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WHAT OTHERS SAY: Tax breaks for the wealthy are the whole ballgame

Monday, July 16, 2012 | 2:29 p.m. CDT

In the old days, Labor Day marked the start of the presidential race. This year Democrats won't officially choose their candidate — our guess is Barack Obama — until two days after Labor Day.

The campaign between the incumbent president and his putative Republican challenger Mitt Romney began to crystallize last week. The 2012 campaign, more than any since 1932, will turn on the economy. Last week, the stark differences between the two candidates on the issue began to form around one fundamental policy difference.

Mr. Obama kicked it off on Monday by inviting a group of middle-class families to the East Room of the White House and telling them, "Let's not hold the vast majority of Americans and our entire economy hostage while we debate the merits of another tax cut for the wealthy."

The president wants to allow the top marginal tax rates to return to where they were before President George W. Bush and Congress reduced them — "temporarily" — in 2001. The effect would be that American households would begin paying higher rates on every dollar of taxable income above $250,000. Only about 2 percent of households earn that much.

This reprises the arguments of 2010, when Mr. Obama agreed to extend all of the Bush tax cuts, including those for the wealthiest 2 percent. But unless Congress acts before year's end, everyone's tax rates will return to where they were during the Clinton administration. Mr. Obama's argument is that to protect the richest 2 percent, Republicans are willing to allow everyone's taxes to go up.

This is where the president has chosen to make his stand. He spent much of the rest of the week campaigning on the issue.

Mr. Romney responded immediately, saying on a radio show that his own tax plan "brings down the rate of taxation for individuals and for small business and for businesses of all kinds" while limiting tax breaks used by wealthier taxpayers.

This has been his plan since the primaries. He has not yet been specific about the breaks he would eliminate.

Regardless of foreign affairs, wars and other issues, the tax issue is the whole ballgame.

It speaks to Mr. Romney's insistence — despite a new Congressional Budget Office report that federal taxes are at an all-time low — that taxes are too high and sometimes confiscatory.

It speaks to the small-business owners who drive most of the job creation in this country while the wealthy park their money in hedge funds and the Cayman Islands. Only 2.5 percent of actual small-business owners would face higher taxes under the president's plan.

It speaks to the Republicans' theological belief — despite negative job growth after the Bush tax cuts — that low taxes yield more jobs.

It speaks to issues like the fact that the richest 400 American families are now worth more than the poorest 150 million.

It speaks to budget problems and fixing the deficit. The two-year extension of tax cuts for the wealthiest 2 percent cost the treasury $80 billion. Over 10 years, Mr. Obama's tax proposals — which include raising the tax on capital gains from 15 percent to 20 percent — would raise $850 billion.

Facts and fairness are on the president's side. Mr. Romney counters with money and mythology. This is the choice. The game is on.

Copyright St. Louis Post-Dispatch. Reprinted with permission. Questions? Contact Opinion editor Elizabeth Conner.


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Comments

J Karl Miller July 16, 2012 | 7:12 p.m.

This just may be the silliest St Louis Post Dispatch editorial of the year. If "facts and fairness" are on the President's side, it should make a better showing than the Post Dispatch states. Let's see---by repealing the tax cuts for those making over $250,000 a year and raising the Capital Gains tax rate from 15 to 20 percent will add 850 billion dollars to the treasury over a ten year period.

However, President Obama's boosting of the national debt by an average of 1.5 trillion per year will result in an increased deficit of 15 trillion dollars over the same time frame. And, when one considers that approximately 50 percent of the population invests in stocks and receives dividends, is this not an added taxing of the middle class?

The administration and the Post Dispatch must be using the new math.

(Report Comment)
Derrick Fogle July 16, 2012 | 9:08 p.m.

So glad you hate it, Karl! Speaks volumes, it does.

It's true the estimated amount is a pittance in the overall scheme of things. But true to the brainless hypocrisy of GOTP minset, we already hear the chant: "The amount is NOTHING! But, it will KILL the economy!"

Bozos.

Notwithsanding this, of course: http://www.forbes.com/sites/rickungar/20...

Or this: http://twitpic.com/a2v729 Regardless of the perplexing durability of the moronic ideology, allowing the wealthiest capture more and more income is detrimental to domestic job creation.

For the record, if the "Conservatives" are serious about debt reduction, they'll stick to the current "doomsday" legislation that raises everyone's taxes and makes, for the first time, real cuts in discretionary spending budgets.

Of course they won't. They'll be the ones that squeal like stuck pigs over cuts in the single largest discretionary spending line item. In fact, they'll want to ADD to that, not reduce it. Just watch.

As long as that extra spending is balanced by cuts in the single largest line item of "socialist" spending - welfare for the elderly and retired - I'll go along with it.

(Report Comment)
frank christian July 16, 2012 | 9:33 p.m.

h4 - Give us a break and go to bed.

(Report Comment)
Derrick Fogle July 16, 2012 | 9:35 p.m.

Furthermore, how about a little empirical evidence on the matter?

1) Supply-side economics have been in place for over 30 years.
2) Aggregate federal tax rates are the lowest in 50 years.
3) Our economy is performing at it's worst in 50+ years.

But all we get out of the braindead is, "This isn't working, we must just need MORE OF IT!"

(Report Comment)
Rich C. July 16, 2012 | 11:35 p.m.

Frank,

Doesn't the nursing home limit time on the internet? I thought you old folks were in bed by 8 (right after checkers).

(Report Comment)
frank christian July 17, 2012 | 6:36 a.m.

No, some sit up trying to think of "thought" problems that might prove that their lie, is the truth. Then others, not that talented, turn to the "funnies".

(Report Comment)
Michael Williams July 17, 2012 | 10:13 a.m.

Rick says, "...Doesn't the nursing home limit time on the internet? I thought you old folks were in bed by 8 (right after checkers)."
_______________________

And this comment added....what?...to the conversation? Did you get a thrill writing such a thing? Goosebumps from a self-perceived razor-sharp wit learned from a local playground from which you never graduated?

Is this how you argue? Perhaps you should grow up a bit before you rejoin the conversation.

Frank's lived a long life and experienced stuff that happened before you were born which to you, of course, is the date "history" started. He may indeed be abrasive at times, but you shouldn't fade him.

After all, he just might be right at times.

Older folks have reasons to be cranky. Show some respect.

(Report Comment)
frank christian July 17, 2012 | 3:48 p.m.

Just another thought, before bedtime. "Over 10 years, Mr. Obama's tax proposals — which include raising the tax on capital gains from 15 percent to 20 percent — would raise $850 billion." I and about everyone in the "nursing home", pay capital gains tax, if we realize any gain on about any investment and most ain't rich.

The Democrats Need these funds! PolitiFact and GOP tell us our Federal Gov't borrows on average 4B$ per day. They would not have to borrow for around 7 months! Or, if, as D's say they like to do, "pay as you go", they could pay the 850B$, CBO says already spent for Obamacare set up fees.

My bet is, they wouldn't do either of those things.

(Report Comment)
Rich C. July 17, 2012 | 6:12 p.m.

"And this comment added....what?...to the conversation?"
What my comment added to the conversation is on par with what Frank's comments add to the conversation.

"Is this how you argue? Perhaps you should grow up a bit before you rejoin the conversation."
You're right...I should've used terms like communist, marxist, socialist to get my point across. That's much more adult-like than "old".

"Show some respect."
I will give respect where it's due.

(Report Comment)
J Karl Miller July 17, 2012 | 8:16 p.m.

Come now Mr Fogle--You admit that 850 billion over 10 years is but a pittance--more symbolic than substantive. The left, which, by the way, includes the President, uses that pittance as a class warfare club aimed at inflaming resentment of the wealthy while ignoring the 15 trillion dollars of deficit over that same ten years.

Oh, by the way Mr Fogle, what discretionary and entitlement cuts has the President proposed? As I recall, Mr Obama commissioned the Simpson/Bowles Commission to provide a solution to our spending problem and immediately ignored it.The Democratic Party will never be serious about ANY program that does not include the raising of taxes.

(Report Comment)
Christopher Foote July 18, 2012 | 9:42 a.m.

"...what discretionary and entitlement cuts has the President proposed..."
I do believe that the ACA, which Mr. Miller so fiercely opposed, included $575 Billion in Medicare cuts. Not only was that proposed it was passed and signed into law. Note that it passed the senate with a super-majority of 60 votes.
I would also note that President Obama has not said he was repealing the Bush Era Tax cuts, rather they are set to expire. With respect to Simpson-Bowles, the commission itself failed to endorse its own plan. Obama has included many of the Simpson-Bowles deficit reducing proposals in his plan though; they are therefore quite similar. He proposed to reduce the deficit by more than $4 trillion over 10 years by shaving all spending, including for the military, Medicare and Social Security, coupled with overhauling the tax code to raise revenues and lower rates. Mr. Miller's advice appears to be that Mr. Obama should endorse the plan put forth by...Mr. Obama. One would think, that as a weekly political columnist, Mr. Miller would have if not read at least be aware of the President's deficit reduction plan.
Lastly, the middle class pays very little capital gains taxes. Perhaps the reality based community has a different definition of what it means to be middle class. Mr. Miller's arguments are weak (and largely untrue) because it is difficult to argue that regressive tax rates are beneficial to society. It certainly doesn't help that the candidate championing this position paid an effective tax rate of less than %15 on an income in excess of $20 million (for 2010).

(Report Comment)
J Karl Miller July 20, 2012 | 8:23 a.m.

Mr Fogle,

First, I must call your attention to the fact that the ACA was NOT passed by a super majority as you claim. When the Kennedy seat passed into Republican hands, there was no super majority--ergo, led by Majority Leader Harry Reid, the Senate resorted to a sleight of hand and passed it by "Reconciliation" requiring but a simple majority. As for the 500 billion dollar cut in Medicare, that was done merely to cut the total estimated cost to under a trillion dollars. It has yet to go into effect.

As a political columnist, I rely on more than DNC talking points, the Huffington Post and the Daily Kos--the President's "proposal" to reduce the deficit by 4 trillion dollars over 10 yearsis nothing more than empty rhetoric-- he will not address entitlements other than to say "they are on the table." His Congressional leadership has stated flatly that Medicare, Social Security and Medicaid are not open for discussion.

The fact that this evil 2 percent takes in 19 percent of the income and pays 38 percent of the income tax notwithstanding, I notice that you refuse to address the deficit spending of an average of 1.5 trillion per annum. Surely, there is room in this massive overspending to make up the totaly symbolic tax increase on the wealthy.

Your comment about Mr Romney's being taxed at but 15 percent is evidence that you are one with the President in the practice of class warfare. You seem to forget--or perhaps you do not realize--that Mr Romney's interest and Capital Gains income has already been taxed.

It is difficult to discuss with a straight face, a deficit reduction plan when the deficit spending averages 1.5 trillion with no sign of abatement.

(Report Comment)
Christopher Foote July 20, 2012 | 9:46 a.m.

@Mr. Miller,

Here is the Library of Congress link to the ACA Bill:
http://thomas.loc.gov/cgi-bin/bdquery/z?...
Here is a summary of the legislative action:
9/17/2009 Introduced in House
10/8/2009 Passed/agreed to in House: On motion to suspend the rules and pass the bill Agreed to by the Yeas and Nays: (2/3 required): 416 - 0 (Roll no. 768).
12/24/2009 Passed/agreed to in Senate: Passed Senate with an amendment and an amendment to the Title by Yea-Nay Vote. 60 - 39. Record Vote Number: 396.
3/21/2010 Resolving differences -- House actions: On motion that the House agree to the Senate amendments Agreed to by recorded vote: 219 - 212 (Roll no. 165).
3/21/2010 Cleared for White House.
3/22/2010 Presented to President.
3/23/2010 Signed by President.
3/23/2010 Became Public Law No: 111-148

Note that it became the law of the land on 3/23/2010.

Your reconciliation bill is titled The Health Care and Education Reconciliation Act of 2010. Library of Congress link:
http://thomas.loc.gov/cgi-bin/bdquery/z?...
Here is the legislative summary of this bill becoming law:

3/17/2010 Introduced in House
3/17/2010 The House Committee on The Budget reported an original measure, H. Rept. 111-443, by Mr. Spratt.
3/21/2010 Passed/agreed to in House: On passage Passed by recorded vote: 220 - 211 (Roll no. 167).
3/25/2010 Passed/agreed to in Senate: Passed Senate with amendments by Yea-Nay Vote. 56 - 43. Record Vote Number: 105.
3/25/2010 Resolving differences -- House actions: On motion that the House agree to the Senate amendments Agreed to by the Yeas and Nays: 220 - 207 (Roll no. 194).
3/25/2010 Cleared for White House.
3/30/2010 Presented to President.
3/30/2010 Signed by President.
3/30/2010 Became Public Law No: 111-152
It was signed into law on 3/30/2010 a full week after the ACA was enacted.

Stop misinforming your readers.

(Report Comment)
frank christian July 20, 2012 | 2:01 p.m.

C. Foote - "the ACA, which Mr. Miller so fiercely opposed, included $575 Billion in Medicare cuts." To be taken from Medicare and spent elsewhere on Obamacare. The same $575B$ as I know you recall, was also accounted for again in regard to other "savings", in his plan.

"Note that it passed the senate with a super-majority of 60 votes." Do you think this "note" makes it sound bi-partisan? It does not. One moderate Republican voted for it and since, has wisely retired from the Senate.

If the Bush tax cuts were not set to expire, is it your opinion that BO would not want them repealed? Please!

"Lastly, the middle class pays very little capital gains taxes." Another elitist interpretation of our tax system. Rather than dollar amounts to Government, add up the number of American families that pay capital gains taxes. This, in my experience has always been your liberal point of view. Your only reference to "the people" comes in questions regarding how much government needs from people and how much government has to give to them. Sad.

(Report Comment)
J Karl Miller July 20, 2012 | 7:36 p.m.

Now, now Mr Foote--the 60-39 vote was on 12/24/2009; however, the bill was not signed into law until 3/30/10, following the Senate Reconciliation vote of 56-41. It required reconsiliation to pass. You also mentioned my fierce opposition to Obamacare--I am in good company Mr Foote--at last count 52 percent of the people are still opposed to this unpopular legislation and only 39 percent approve.

However, I am uncertain as to why you bring up health care..the orginal question concerned taxes. I notice you have assiduously avoided a response to the 1.5 trillion dollars annual deficit spending and why the symbolic 85 billion tax on the rich cannot be absorbed therein. You cannot bring yourself to admit that this is classic class warfare practiced by the classic class warrior.

(Report Comment)
frank christian July 20, 2012 | 10:05 p.m.

Somehow, Chris, the
Student Aid and Fiscal Responsibility Act of 2009 which cut off private lending for student loans (I recall your triumphant outcry, something like "how could denying evil banks the right to cheat our students be wrong" was passed with this blessed health care reform act known as "Obamacare".

Reagan's financial plan was the original recipient of those demeaning nicknames, early on, but was dropped when the plan quickly began to Work!

(Report Comment)

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