The American Spectator

The Obama Watch

Fans of Barack Obama are impressed with his ability to do two or three things at one time, as am I. Here is a classic twofer: he succeeded in exposing both the intellectual inadequacy and the moral bankruptcy of his worldview in one terse statement. As a bonus he threw in an example of his deceitful manipulativeness.

This came in his recent press conference when he was asked to defend his proposal to reduce the maximum deductibility of charitable donations to 28 percent. Under his proposed regime, someone who pays 39 cents in taxes on each earned dollar would only receive 28 cents off his total tax bill for each dollar contributed to the poor.

Here is the President's explanation:

And what we've said is: Let's go back to the rate that existed under Ronald Reagan. People are still going to be able to make charitable contributions. It just means, if you give $100 and you're in this tax bracket, at a certain point, instead of being able to write off 36 percent or 39 percent, you're writing off 28 percent.

Now, if it's really a charitable contribution, I'm assuming that that shouldn't be the determining factor as to whether you're giving that $100 to the homeless shelter down the street.

And so this provision would affect about 1 percent of the American people. They would still get deductions. It's just that they wouldn't be able to write off 39 percent.

In that sense, what it would do is it would equalize -- when I give $100, I'd get the same amount of deduction as when some -- a bus driver who's making $50,000 a year, or $40,000 a year, gives that same $100. Right now, he gets 28 percent -- he gets to write off 28 percent. I get to write off 39 percent. I don't think that's fair.

So I think this was a good idea. I think it is a realistic way for us to raise some revenue from people who've benefited enormously over the last several years.

Now let's measure these remarks by the three standards indicated earlier: intelligence, morality and honesty.

In terms of intelligence, as limned by reasonableness and logic, this is completely cockeyed. He is saying it is not fair for a rich person to save 39 cents of tax per charity dollar while a middle-class person only saves 28. The fallacy is obvious. The idea of charity being deducted is the notion that the society is being helped by direct action in a way which obviates the need for taxation.

Take that homeless shelter down the street. It receives some of its dollars from citizens, some from the government. There is no point in the government taking part of your dollar to give to the homeless shelter when you are prepared to give it the entire dollar.

Thus it is not true to say the dollar you give to the shelter is untaxed. On the contrary, it is taxed at the rate of 100 percent, a taxation to which you have submitted voluntarily. At this point, government has no interest in blocking your transaction, since you are achieving the same charitable end without its intervention.

If a man in a 39 percent tax bracket gives that dollar and we only allow him a 28 cent deduction, we are de facto taxing him at a rate of 111%. In essence, he has to write the government an eleven-dollar check to give the homeless shelter in order to get permission to give his hundred dollars to the same shelter. This is fairness… on which planet?

If anything, the argument could be advanced the other way. Since the 28 percent guy is voluntarily taxing himself 72 cents beyond the government requirement while the richer guy is only adding 61 to his obligation, the former should get 11 cents off his next dollar's tax.

NOW TO MORALITY. Clearly, what propels this illogic is a sense that a person exercising disposition of his own philanthropy is a usurper, an interloper, an underminer of government as the sapient determiner of need. Who is this private bozo to say this widow should rather be helped than that orphan? It is best left to government as impersonal arbiter of fate and collector of vital statistics to apportion benefits based on its assessment of social equity.

This vision of government as a moral agent superior to the individual citizen informs all the policy thinking of Obama and the intellectual wing of the Democrat party. To see it operate to such an extent is fascinating. Think of the mind-set required to describe a person giving a spontaneous gift to charity as "getting a tax break"!

Notice also the sanctimoniousness of saying that if it is "really" a charitable contribution, the tax implications should not be a consideration. This again deflects the main moral reality here; namely, the government taxing him on the dollar he gave away to the homeless shelter is the monstrous act of moral blindness. To call him crass for noticing the injustice is a crowning iniquity. This man took a rightfully earned dollar and turned it over unselfishly to the poor, and the government wants to charge him 11 cents for the right.

WHICH BRINGS US TO DISHONESTY in presentation, a style reminiscent of the predator offering candy to the kid in the schoolyard. Look at his trick of invoking Ronald Reagan by saying the "tax break" would be the same twenty-eight cents it was under Reagan.

A good example would be those sales where a store that opened in 1959 celebrates its 50th anniversary by offering its hamburgers at the original price, say ten cents. This is a generous and fun way of bringing people in and reminding them of a half-century of reliable service.

Now what if the company said they were doing a 50 percent-off sale, but to celebrate the anniversary they would only give the discount based on the 1959 price? So if the hamburger costs five dollars now, they will give a nickel off the price, the equivalent of a 50% sale on Opening Day in 1959. The price of your burger: five dollars minus five cents, for a total of $4.95. Everyone would rightly scorn such a promotion.

But that is what Obama just said. We will tax you at the new 39 cent rate, but we will discount your contribution according to the old rate. So you will get 28 cents off the 39 cents you owe on that dollar, leaving you to pay Uncle Sam 11 more cents. And why the figure of 28, you ask. That is to honor the memory of Ronald Reagan, who gave the same reduction.

Helloooo?! Reagan gave 28 cents off your tax per charitable dollar because he was only taxing 28 cents per dollar. What a nasty, corrupt -- dare I say meretricious -- stunt to put over while cloaking oneself in the mantle of fairness.

We have analyzed Obama's approach and found it illogical, immoral, and dishonest, all rolled into one pretty package. Heaven help us.