Bad for the Economy: The “Buffet Rule” would raise taxes on small business owners and investments during the worst unemployment crisis since the Great Depression.
Bad for Taxpayers: If used solely for deficit reduction, the revenue expected to be raised over 10 years by the “Buffet Rule” would have decreased February 2012’s deficit by a mere 20%.
In order to get our deficits under control, we must stop spending money we don’t have. We are facing a deficit and debt crisis because we spend too much, not because we tax too little. Our nation is in an historic debt and deficit crisis that threatens to leave future generations worse off than their parents. We are not in this situation because the government is taxing too little; we’re here because Washington is wastefully spending far too much. From 2008 ($2.982 trillion) to 2013 ($3.803 trillion), government spending will have grown by $820 billion or 27% under President Obama. Over the next ten years, the president’s budget would increase the size of the federal government by 53%. It’s no surprise the president has racked up more debt in a little over three years than President Bush did in eight.
The “Buffett Rule” would increase taxes on small businesses during the worst unemployment crisis since the Great Depression. With unemployment above 8% for 38 consecutive months under this administration’s failed policies, President Obama is proposing a tax increase on investments and small businesses at the worst possible time. Does the president think it’s fair to punish those taking risks and investing in our economy in order to pay for more failed stimulus veiled as Washington “investments?”
The “Buffet Rule” would not reduce the deficit and would do nothing to stop President Obama’s runaway debt. According to the Joint Committee on Taxation (JCT), the “Buffett Rule” tax increase would raise tax revenue by $47 billion over ten years, or 0.1% of what the government will spend over the next decade. The tax increase will do virtually nothing to reduce short or long-term deficits:
The “Buffett Rule” would increase taxes and reduce the private investments that our economy needs to grow. Capital gains and dividend income are currently taxed at a lower rate than regular income in order to reduce double taxation and encourage crucial investments in our struggling economy. The “Buffett Rule” would drastically increase taxes and discourage private investment in order to provide more failed government spending.
The President wants to use this tax increase for more failed stimulus, not to reduce the debt. President Obama made it very clear that the revenue from this new tax increase would not be used to reduce our unsustainable deficit, but to pay for more failed Washington stimulus. The president repeatedly said that these tax increases would be used to pay for “expanding our investment in clean energy” and other failed stimulus that the president now prefers to call “investments.” The president says that taxes are unfairly low, but is it fair for the president to increase taxes on small business and investments—thereby destroying jobs—to pay for more of the same failed government spending?
The wealthiest Americans already pay a far higher share of taxes. According to the Tax Foundation, the top 1% of all earners in the U.S. pay 36.7% off all federal income taxes but earn only 16.9% of all income. According to the Wall Street Journal, “IRS data show that middle-class workers on average pay just under 15% of their income in federal taxes, while the richest 0.1% pay almost twice as high a rate on average, or 26%.” The president is now trying to say that this is somehow unfair.
Even if we taxed millionaires at 100%, we would still have record deficits: According to the most recent IRS data, 236,000 people reported income above $1 million and their returns amounted to $727 billion. If the government were to take 100% of the adjusted gross income of people making $1 million, the FY 2011 budget deficit would still be $569 billion—that would still be higher than any deficit before President Obama took office.
For more information or questions please contact Andy Koenig at 6-2302.