Friday, April 13, 2012

Local Dems ignore truth, parrot Obama lies about Reagan and Buffett Rule

In recent speeches about his proposed Buffett Rule, President Barack Obama has invoked President Ronald Reagan three times in the hopes of convincing conservatives and Republicans to support his new tax.  As if that would help.

The Buffett Rule would set a minimum tax rate of 30% for anyone who earns $1 million or more in a year.

Obama said he'd change the name to the Reagan Rule if it meant gaining such support:

"I'm not the first president to call for this idea that everybody's got to do their fair share. Some years ago one of my predecessors traveled across the country pushing for the same concept. He gave a speech where he talked about a letter he had received from a wealthy executive who paid lower tax rates than his secretary and wanted to come to Washington and tell Congress why that was wrong.

So this president gave another speech where he said it was "crazy" – that's a quote – "that certain tax loopholes make it possible for multi-millionaires to pay nothing while a bus driver was paying 10% of his salary."

That wild-eyed socialist, tax-hiking, class warrior was Ronald Reagan.

He thought that in America the wealthiest should pay their fair share and he said so.

I know that position might disqualify him from the Republican primaries these days but what Ronald Reagan was calling for then is the same thing that we're calling for now: a return to basic fairness and responsibility, everybody doing their part.

And if it'll help convince folks in Congress to make the right choice, we could call it the Reagan rule instead of the Buffett rule."

The only problem is that, like so many other historical references the President has made, he completely distorts the facts and truth of the matter, as Philip Klein at the Washington Examiner explains:

Yes, it’s true that on June 28, 1985, Reagan gave a speech to Bloom High School in Chicago Heights, Illinois about problems with the tax code in which he told an anecdote about an executive who was paying a lower tax rate than his secretary. But if you read the whole speech, it’s clear that Reagan was telling the story as part of his pitch for tax reform.

“Lower, flatter tax rates will give Americans more confidence in the future,” Reagan said that day. “It'll mean if you work overtime or get a raise or a promotion or if you have a small business and are able to turn a profit, more of that extra income will end up where it belongs -- in your wallets, not in Uncle Sam's pockets.”

So there are several key differences with Obama. To start, Reagan was talking about simplifying the tax code, whereas Obama’s Buffett Rule would add another layer of complexity. Reagan was arguing for allowing people to keep more of their own money and reduce the burden of government. By contrast, Obama is arguing for instituting the Buffett Rule so that more money is available to pay for government programs.

Reagan’s push for tax reform helped lead to landmark reform legislation the following year that broadened the tax base, consolidated the nation’s 14 brackets into just two and lowered the top marginal income tax rate from 50 percent to 28 percent. This is actually pretty close to the framework that Rep. Paul Ryan, R-Wis., outlined in the House GOP budget and couldn’t be more far off from Obama’s Buffett Rule gimmick.

But the facts didn't stop local Democrats from jumping on the bandwagon.  Lucas County Treasurer Wade Kapszukiewicz and Commissioner Tina Skeldon Wozniak defended the President's call to tax the rich more.

The county treasurer stated even the late President Reagan believed the rich should pay their "fair share" of taxes.

Lucas County commissioner Tina Skeldon Wozniak stated the Buffett Rule ensures billionaires pay their fair share alongside the middle class. The comments come ahead of a U.S. Senate vote Monday on the president's proposal and was part of an organized statewide effort by the Obama re-election campaign.

As a treasurer, certainly Kapszukiewicz should understand the difference between income tax and capital gains taxes. Capital gains are taxed at a lower rate than payroll income - they are not comparable.

Anyone who gets a paycheck pays payroll taxes.  In Ohio, a person earning $1 million per year from a paycheck would actually pay 31.4% in federal income tax while that same person earning $15/hour would pay only 5% in federal income tax.

Using this payroll tax calculator, I found that a married person filing jointly with two exemptions and earning $1 million per year - or $19,250/week - would pay $6038.36 each week in federal income tax.  That's 31.4%

But that same married person filing jointly with two exemptions earning $31,200 per year - or $600/week - would pay $29.78 each week in federal income tax.  That's 5%.

Apparently Skeldon-Wozniak, who said, "It's not fair for the bus driver to pay 10% and the millionaires to pay nothing," hasn't got a clue what the tax rates are or what people actually pay.

Now, when these two individuals file their 1040s, they will be eligible for certain credits and deductions based upon their individual choices (charitable contributions), spending (unreimbursed business expenses and out-of-pocket medical costs).  Those deductions and credits (most available to both earners equally) will determine if they receive any of their paid taxes back as a refund - or if they owe more.  But the tax rate - the amount they must pay before they get their take-home pay - clearly shows that the millionaire would pay six times as much as the middle income earner.

What I didn't see in any of the news reports on the statements from the President and the parroting by our local Democrats is a question about the people who don't pay any federal taxes at all.

As this chart shows, "...“The percentage of people who do not pay federal income taxes, and who are not claimed as dependents by someone who does pay them, jumped from 14.8 percent in 1984 to 49.5 percent in 2009.”

That means 151.7 million Americans paid nothing in 2009. By comparison, 34.8 million tax filers paid no taxes in 1984."

So I sent an email to both Kapszukiewicz and Skeldon-Wozniak to ask them two simple questions:
Since nearly half of the nation does not pay anything at all in income tax, what is the 'fair share' of that group?

How much should those who are currently paying nothing at all be required to pay in order for them to pay a 'fair share'?

I will publish their responses if and when I receive them.

These are the facts.  Obama, Kapszukiewicz and Skeldon-Wozniak don't want to talk about the millions of people who don't pay anything, much less their own 'fair share.'  They just want to get more out of the people who are already paying.

And they stupidly think that taking quotes from Ronald Reagan out of context and trying to distort Reagan's clear record in support of lower, flatter tax rates will somehow help them accomplish that goal?

Who is advising these people?!?

Sadly, this again demonstrates what we already know:  that our local elected officials care more about politics than anything else. 

The scary part is that Kapszukiewicz is part of the Obama for America Truth Team.  Perhaps he and Skeldon-Wozniak should learn the truth instead of just repeating false political rhetoric.

1 comment:

skeeter1107 said...

There is no compelling economic basis to increase the capital gains rate since it would actually reduce overall tax revenues. Besides, it's never going to get through Congress.

What the entire discussion is really about is to divert attention from the huge problems created by the administration under the heading of "fairness." It's about energizing a base of taxpayers who don't even know or understand what or who the "Buffett" rule is about. They only hear the word "fair."

From the Obama administration perspective, "Fair" and "Fairness" is all they need to hear, because thinking it through takes too long and facts get in the way.

Google Analytics Alternative