President Obama yesterday argued that:
As a country that values fairness, wealthier individuals have traditionally born a greater share of this burden than the middle class or those less fortunate. Everybody pays, but the wealthier have borne a little more. This is not because we begrudge those who’ve done well—we rightly celebrate their success. Rather, it is a basic reflection of our belief that those who have benefitted most from our way of life can afford to give back a little bit more. Moreover, this belief has not hindered the success of those at the top of the income scale, who continue to do better and better with each passing year.
I am sure that I am not the only one who is getting tired of hearing the president misleadingly argue that today, unlike before the Bush tax cuts were implemented, the country’s top earners pay a share of taxes that is lighter than it should be. The president must know that that the top 1 percent of taxpayers already pay 38 percent of federal income taxes (before payroll taxes) and the top 10 percent pay 70 percent.
And remember, the top 10 percent isn’t the so-called rich that the president would like you to have in mind. As my colleague Jason Fichtner told me yesterday, “A tax return with an Adjusted Gross Income of $114k would be in the top 10 percent. That means that a teacher and a cop each making $60k married to each other and filing a joint return would be in the top 10 percent.” He added:
Also, from an equity standpoint, the ‘tax burden’ as a share of total federal income taxes for the wealthy is near its highest in decades. For the top 1 percent, the tax share reached a high of 40.42 percent in 2007 but a low in 1987 of 24.81 percent. The top 1 percent paid less of the total share of taxes during the Clinton years. If President Obama wants to go back to the Clinton days, the middle-class and the poor will have to pay more in taxes.
Also, while we may disagree about how much money the rich should pay in taxes and how heavy the burden on them should be, I think we can all agree that the last thing the government should be doing is subsidizing them. That means that the president should have at the top of his to-do list abolishing corporate welfare, ending farm and high-speed-rail subsidies, ending subsidies for NPR, opera houses, and museums, and more.
With that in mind, I fully support the plan put forward by Thomas Sowell in these pages on April 12. He explains:
My plan would start by cutting off all government transfer payments to billionaires. Many, if not most, people are probably unaware that the government is handing out the taxpayers’ money to billionaires. But agricultural subsidies go to a number of billionaires. Very little goes to the ordinary farmer. Big corporations also get big bucks from the government, not only in agricultural subsidies but also in the name of “green” policies, in the name of “alternative energy” policies, and in the name of whatever else will rationalize shoveling the taxpayers’ money out the door to whomever the administration designates — for its own political reasons. The usual political counterattacks against spending cuts will not work against this new kind of spending-cut approach. How many heart-rending stories can the media run about billionaires who have lost their handouts from the taxpayers? How many tears will be shed if General Motors gets dumped off the gravy train? It would also be eye-opening to many people to discover how much government money is going into subsidizing all sorts of things that have nothing to do with helping “the poor” or protecting the public. This would include government-subsidized insurance for posh and pricey coastal resorts that are located too dangerously close to the ocean for a private insurance company to risk insuring them.