45 percent.

Who are these people? How did they get so rich?

In a study, economists Jon Bakija, Bradley Heim and Adam Cole break down the top 1 percent as follows: executives in nonfinancial companies, 30 percent; doctors, 14 percent; professionals in finance (banks, hedge funds, pension funds), 13 percent; lawyers, 8 percent; computer experts and engineers, 4 percent; sales workers, 4 percent; sports, entertainment and media stars, 2 percent. The rest include farmers, management consultants, real estate developers and scientists.

Most of these people probably got rich the old-fashioned way. They worked hard, started businesses (about one in eight is an entrepreneur or manager in a closely held company) or showed great talent. But traditional virtues can’t explain the growing concentration of income. From 1950 to 1980, the top 1 percent represented about 10 percent of Americans’ income; by 2000, this had increased to about 20 percent, where it’s remained, estimate economists Emmanuel Saez and Thomas Piketty.

Explanations abound: “superstar” rewards for those at the top; globalization (by expanding markets for the talented); warped corporate compensation practices. But the biggest contributor was the long financial market boom that inflated executive stock options and Wall Street compensation. “So many people in this group (corporate managers, bankers, traders) have pay that’s tied to the stock and financial markets,” says economist Bakija.

Consider: From 1980 to 2000, stocks rose almost tenfold; from 2000 to 2007, the gain was about 40 percent. And the boom’s largest cause was declining inflation, which reduced interest rates. As rates fell, stocks and other assets rose. The ultra-rich benefited partly from good luck. Ironically, because the boom is spent, the rise of inequality may cease or reverse (Wall Street bonuses are shrinking) just as political attacks on the rich intensify. From 2007 to 2009, the number of tax returns with incomes exceeding $1 million dropped 40 percent, says Scott Hodge of the Tax Foundation.

So, raise tax rates on Warren Buffett and others to upper-middle-class levels. But recognize that the anti-wealthy populist rhetoric is mostly political expediency. It distracts from the serious issues the country faces — creating jobs and closing long-term budget deficits. The anti-rich backlash is growing; a Pew poll finds 66 percent of Americans see “strong” conflicts between rich and poor, up from 47 percent in 2009. Pandering to this is easier than dealing with the future.

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Originally posted by BlueHandedMenace:
I dont believe anyone ever claimed that the Buffett Rule would solve the deficit by itself.....so what is the point of this article?

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For starters, don’t pretend, as Obama does, that taxing the ultra-rich would solve the deficit problem. Here’s what he said in the State of the Union address:

“Do we want to keep these tax cuts for the wealthiest Americans? Or do we want to keep our investments in everything else, like education and medical research, a strong military and care for our veterans? Because if we’re serious about paying down our debt, we can’t do both.”

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Originally posted by BlueHandedMenace:
I dont believe anyone ever claimed that the Buffett Rule would solve the deficit by itself.....so what is the point of this article?

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Originally posted by BlueHandedMenace:
OK, reading comprehension time here....what is the President saying.

That quote clearly states that the money created by the Buffett rule would be used to keep important social net programs funded instead of cut....is that not clear? its an easy read for me...

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In September, the Congressional Budget Office estimated the 10-year deficit at $8.5 trillion. The nonpartisan Tax Foundation estimates that a Buffett Tax might now raise $40 billion annually. Citizens for Tax Justice, a liberal group, estimates $50 billion. With economic growth, the 10-year total might optimistically be $600 billion to $700 billion. It would be a tiny help; that’s all.

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Originally posted by BlueHandedMenace:
OK, reading comprehension time here....what is the President saying.

That quote clearly states that the money created by the Buffett rule would be used to keep important social net programs funded instead of cut....is that not clear? its an easy read for me...

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Originally posted by BlueHandedMenace:
...Never in my lifetime have I seen a president treated with this level of disrespect and dishonesty. Its truly shameful the way none of them can give the Obama the slightest bit of credit for ANYTHING.

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Originally posted by BlueHandedMenace:
This campaign season has been the all-time champion for straw-man arguments.

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Originally posted by BlueHandedMenace:
Show me ONE example of someone in THIS country who hung Bush in effigy, and I will freely admit I was mistaken.

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Originally posted by BlueHandedMenace:
...Show me ONE example of someone in THIS country who hung Bush in effigy, and I will freely admit I was mistaken.

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Originally posted by BlueHandedMenace:
Show me one single place Obama, Pelosi, or any of them said what you are claiming, I know u cant.

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“Do we want to keep these tax cuts for the wealthiest Americans? Or do we want to keep our investments in everything else, like education and medical research, a strong military and care for our veterans? Because if we’re serious about paying down our debt, we can’t do both.”

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Originally posted by BlueHandedMenace:
Sometimes the coarse language gets the point across better. I assume we are all big boys and can handle it.

I am very surprised to see that occurred here. I dont remeber that being covered much, shows how crappy our media is. Clearly I was wrong on this one.

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Originally posted by Geezer:

I've already shown you a quote from the 2012 State of the Union address where Pres. Obama claimed just that, but here it is again.

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“Do we want to keep these tax cuts for the wealthiest Americans? Or do we want to keep our investments in everything else, like education and medical research, a strong military and care for our veterans? Because if we’re serious about paying down our debt, we can’t do both.”

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Sounds like wealth redistribution to me

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Originally posted by Niki2:
However, what Story and Blue have said is absolutely true; Obama never said (nor did anyone ELSE) that the deficit could be cured by taxing the rich.

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Originally posted by Storymark:
Case in fucking point - it catagorically DOES NOT say what Geezer claims - but he keeps making the claim.

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Originally posted by BlueHandedMenace:
OK, so I was wrong.

It was obviously option A

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“Do we want to keep these tax cuts for the wealthiest Americans? Or do we want to keep our investments in everything else, like education and medical research, a strong military and care for our veterans? Because if we’re serious about paying down our debt, we can’t do both.”

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Originally posted by SignyM:

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Sounds like wealth redistribution to me

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So is "profit"... which is a way of saying "the rich get richer and the people who are are suckers". ANY time wealth moves from one group to another, that's "wealth redistribution". Funny how you didn't notice wealth redistributing up into the stratosphere over the past 20 years.

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Originally posted by Geezer:

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Originally posted by Storymark:
Case in fucking point - it catagorically DOES NOT say what Geezer claims - but he keeps making the claim.

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So what does it say then, Story?

Here is the President's statement once again.

“Do we want to keep these tax cuts for the wealthiest Americans? Or do we want to keep our investments in everything else, like education and medical research, a strong military and care for our veterans? Because if we’re serious about paying down our debt, we can’t do both.”

Parse it for us.

"Keep the Shiny side up"

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Nobody with a modicum of intelligence could possibly think that your quote equals "Buffett Rule will fix the debt" like u say. Those words arent in the quote. you can keep pretending they are, but they arent.

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Originally posted by CaveTroll:
Profit is not wealth redistribution

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Originally posted by kpo:

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“Do we want to keep these tax cuts for the wealthiest Americans? Or do we want to keep our investments in everything else, like education and medical research, a strong military and care for our veterans? Because if we’re serious about paying down our debt, we can’t do both.”

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The president, in this quote and in general, makes it sound like a Buffet tax would bring in more revenue than it actually would, without making any outright lie or falsehood. That's the worst that you can say about it.

But a Buffet tax would bring in significant revenue; accounting for 7-8% of the deficit I make it - that's not nothing.

It's not personal. It's just war.

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Originally posted by BlueHandedMenace:
I am very curious how u equate "We cant do both" to "this will fix our defecit" which is what you are claiming he said.

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Originally posted by 1kiki:
"Profit is not wealth redistribution and attempting to claim it is so is merely socialist buffoonery."

Profit is the difference between the pay given for work and the actual sale value of the object. SOMEbody is getting less than the value of their work, and SOMEbody is getting more money than they earned. If that's not wealth redistribution, I don't know what is.

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Originally posted by Storymark:

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Originally posted by CaveTroll:
Profit is not wealth redistribution

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It sure as sh*t is when the only people with the money to influence policy do so to make sure they get bigger and bigger peices of the pie, leaving only scraps for the rest of the population.

But if you're the type to shout "socialist" at anyone who dare suggest that the financial elite SHOULDN'T just be able to do whatever the hell they want, then you're not worth conversing with anyway.

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Originally posted by kpo:
Hang on, scratch what I said here. Obama said: "Do we want to keep these tax cuts for the wealthy..." If I remember right the Buffet tax is about closing loopholes, NOT ending the Bush tax cuts - which have indeed ALREADY added trillions to the deficit...

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Originally posted by Niki2:

Interestingly, there's no attrition of the quote to being about the Buffet Rule, you're right, and yes, given the wording I would bet dollars to donuts Obama was referencing the Bush cuts.

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Either way, keeping the Bush cuts, imposing the Buffet idea, OR cutting programs will not get us there...as has been pointed out, economists AND liberals agree we need to do BOTH cut spending and increase taxes--PLUS increase revenue (if possible in this economy) to even start getting out of this mess.

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Originally posted by CaveTroll:

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Originally posted by Storymark:

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Originally posted by CaveTroll:
Profit is not wealth redistribution

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It sure as sh*t is when the only people with the money to influence policy do so to make sure they get bigger and bigger peices of the pie, leaving only scraps for the rest of the population.

But if you're the type to shout "socialist" at anyone who dare suggest that the financial elite SHOULDN'T just be able to do whatever the hell they want, then you're not worth conversing with anyway.

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I'll likewise add you to my ignore list Story. Since you cannot contain your profanity and failed to even look up the reference to Pigou-Dalton. Which is most assuredly a socialist theory.

Have a nice life.

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Originally posted by BlueHandedMenace:
Its only hard to understand if u are willfully misunderstanding it.

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