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The Obama Watch
Write a Check, Mr. President
Barack Obama fails the “Buffett Rule,” depriving his government of vital revenue.
(Page 2 of 2)
The Obamas also could toss in a few grand in alimony. True, neither Barack nor Michelle Obama has a former spouse. But, again, that shouldn’t bother America’s cash-strapped Treasury.
Claiming to receive Social Security or unemployment insurance might be a bit awkward. However, the president could add some amount for annuities. A big number, since no additional form or documentation is required.
Inflating earnings is just one way for the Obamas to hike their tax liability. They also could do more to pay their fair share by reducing claimed deductions and credits. For instance, they list $5,911 for half of the self-employment tax paid and $49,000 for a retirement (SEP) contribution. Social Security is effectively bankrupt and the Obamas won’t have any trouble making money after the president leaves office. They should have left off these deductions. A matter of social justice and all that.
The real money-maker, however, would be to stop claiming itemized deductions. The Obamas subtracted a sizable $278,498. Sure, doing so might be legal. But is it moral? Think of all the vital revenue they are denying Uncle Sam!
The Obamas could make sure that they paid their fair share — and simultaneously demonstrate that they are in tune with “real” people, who don’t enjoy lavish, tax-preferred write-offs — by taking the standard deduction, which would be $11,600 for the couple. Knocking $266,898 off their write-offs would let the Obamas pass the “Buffett Rule.” Problem solved!
But if that wasn’t enough, they also could forget the $5,841 in foreign tax credits claimed. Heck, why shouldn’t the Obamas simultaneously support Uncle Sam and a foreign government or two? States overseas need love (and money) too. It’s a matter of fairness worldwide.
The Bidens should do the same. Vice President Joe Biden declared: “We’re not supposed to have a system with one set of rules for the wealthy and one set of rules for everyone else.” Yet they made a nice $379,035 last year. (Since the Bidens made no income adjustments, their gross income is the same as their adjusted gross income.) That’s not uber-rich, but I wouldn’t turn down the extra cash.
On those earnings they paid $87,663 in federal taxes. Granted, they aren’t making a million, and they are paying a slightly higher rate than the Obamas — about 23 percent. However, they also fall substantially short of the magic 30 percent. Whatever happened to paying a higher rate than your secretary?
The Bidens should follow the same strategy as the Obamas. Write a check for $26,048 to get over the 30 percent threshold. Or toss in some extra income. The Bidens list no dividends, for instance. What an exciting opportunity for creative accounting! Then there are those empty lines for annuities and alimony on their tax return.
Moreover, the Bidens claimed $60,628 in itemized deductions. Simply listing the standard $11,600 would run up their tax liability. Think of how much money the federal government would “save.”
Yet when this idea was broached with the White House, Jay Carney said “Well, we disagree.” He dismissed the proposal: “Another real classy charge is the idea that, well, wealthy Americans who feel like paying their fair share, feel like paying taxes at a rate that middle-class Americans do — if they don’t, they have the option of doing it themselves by writing a check.” Well, rich Americans like the Obamas and Bidens do have that option. If the government won’t make them pay more and they view doing so as a moral duty, then why not ask them to contribute voluntarily?
Argued Carney: “Think what that says to middle-class American families who are trying to get by, who are paying their taxes and paying at a rate higher than Warren Buffett.” Actually, it would say to them that rich people like Buffett and the president who don’t believe they are paying enough are willing to put their money where there mouths are. Step up, do your duty, and write a check.
America’s tax system is a mess. Taxes should be used to raise revenue, not manipulate behavior. Rates should be lower; filing should be simpler.
We can argue about what constitutes “fairness” and how much the “rich” should pay. But those arguing for the “Buffett Rule” have an obligation to walk the talk. It’s bad enough for a really rich guy like Warren Buffett to claim he should be paying more — and do nothing. It’s far worse when someone, like the president, tries to take political advantage of the issue and then does nothing.
If President Obama hopes to win votes by posing as a defender of the middle class, he should make sure that he pays a higher tax rate than the middle class. Write the check, Mr. President!
About the Author
Doug Bandow is a senior fellow at the Cato Institute. A former Special Assistant to President Ronald Reagan, he is the author and editor of several books, including The Politics of Plunder: Misgovernment in Washington (Transaction).
Letter to the Editor View all comments (20) | Leave a comment
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Appleby| 4.25.12 @ 6:43AM
Congress should also follow suit, and all union employees.
Okay, back to reality now, folks.
Jack in Wi.| 4.25.12 @ 7:48AM
Buffet should leave all his money to the government. Most of it seems to be going to leftwing charities like Planned Parnethood anyhow.
Mick Hawk| 4.25.12 @ 2:46PM
I assume you are doing the same.
Bill Hussein O'Stalin| 4.25.12 @ 6:56AM
Actually, it's far worse for Buffett to argue for more taxes for others, while his companies have expensive accounting firms wearing down the IRS over billions in back taxes.
Buffet is a true political con artist. But then again, so is Obama.
http://www.nypost.com/p/news/o.....8q2Woq9yjJ
Obvious question: If Buffett really thinks he and his “mega-rich friends” should pay higher taxes, why doesn’t his firm fork over what it already owes under current rates?
Likely answer: He cares more about shilling for President Obama -- who’s practically made socking “millionaires and billionaires” his re-election theme song -- than about kicking in more himself.
Buffett’s free to back Obama, of course.
And if his firm wants to keep its tax bill low, well, that’s its right, too.
But it would be nice if this “pro-tax-hike” tycoon were a bit more honest about it.
Start, for example, with his grossly disingenuous recent claim that, as he wrote in The New York Times, he paid only 17 percent of his income last year to the government -- even as many working stiffs who make far less than him coughed up higher percentages.
Fact is, unlike most other folks, Warren Buffett gets most of his income from dividends and capital gains, which are nominally taxed at 15 percent.
Prester John| 4.25.12 @ 7:43AM
BHO could set the example for all his buddies on Wall Street, in Hollywood, and in Congress by writing at least a symbolic check to the U.S. Treasury, but that would require him showing a little bit of leadership, something which he has no experience in or understanding of.
Besides, anything his cronies send to the Treasury can't be send to his campaign.
TrueBlue | 4.25.12 @ 5:29PM
In order to lead first you must be able to follow. His ego doesn't allow him to follow anyone. He'll more than happily use people and then throw them aside when it's convenient though!
Indy| 4.25.12 @ 7:56AM
BHO had a large majority in the Senate and House for the first two years of his term. I don't want to hear anymore about this, he could have taken this on as his number one issue if he wanted to, he could have said, jack up the rates for the evil rich to 39%, 50% or higher but they didn't. If Congress takes no action, everyone's rates will take a jump at the first of the year plus new taxes kicking in under ObamaCare, we all know this is political theater. I'm tired of it and disgusted by it. Class warfare is dividing us...Obama is simply following his playbook and the media plays their role. It would be interesting to see the returns of all the big media heads, espcially those at the NYT and the alphabet channels. Write the check so GSA can waste it.
Indiana Alex| 4.25.12 @ 8:38AM
To hell with the revenue, what about "fairness"?
Denver todd| 4.25.12 @ 9:02AM
Wasn't there a time that Al Gore proposed declaring imputed income on assets? That would be income that you would make on an asset, such as a house, even though you didn't rent out any rooms, for example.
Mick Hawk| 4.25.12 @ 2:44PM
True. Despite the fact you live in the house, Algore etal figured there was an inputed income based on the fact this saved you from paying rent you would have received if you let the property out instead of living in it. Figure that logic out if you can. I sure as hell can't.
Von Mises Jr| 4.25.12 @ 9:12AM
Wake up America. You are arguing the wrong argument.
Capital gains and unearned income from dividends are taxed at 15% for two reasons:
1) To encourage investment
2) You can lose your money as easy as earn money
Obama gets paid some $400K as POTUS and he doesn't even do the job. Moochelle got paid about $325K for a no-show job and she was not replaced. Obama got $800K/yr total in royalties for at least one book that Barry did not even write while the government bought the copies to give as gifts.
There is no comparison to someone investing in a business as an owner or an investor. If I bought stock in General Electric October 1, 2007 (before the crash), it would have cost me $41.77 per share. The uncompetitive Czar, Immelt has crashed the stock to $19.54 today. That would have been a 53% LOSS of my capital. If I bought 1,000 shares at $41,770 and sold it today, I would have LOST $22,230. Great freaking job Immelt!!!
But Obama did not risk his salary and book royalties. They are always positive, not matter how much the job he did sucks.
The tax rate for capital gains and dividends is lower since one must RISK his money. Obama and Immelt got a windfall from government crony capitalism!!!
TrueBlue | 4.25.12 @ 5:30PM
Don't forget capital gains have already been taxed twice before you see it. First when you had to make that cash the first time in order to invest it, and then the second time when the company you invested in pays their income taxes before giving you your share of the profits.
junkyard infidel| 4.25.12 @ 11:42AM
Federal workers owe billions in back taxes
Two percent of the president's staff, 3% of the Senate staff and 4.2% of the House staff are among the 279,000 U.S. government employees who owe the IRS a cumulative $3.4 billion.
http://money.msn.com/tax-tips/.....bc20504dc0
Yougenic | 4.25.12 @ 2:37PM
I'm a small business owner in MD. When summed, I pay over 50% in taxes. 57% when my sin taxes are included. 57%. I'm in the top 5% of earners. I became incensed they day I realized I paid the feds $1 Million in taxes. Not until everyone pays taxes - will I cease being a single issue voter - taxes.
Pat| 4.25.12 @ 8:33PM
Yougenic, sorry to hear that but as a small business owner you probably didn’t include in your tally all the other freebies you do for your Uncle Sam and his nephews among the states. File information reports “required by law” but the law doesn’t require the government to compensate you for your time spent compiling their "vital" statistics. And sales and use tax reports – fun doing those babies, especially if your business activity spans more than one state. And how much do local governments pay you to collect their revenue and fill out their monthly forms – if it’s nothing to them, it’s certainly your time and money spent doing it. So, add up all the “required by law” reports and being our government’s unpaid tax collector and you’ll find it isn’t just the hard dollar taxes you are giving up.
SetOurChildrenFree | 4.25.12 @ 5:06PM
How do you know a Democrat is lying? His lips are moving. Never believe what they say, always observe what they do. When Obama and the Dems talk about rich paying taxes, they mean anyone with a job - and it's been that way for decades.
TrueBlue | 4.25.12 @ 5:32PM
No no, it's anyone with a job that doesn't support THEM. Those guys get a pass on paying too!
Occam's Tool| 4.25.12 @ 5:57PM
Al Gore also owes tens of millions to the government that he made from promoting fraudulent science.
POST American| 4.26.12 @ 1:04AM
---------------------FINAL WORD----------------------
----AGAIN----
in ALLLLLL the capstone authorized
blather about revenue, NOT A WORD
about revoking the TAX FREE status
of the ultra-rich, USURY feuled, subversion
seeding, EUGENICS mongering, capstone
foundations and NGOs.
--------------NOT EVEN A NANO PEEP.
"Remember, in 1939 there were
still sovereign nations to stand in the
way of Hitler's onslaught. Once the
NWO is fully operative there will be
NOTHING to stand in its way."
-ENDGAME
(10 MILLION views online)
In this, the 11th hour of the Globalist CFR
---RED China handover, occupation and
takedown op ----this is light years beyond
NOT GOOD.
Jeannie| 4.26.12 @ 7:27PM
With all the money you would think the least they could pay for their own vacations.