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On April 16, the Democrats will broadside their political rivals in the Senate by forcing a vote on the so-called Buffet rule, a proposed bill that would raise the minimum tax rate to 30 percent for Americans earning at least $1 million a year.
Let’s ignore the fact that a minute 0.1 percent of Americans are in the million-dollar club and that, out of that 0.1 percent, the Buffet rule would only affect about 4,000 taxpayers. Let’s ignore that the bill would likely have a negligible effect on the U.S. economy and that it has no chance of passing Congress this side of the Rapture. The conservatives are content in pointing out that Senate Majority Leader Harry Reid’s move is mostly symbolic, a political feint.
The conservatives are right this time, but let’s ignore that.
Let’s not, however, ignore the symbolism. What the Democrats are trying to do is draw a clear distinction between progressivism and conservatism in 2012. The party’s message to the voters basically reads: the party of fairness.
Conservatives argue that any attempt at fairness by “soaking the rich” – raising taxes on their income, including capital gains – would discourage the wealthy from investing in the market (which, according to them, creates jobs) and from investing in their own companies (which, according to them, creates jobs).
There’s one thing that topples that argument: history.
Looking at the upper marginal tax rates in the past century, we see that the U.S. government has usually taken responsible action during war and raised taxes on the rich – something it didn’t do while Bush waged (and charged) two wars simultaneously.
During the First World War, the tax rate for top earners jumped from 15 percent to 77 percent in a matter of three years. What followed was a decade of hubris and deregulation, followed by – as if on cue – economic depression.
And what happened during the Great Depression? You guessed it: the top rate went from 24 percent in October 1929 to 79 percent 10 years later. The rate even got as high as 94 percent during the Second World War because, well, victories don’t grow on trees (or in gardens, for that matter).
You can imagine the charges they’d throw at the president today if he proposed any tax rate higher than 35 percent.
The rate during the Eisenhower administration of the 1950s – lovingly considered the “Golden Age of Capitalism” – was a laissez-faire 91 percent. Ponder that tonight when you’re taking the expressway home to your cozy suburb – both products of the ‘50s.
When Armstrong walked on the moon in July 1969, the wealthiest Americans were being taxed at 77 percent.
As the tax rate began to come down – and the nation began abandoning Keynesian economics – the good times drew to a close. Reagan’s wealthiest were taxed at 50 percent; Clinton’s, 39 percent.
Then America waged two prolonged wars and did the unthinkable: gave tax cuts to the richest Americans. What followed was corollary.
Taxing the rich to pay for war and pull the nation out of recession is not only the fair thing to do; as it turns out, it’s also the American thing to do.
About Hector Luis Alamo, Jr.
What a dumb article. It gives 20 facts and then tells you to ignore them. Ignore all the facts and pay attention to the “symbolism.” In otherwords, forget the stuff that doesn’t support my point while I spin the story to support my argument. Glad congress has nothing better to do that argue over “symbolism.” Too bad symbolism doesn’t pay bills.
Man Buffet is not even paying his taxes….have you heard that he wants to sue the IRS.
Maybe we should just quit getting into so many wars
On buffet paying taxes, I always wondered if he thought he should pay a higher rate then why does he shelter money into charitable foundations instead of just giving it to the government.
Taxing the rich doesnt help. you need to stop taxing the rich, the middle class and poor. Federal taxes is the problem, get rid of this illegal income tax and the IRS and immediately there will be a boost to the economy
Stop all taxes. Sounds good. We don’t need roads, public education, police protection and firefighters anyway. While we’re at it, let’s cut all social services entirely! Save us a boat load of tax money! Military? Who needs em? No one will attack us! *insert sarcastic tone here*
Nelson. obviously you cant read. I said Federal Taxes, no one ever said anything about all taxes. if you know anything about the federal income tax and the IRS you will know that its unconstitutional, also none of the federal taxes ever come back into the system for the roads and stuff you speak of. and we need to get rid of the federal program for schooling. its a mess, yes eventually get rid of SS, its a socialist program. and no one will attack us.. but only fools believe what they are told
maybe somewhere in the middle. like a military focused more on nationol defense rather than offense and defending the world. keep police and fire. pass off education and other social services to private non profits or local goverment
The law will mean nothing without closing the loop holes. Get rid of all the loop holes and institute a flat tax that everyone will pay.
“Americans aren’t going to turn away from the Buffett Rule just yet, even if it’s a political gimmick. A Gallup poll from Friday showed that 60 percent of Americans support the concept, and among independents, that number rose even higher, to 63 percent.”: http://www.theatlantic.com/politics/archive/2012/04/buffett-rule-heads-to-a-vote-nears-end-of-its-legislative-life/255931/
i’m not for Wealth redistribution, but at the same time I am not for paying 28% Fed Income Tax, while the Rich get away with paying 14% on Millions of Dollars…that’s Bull-ish.