‘Giving Back’

by Andrew Stuttaford

 “Offensive” is one of the more over-used words in current American political discourse. People from all parts of the political spectrum often claim to be “offended” by this and offended by that, when what they really are is in disagreement with this, and disagreement with that, and just want to throw a bit of feel-my-pain into the rhetorical equation. All that to say that the remarks made by Obama taken apart so effectively by the Economist below are not, contrary to what the writer suggests, offensive (to be fair, he only says they are “mildly” offensive). They are just, well, let’s be kind, inaccurate. They are also demagogic, dishonest and shrouded in a fake, somewhat patronizing reasonability, but, after more than three years of  the Obama presidency, we should be used to that.

Anyway, here’s the Economist’s Democracy in America blogger (no pillar of the right, to put it mildly):

…[L]et’s suppose for the sake of argument that it’s best if government provides the public goods business needs to become a viable and successful enterprise. Even in that case, Mr Obama’s conclusion, that the rich ought to pay more in taxes, does not follow. As it stands, high-earners do “give something back”: 35% of yearly income. But that’s just to the feds. Here in Iowa, they pay an additional 9% to the state. Maybe it’s just me, but that seems like a lot! According to the Tax Foundation, in 2008 “[t]he top 5 percent earned 31.7 percent of the nation’s adjusted gross income, but paid approximately 58.7 percent of federal individual income taxes”. If that’s not giving something back, what is?

In this light, it’s easy to see why Mr Obama’s observation that it takes a village to make a fortune is in one respect irrelevant and in another offensive. It is irrelevant because the class of people Mr Obama wants to “give back” has already paid most of the tab, and continues to pay most of the tab, for the tax-financed public goods upon which they, and the rest of us, so crucially depend. At the federal level, the top 10% percent of the distribution paid over 70% of income taxes in 2009 (again, according to the Tax Foundation). Mr Obama’s in-it-together point is mildly offensive in context because it is used to imply that top-earners who resist paying an even larger portion of America’s tab do so only because they are in the grip of an absurd myth of self-reliance.

Together with a bit of simple democratic mathematics, the facts about the portion of tax revenue contributed by the rich plausibly suggest that they pay more than their fair share for the infrastructure of capitalism. The rich have money, which can buy political influence. But the middle class have votes, which in a democracy is influence. So it’s not surprising that the public goods upon which the middle class equally depends are financed disproportionately by the wealthy. Of course, no one ever got elected by identifying middle-income voters as the free-riding class. Asking the minority who already finances rather more than most government expenditure to “give something back”, as if it were currently skating by unfairly on the more open-handed spirit of the less privileged, is plain, old-fashioned demagoguery. That’s only to be expected, but it’s healthy to see it for what it is…

Mr Obama’s notion that the rich get more out of our common institutions than they put in is questionable, to say the least. And his suggestion that opposition to higher top income-tax rates could only be based on by-the-bootstraps social atomism is a silly bit of bad faith.

Well, it’s campaigning, that’s what it is. My suspicion, however, is that Obama has operated in an intellectual bubble for so long that he might actually believe what he is saying here. Now that would be alarming (but not offensive, not even mildly).

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