[Macguyver]

$1:

US Republican leaders have accused president Barack Obama of "class warfare" as he prepares to unveil plans to increase taxes for millionaires.

Obama is set to reveal details of the so-called "Buffett tax" – named after billionaire investor Warren Buffett, who has repeatedly called for the rich to pay higher taxes – on Monday. Obama looks set to propose a tax hike for those earning more than $1m a year as part of a wider plan to tackle the US's massive deficit.

The proposals, which have little chance of becoming law without Republican support, look set to become the latest battle ground for Republicans and Democrats gearing up for next year's election and an increasingly contentious fight over how to support the US's struggling economic recovery.

Paul Ryan, chairman of the House of Representatives budget committee, said: "Class warfare may make for good politics, but it makes for rotten economics." Speaking on Fox News Sunday, Ryan said the plan "adds further instability to our system, more uncertainty, and it punishes job creation and those people who create jobs." Ryan said higher taxes would hurt job creation. "If you tax something more, you get less of it," said Ryan.

Mitch McConnell, the Senate Republican leader, said the proposal would further damage the US's fragile economy. "We have thrown a big wet blanket over the private sector economy. We've borrowed too much, we've spent too much and we've dramatically over-regulated every aspect of the private sector in our country and now we are threatening to raise taxes on top of it. That's not going to get the economy moving," McConnell said on NBC's Meet the Press.
http://www.guardian.co.uk/world/2011/sep/18/obama-millionaire-tax-war

[Macguyver]

All this talk about protecting the millionaires and billionaires who apparently create all the jobs, its making me sick but according to the GOP; “It adds further instability to our system, more uncertainty and it punishes job creation and those people who create jobs. Class warfare may make for good politics but it makes for rotten economics.”

My take: If you’re serious when you say that the mega rich should be protected because they create jobs, then let’s see those jobs. With unemployment at 9.1% and more Americans living in poverty now than any other time in the last 50 years, and the rich paying less taxes and receiving billions in bailout money and access to billions in government spending designed to stimulate the economy – it begs the question WHERE ARE THESE JOBS???

My solution? Propose a tax hike for these so called “job creators”. Make it retroactive to Jan 1, 2011, but do not implement it until Jan 1, 2012. Then take a look at how many jobs these folks are creating, and create tax them appropriately based on the real number of jobs that they are creating. More employment – less taxes.

If these people really are the saviours, if they are creating jobs, then reward them for doing so. If it is all rhetoric designed to brainwash the middle class into thinking that the millionaires and billionaires are untouchable, then let them pay taxes at the same rate as the majority of Americans.

It is simple, for every job created the tax rate goes down. If the status quo persists then the rich pay the same percentage as the folks making $60K per year. If by some miracle the employment rate drops, then the amount the rich pay drops proportionately with the floor being the tax rate it is today.
Three great things could come out of a proposal like this:

1) More Jobs
2) More tax revenue (either way right?)
3) The GOP can stop preaching “SOB” (Save our Billionaires) and actually attract voters who do want to tax the rich and/or get a job.
You got a few billion dollars and/or make a million or more a year? Put your money where your mouth is and join the rest of America in the trenches to save the economy: Put Up or Shut Up.

[DanSC]

I'm sure the $1 million value for the new tax bracket was meticulously calculated and not just arbitrarily chosen.

[BartSimpson]

Macguyver Macguyver:

Make it retroactive to Jan 1, 2011

The US Constitution specifically prohibits ex post facto (after the fact) laws because the Founding Fathers planned ahead to put the brakes on vindictive people like yourself.

[Macguyver]

BartSimpson BartSimpson:

Macguyver Macguyver:

Make it retroactive to Jan 1, 2011

The US Constitution specifically prohibits ex post facto (after the fact) laws because the Founding Fathers planned ahead to put the brakes on vindictive people like yourself.

Well I'll change that line and consider your post an endorsement! Thanks!

[DanSC]

BartSimpson BartSimpson:

Macguyver Macguyver:

Make it retroactive to Jan 1, 2011

The US Constitution specifically prohibits ex post facto (after the fact) laws because the Founding Fathers planned ahead to put the brakes on vindictive people like yourself.

I'd tend to think more highly of people like Macguyver if their sentiment was "everyone needs to pay a fair share" instead of "everyone needs to pay more except me."

[andyt]

@Dan - where specifically did McGuyver say everybody needs to pay more except me?

@ McGuyver - it's not about the rich paying the same rate as someone making 69k a year, they pay a lot lower rate. That was Buffet's point, that he paid half the rate of income tax that his secretary did. Of course in a proper progressive system, the more you make, the higher a percentage you pay. But let's aim for paying the same percentage first.

[Brenda]

What I have been hearing, is that the wealthy pay less in taxes than the middle class earners. THAT is ridiculous. Why wouldn't all (except for the low wage earners, up to $25,000/yr or something) pay? How can Buffett pay less than his secretary's assistant pays in taxes?
Make sure CEO's are taxed by their income (including dividends etc) and not by their paycheck. Steve Jobs was on the payroll for a whole $1/yr for years. If he did not pay taxes, how fair is that?

(yeah, I know, my grammar sucks this morning. Bear with me, my coffee is not really doing the usual good job of making me a brunette after waking up blonde )

[andyt]

Brenda Brenda:

What I have been hearing, is that the wealthy pay less in taxes than the middle class earners. THAT is ridiculous. Why wouldn't all (except for the low wage earners, up to $25,000/yr or something) pay? How can Buffett pay less than his secretary's assistant pays in taxes?
Make sure CEO's are taxed by their income (including dividends etc) and not by their paycheck. Steve Jobs was on the payroll for a whole $1/yr for years. If he did not pay taxes, how fair is that?

(yeah, I know, my grammar sucks this morning. Bear with me, my coffee is not really doing the usual good job of making me a brunette after waking up blonde )

They don't pay less taxes. But with the deductions available to them they pay a much lower rate.

$1:

Mr Buffett said that he was taxed at 17.7 per cent on the $46 million he made last year, without trying to avoid paying higher taxes, while his secretary, who earned $60,000, was taxed at 30 per cent.

And Steve Jobs would have paid taxes on dividends, capital gains etc. Just that he would have been able to take advantage of various loopholes to reduce his tax rate.

The biggest loophole is the mortgage deduction. Most people say they should get rid of it. It causes people to maintain huge mortgages on their houses, was in part responsible for the housing bubble. And, homeownership is actually slightly higher in Canada, which has no such deduction.

[bootlegga]

Brenda Brenda:

What I have been hearing, is that the wealthy pay less in taxes than the middle class earners. THAT is ridiculous. Why wouldn't all (except for the low wage earners, up to $25,000/yr or something) pay? How can Buffett pay less than his secretary's assistant pays in taxes?
Make sure CEO's are taxed by their income (including dividends etc) and not by their paycheck. Steve Jobs was on the payroll for a whole $1/yr for years. If he did not pay taxes, how fair is that?

(yeah, I know, my grammar sucks this morning. Bear with me, my coffee is not really doing the usual good job of making me a brunette after waking up blonde )

In total dollars, a rich person almost always pay far more than a typical middle class earner, but Buffet was talking about the percentage of tax they pay. So while Buffet may pay $50 million in taxes, he pays maybe 20% of taxable income, while his secretary pays 22% of her taxable income (maybe $15,000 or so). The totals are nothing more than wild ass guesses, but I hope that explains it better.

It can work the same way up here.

Because of tax credits and programs, wealthier people can generate more deductions than lower income earners can. As such, a lawyer making $200,000 a year can get deductions for sport/art programs his kids participate in, he can drop $5000 into a TSA, top up his RRSPs, etc, while someone making $40,000 a year probably isn't putting $5000 into a TSA, or topping up their RRSP every year either.

[Brenda]

Oh, I know there are plenty loopholes. The year we arrived in Canada, our taxable income was Euro 5,000. Gotta love having your own company and mortgage interest deduction.

[BartSimpson]

I'd give Warren Buffet more credit if he simply agitated to revoke all of the tax breaks and deductions he takes so people like himself could simply pay what's due.

Forgive me, but in all of this manoeuvering by Buffet I suspect at the end of the day he's plotting to pay less taxes at the end of it than he does right now.

[martin14]

BartSimpson BartSimpson:

I'd give Warren Buffet more credit if he simply agitated to revoke all of the tax breaks and deductions he takes so people like himself could simply pay what's due.

Forgive me, but in all of this manoeuvering by Buffet I suspect at the end of the day he's plotting to pay less taxes at the end of it than he does right now.

[Brenda]

martin14 martin14:

BartSimpson BartSimpson:

I'd give Warren Buffet more credit if he simply agitated to revoke all of the tax breaks and deductions he takes so people like himself could simply pay what's due.

Forgive me, but in all of this manoeuvering by Buffet I suspect at the end of the day he's plotting to pay less taxes at the end of it than he does right now.

As far as I know, you will automatically get the deductions, whether you apply for them or not.

[DanSC]

I'm mostly surprised the American Democratic party is listening to someone from Nebraska. Many of their membership hold the belief that if you can't see an ocean, you're a terrible human being.