Obama's 'Tax the Rich' Class Warfare Is Bad Economics

Obama's tax plan is divisive.

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The president has a new tax plan, a program designed to raise revenues for the beleaguered U.S. Treasury by raising taxes on what he says are the wealthiest Americans—who, he and his ideological allies contend, need to pay their fair share.

At its core the plan—and the rhetoric that surrounds it—flows from the idea that tax revenues should be generated "from each according to his abilities to each according to his needs" as a long dead philosopher once put it. Therefore it is curious that Obama continues to bristle at the idea that, by proposing $1.5 trillion in tax increases over the next ten years on those earning more than $200,000 per year, he is engaged in class warfare.

[Vote: Are Obama's Proposed Tax Hikes 'Class Warfare'?]

"This is not class warfare; it's math," Obama said Monday from the security of the White House Rose Garden. "The money's going to have to come from someplace. And if we're not willing to ask those who've done extraordinarily well to help America close the deficit," he continued, "the math says everybody else has to do a whole lot more."

It goes without saying that the one place Obama is not looking for new revenue is within the government itself, where billions if not trillions of savings can be realized through a serious assault on wasteful spending, by closing unnecessary, unneeded and duplicative federal agencies, and by scaling back his own ambitions for new spending, a few of which were announced just the other week in his now infamous joint address to Congress on the subject of job creation.

[See a collection of political cartoons on the budget and deficit.]

Under Obama, indeed under most any Democrat who occupies the nation's highest office, federal spending is subject to a sort of Brezhnev Doctrine: once the federal government starts to spend money on something it should never, must never stop. To do otherwise would be an injustice. Sure you can scale back the rate of increase if you have to—as long as the money continues to flow, even if it's less than you wanted in any given year.

Obama's plan to close the federal spending gap can be summed up in three words: Tax the rich.

[See an opinion slide show of 10 wasteful stimulus projects. ]

Its bad economics even if, in the finest tradition of Saul Alinsky, it might work politically. By focusing on "the rich"—which he defines as millionaires and billionaires in his speeches even while his tax proposals count them as anyone who makes more than $200,000 per year—he is trying to pit one group of Americans against another, saying it is right and just and moral to push the spending burden off on other people. If this isn't class warfare then what is?

There are ways to bring America together, to make the tax code better by making it flatter and simpler, to get the economy going again, and to address Washington's addiction to over-spending. Obama just hasn't figured out yet what they are. Perhaps he should spend more time listening and less time making speeches.

  • Check out a roundup of editorial cartoons on the economy.
  • Vote: Do the Rich Pay Enough in Taxes?
  • Scot Galupo: By Playing On Envy, Obama Asks Americans to Abandon Aspirations