A few weeks ago, Mr. Buffet, the inestimable stock market oracle freely admitted to the world what many had already known, or at least had suspected, that the rich do indeed pay less tax than the middle class. Now, President Obama is pushing what is being called the Buffet rule or the Buffet tax. This tax would affect any earnings made in excess of one million dollars, effectively making the Buffet tax a tax exclusive to those tax payers who are specifically considered “rich.” In addition, the tax is purported to include an additional tax increase on earnings over 10 million dollars.
One of the biggest arguments against the Buffet tax or the Buffet rule is that it won’t make an exceptional difference in the economy, and is being pushed to do nothing more than garner popular support for the president, whose approval ratings have fallen exponentially due to the perceived mismanagement of the economic crisis. One thing remains true, however. Regardless of whether the tax would do any good or not, it is fair.
Mr. Buffet pointed out in his op-ed piece published earlier in the summer that he had an effective tax rate of approximately 17%, while many of his employees, including his personal secretary, had effective tax rates that hovered above 30%. The loopholes supported by a congress that itself is rapidly leeching popular support from both the left and the right have become traditional parts of the U.S. tax code, a literal mess of bureaucracy that just as often sees tax cheating where tax confusion is more often the problem.
Obama intends to unveil the Buffet tax on Monday, and it’s clear that all the pundits and talking heads will be watching with baited breath, waiting for the opportunity to pounce and say that the new tax won’t do any good, and that the president is wasting time trying to cover up the problems he can’t surmount. That may be true, but there’s no denying that the tax is fair, and long overdue. A congress that refuses to pass it, an idea originally put forth by one of the wealthiest and best-known gentlemen in America, is a congress held firmly in corporate pockets, and not one worthy of reelection.