How Barack Obama's 'Buffett' Tax Hurts the Middle Class

Reader Comments
Back to blog

I won't vote for Obama again because his campaign of "fairness" is a farce. As an American and as a moderate I feel betrayed by his antics, from the use of Bin Laden as a political trophy to his basic dishonesty about Solyndra (and the supposed Bush admin connection)and his bailouts for campaign supporters. He is up there with John Edwards' "two America's" when it comes to hypocrisy.

George of CA 8:56PM May 11, 2012

One man's fairness is another's hypocrisy. When half of the population pays no federal income tax it is hard to imagine someone increasing taxes on existing taxpayers as being fair.
When Keynes was writing about the power of government investment as a stimulus, the productivity gap between the public and private sector was quite small... everyone was using typewriters, carbon paper and pencils, etc.
Today the gap is profound. Many public sector employees are using technology that is 10 years behind the private sector. Money pulled out of the more dynamic private sector and into a world of outdated supply chains simply slows down the economy. And the "ripple effect" is muted.
If public sector spending was as or more effective than private sector spending then Detroit, for example, would be one of America's wealthiest cities.
IMHO Obama isn't stupid, he just likes to pander to his base with grants, bailouts and no federal income tax. We need a flat tax, if nothing more than to encourage everyone's interest in a more productive and efficient public sector.

Anonymous of CA 8:43PM May 11, 2012

US News, REALLY? That's even not at all what the Buffett Tax is! if you are making $1M/year, you'd be affected by the adjusted tax rate. Capital gain tax debate is a different issue altogether.
seriously guys, wiki it

Jayy Y of MA 8:01PM May 11, 2012

Kudos, DR! Furthermore, the main argument of this opinion (not much in the way of facts here, just quotes of other opinions) is that if those who invest have to pay a few percentage points more, they'd reduce their investments. So, what else do you think they are going to do with their money? They're going to invest somewhere. The threat to investments in the stock market (which is now almost entirely speculative instead of performing its intended purpose of raising capital for economic expansion) is that it under-performs other investments. Over the past 12 years, the stock market has under-performed bonds. Maybe you would like to raise taxes on bonds so your investment in stocks would be more attractive? Oh, wait, that would make it more expensive for all levels of government to raise non-tax revenue for necessary functions and investments. Bad idea.
This is similar to another completely wrong "conservative" canard that if taxes are raised on the "job creators," those persons and companies will stop creating jobs. Ridiculous. If you are making $50K a year and, with a little bit more risk (e.g. pushing for a promotion to a position you might not be experienced enough yet to do well) you could make $75k per year, you'd take the risk and get the reward. If you got the promotion but then found out you'd only make $65k instead of $75k, would you not bother taking the risk and keep your old job and turn down the extra $15k? Of course you wouldn't. You'd take the job, be a little upset at the "lost" $10k, but happy for the $15k you are getting.
Do you remember Bill O'Reilly and others saying that if the Bush tax cuts expired they would have to pay so much more in taxes they would just quit their jobs? I don't believe it. "Oh no, I'm only going to net $9million instead of $10million. It just not worth getting out of bed!" Ha!

Eric of NY 7:03PM May 11, 2012

It's not such an ironclad case that taxing billionaire's capital gains would depress the stock market. Another plausible argument based on market theory goes like this: Stock investments and bonds especially are basically loans to companies. The dividends and gains companies give back to their investors and bondholders are payment for those loans. If billionaires decreased the amount they invest, companies would have to increase how much they're willing to pay for capital, raising the yields for everyone else.
Economics isn't hard science so we can't run a proper scientific experiment to test this hypothesis vs. the one proposed in the article, but that's the point -- this article is full of unprovable speculation that could easily be argued the other way, depending on which way you swing politically.

DR of CA 5:09PM May 11, 2012