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John Steele Gordon on taxes and Buffett BS.
… According to Buffett’s article in the New York Times last August, he pays far less in taxes than the working stiffs in his office:
“Last year my federal tax bill — the income tax I paid, as well as payroll taxes paid by me and on my behalf — was $6,938,744. That sounds like a lot of money. But what I paid was only 17.4 percent of my taxable income — and that’s actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent.”
If Warren Buffett submitted a filing at the SEC this dishonest, he’d be in big trouble. But, since this fits the party line, the president took it as gospel, and the mainstream media has carefully refrained from asking any inconvenient questions. (h/t Powerline).
By conflating payroll (FICA) taxes and income taxes, Buffett is playing the intellectual equivalent of three-card monte. FICA taxes are collected only on wages, to a limited amount, in order to provide a limited income in retirement. Technically, they are not taxes at all, but “contributions,” (although I wouldn’t recommend deciding not to contribute). The fact that the federal government commingles these contributions with general revenues in order to make the federal deficit look better is a disgrace. Since Buffett’s income comes overwhelmingly from investment income and he is one of the richest people in the world, of course the people working for him in his office pay a higher percentage of their incomes in FICA taxes. …
James Pethokoukis blogs on just how progressive the US tax system is.
And Pethokoukis writes on 11 things the president neglected to tell us in SOTU.
1. The top 1 percent pay 36.7 percent of federal income taxes and earn 16.9 percent of adjusted gross income (as of 2009).
2. The top 0.1 percent pay 17.1 percent of taxes and earn 7.8 percent of adjusted gross income.
3. The average income tax rate for the top 1 percent is 24 percent. The bottom 50 percent? Just 1.85 percent.
4. The bottom 50 percent pay just 2.3 percent of income taxes. …
Jennifer Rubin says Romney’s rate of taxation and charitable giving is 42% of his income. Saint Barack gives only 1%. Or course he pays a higher rate.
… Another way of looking at it is that in 2011 the Romneys paid out 42 percent of their income in taxes and charity. Here’s how I got there: Total tax (line 60) + foreign taxes (line 47) + state taxes and real-estate taxes + other taxes (Schedule A, line 9) + charitable contributions (Schedule A, line 19) divided by Adjusted Gross Income (1040 line 37).
Let’s compare this percentage to that of average Americans. A 2009 Urban Institute study found: “The average charitable contribution per return filed in 2009 was about 2.0 percent of [adjusted gross] income.”
As for the effective marginal rate, Jim Pethokoukis writes: “While Romney’s tax rate is — in his own words — ‘probably closer to 15 percent than anything,’ that’s still higher than the 8.2 percent average effective income tax rate (as of 2010) of U.S. households (once you factor in various tax credits). Indeed, nearly half of U.S. households pay no income tax at all. Their average effective tax rate is actually negative. Even if you add in the payroll tax, the effective tax rate of the middle fifth of U.S. taxpayers is 12.8 percent.”
So, yes, Romney is much wealthier than most Americans. But he also gives away or pays in taxes in absolute and percentage terms far more than most Americans. …
Back to Pethokoukis who says it is fair to compare the weakness of Obama’s recovery to the strength of Reagan’s.
Ronald Reagan inherited a Long Recession. The economy declined 0.3 percent in 1980, grew at a subpar 2.5 percent in 1981, and then plunged 1.9 percent in 1982. The lengthy downturn was really the culmination of more than a decade of bad economic policy. But the Reagan Recovery was stunning. GDP rose 4.5 percent in 1983 and 7.2 percent in 1984. It was Morning in America, and Reagan won reelection by a landslide.
Barack Obama also inherited a Long Recession. According the National Bureau of Economic Research, the U.S. economy entered recession in 2007 and stayed there until June 2009. But the Obama Recovery has been terribly weak. The economy grew at a 2.8 percent pace in the second half of 2009, 3.0 percent in 2010, and — according to new Commerce Department data – 1.7 percent in 2011. We’ll see what happens in the 2012 election, but Obama’s current approval rating is 43 percent, according to Gallup.
As economist Lawrence Kudlow of CNBC notes:
After 10 quarters of recovery, the Reagan growth rate was 6 percent. Compare that with Obama’s 2.4 percent. Or compare Obama’s 2.4 percent with the 4.6 percent post-World War II average recovery rate after 10 quarters.
But Obamacrats and other liberals say the Reagan-Obama comparison is unfair. After all, Reagan didn’t have to deal with a collapsed housing bubble. …
Speaking of the housing bubble mentioned in the pull quote above, it is instructive to remember one of the few times Barack Obama has taken a stand was when, on July 6, 1994, he sued Citibank for not loaning enough to minorities. So, the great loan and housing collapse of ’07 and ’08 was in part caused by a lawsuit filed by Barry Obama. MediaCircus had a post on the story in 2008.
Do you remember how we told you that the Democrats and groups associated with them leaned on banks and even sued to get them to make bad loans under the Community Reinvestment Act which was a factor in causing the economic crisis (see HERE ) … well look at what some fellow bloggers have dug up while researching Obama’s legal career. Looks like a typical ACORN lawsuit to get banks to hand out bad loans.
In these lawsuits, ACORN makes a bogus claim of Redlining (denying poor people loans because of their ethnic heritage). They protest and get the local media to raise a big stink. This stink means that the bank faces thousands of people closing their accounts and get local politicians to lobby to stop the bank from doing some future business, expansions and mergers. If the bank goes to court, they will win, but the damage is already done because who is going to launch a big campaign to get the bank’s reputation back?
It is important to understand the nature of these lawsuits and what their purpose is. ACORN filed tons of these lawsuits and ALL of them allege racism.
Thanks to the IUSB Vision Weblog for providing additional details of this story.
We pulled the docket down, but here’s a brief for your summary: …
NY Post OpEd examines the shortcomings of the 2009 stimulus and explains . . .
… Things could have been different.
The incoming administration could have led more from the outset to ensure the stimulus was quicker, more targeted and written with Republican support. The president and his aides could have tackled criticism head-on instead of letting it fester.
In explaining the stagnant economy, President Obama has said that the recovery was trammeled by the European debt crisis, rising gas prices and the impact of the Japanese earthquake on the supply chain. But if the stimulus had been designed to generate more thrust on the front end, the American economy might have been in stronger shape to withstand these headwinds.
Others say that businesses are scared stiff with uncertainty and a lack of confidence. It might not be this way if the president and congressional leaders had focused on long-term infrastructure and energy bills instead of health-care reform. Health care was one of the few growing sectors during the recession. And by setting Congress down one of the most divisive policy paths, the administration was left with an atmosphere in which everything the president proposed, including ideas that Republicans supported in the past, were now considered radical and corrosive.
The stimulus money wasn’t enough to transform American infrastructure, the education system or the energy sector. But it was just enough for Republicans to be able to say, “We tried that already.”
Despite the historic investments in the stimulus, there seems little chance landmark bills to continue the programs will pass. Left with only a down payment on his major initiatives, Obama now faces a tough election and may end up like many of the homeowners who ran out of money during the Great Recession.