True Math on "Buffett Rule"

It's back, friends. President Candidate H. Obama has brought back his class warfare (and ultimately foolhardy) "Buffett Rule."  It's a surtax to be levied on any American whose income is over $1 Million per year.

Aside from the humorous fact that the proposal's namesake, Warren Buffett, wouldn't actually fall under the rule (his annual salary is only $100,000 per year), there is a serious mathematical and logical hole in Obama's premise: IT WON'T HELP THE PROBLEM ONE IOTA!

The problem to solve is the Federal deficit, right? Our federal deficit in 2012 is projected to be over $1.3 Trillion. The Buffett Rule would raise only $47 Billion...not a year (which would only close a measly 3.6% of the deficit if that was the case)....but over TEN YEARS!  Translation? This is 1/600 OF 1% of the deficits over the next ten years if the President has it's way! That's 0.001666667% of the deficit. To put that in real terms, that's like telling a person earning $50,000 per year that they will receive a raise of $84.00 a year.  That translates to roughly $1.60 more per week before taxes. (Congratulations. Your hard work has earned you the ability to purchase an extra 3 Musketeers each week...don't skimp, get the king size bar...you've earned it.)

That was the point of the Buffett Rule, at first, was to close the deficit?  Ooops, that won't work.  Perhaps this is why the Left has changed their entire argument to "fairness." It's not fair! (Waaa!  Waaa! Waaa!)  Yet isn't it funny that these same people who are obsessed with fairness are the same people who throw a fit when the fairest possible tax option, a flat rate tax (whether on income or consumption) is proposed.  Because it the goal is parity, and parity is apparently paying the same rate, why isn't it parity when the Middle Class has their rate reduced?

There is also another huge fallacy in this point:  Income and Capital Gains are taxed differently FOR EVERYONE. Middle Class individuals who buy stock and make investments pay the same Capital Gains rate as a millionaire. Ooops...are my facts getting in the way of talking points AGAIN? 

The bottom line on the Buffett Rule is this: 1 - It won't impact the deficit in any real way. It's the equivalent of pennies.  2 - Despite Obama claiming the Buffett Rule "is not class warfare," OF COURSE IT'S CLASS WARFARE! If it isn't about reducing the deficit, what else can you call it?

This is just another page out of the pamphlet that is the Liberal Playbook. Since Obama can't defend his own policies as intelligent and useful, he has to bring up class and "fairness" (and for some reason names it after a man who is fighting the IRS over paying over $1 Billion in back taxes he owes...I guess that's not part of Buffett's "fair share").  And THIS is supposed to be hard to defeat in November? I think not.



Dissecting the Liberal Talking Points: No, Jesus Wouldn't Support the Buffet Rule

It's campaign season, so President Obama's ridiculous rhetoric has gotten something of a pass recently from me. Then he tried to claim Jesus supports liberalism, and it was time to dust off the old "dissecting the liberal talking points" header.

On February 2nd, if you haven't heard already, President Obama claimed that Jesus would support the Buffet Rule, quoting Luke 12:48b, "To whom much is given, much is required."  Unfortunately for the President, like most of his theology, he is incorrect in this false use of scripture.

For one, this passage is about salvation and the requirements of believers to behave as believers, specifically saying that we as Christians ought to behave as followers of Christ, always ready for Jesus to return so that our Lord will find us about His business when he comes back:

And the Lord said, “Who then is that faithful and wise steward, whom his master will make ruler over his household, to give them their portion of food in due season? ⁴³ Blessed is that servant whom his master will find so doing when he comes.  Truly, I say to you that he will make him ruler over all that he has. But if that servant says in his heart, ‘My master is delaying his coming,’ and begins to beat the male and female servants, and to eat and drink and be drunk, the master of that servant will come on a day when he is not looking for him, and at an hour when he is not aware, and will cut him in two and appoint him his portion with the unbelievers. And that servant who knew his master’s will, and did not prepare himself or do according to his will, shall be beaten with many stripes. But he who did not know, yet committed things deserving of stripes, shall be beaten with few. For everyone to whom much is given, from him much will be required; and to whom much has been committed, of him they will ask the more.  - Luke 12:42-48

This passage specifically is saying that Christ expects more out of Christians because we have been blessed to know the truth and we should walk in it.  It has absolutely nothing to do with taxes, or government.

Secondly, God did have a tax system.  The Tithe.  It was a FLAT TAX not a progressive tax.  As I wrote in my Treatise on Biblical Conservatism:

 God requires the tithe of all your increase (that's money gained for those of you from Palm Beach) of all his people.  He does not require 10% from the poor, 15-20% from the middle class, and 35% from the wealthy.  Here is what God says in Deuteronomy.

"You shall truly tithe all the increase of your grain that the field produces year by year. And you shall eat before the LORD your God, in the place where He chooses to make His name abide, the tithe of your grain and your new wine and your oil, of the firstborn of your herds and your flocks, that you may learn to fear the LORD your God always."  Deuteronomy 14:21-23
There was no "millionaires surtax" in the Bible.  There was not an increased requirement for giving from the wealthiest.   The rate was the same for all.

Furthermore, there is a major issue with Obama's entire logic.  Nowhere in the Bible is there any statement that the government should take care of the poor.  Rather, it was clear that it was up to the individual to do it.  Again, from my Treatise on Biblical Conservatism:

In Deuteronomy, we are given instructions on giving to the poor:

If there is among you a poor man of your brethren, within any of the gates in your land which the LORD your God is giving you, you shall not harden your heart nor shut your hand from your poor brother, but you shall open your hand wide to him and willingly lend him sufficient for his need, whatever he needs. Deuteronomy 15:7-8

The instruction here is clear.  If there is someone who is in need and you are capable of providing for that need, YOU DO IT.  Jesus gave the same requirements for providing for that need, YOU DO IT.  Jesus also made it clear that He would reward His children for caring for the poor THEMSELVES:

Then the King will say to those on His right hand, "Come, you blessed of My Father, inherit the kingdom prepared for you from the foundation of the world: for I was hungry and you gave Me food; I was thirsty and you gave Me drink; I was a stranger and you took Me in;  I was naked and you clothed Me; I was sick and you visited Me; I was in prison and you came to Me."
Then the righteous will answer Him, saying, ‘Lord, when did we see You hungry and feed You, or thirsty and give You drink? When did we see You a stranger and take You in, or naked and clothe You? Or when did we see You sick, or in prison, and come to You?"

And the King will answer and say to them, "Assuredly, I say to you, inasmuch as you did it to one of the least of these My brethren, you did it to Me."  Matthew 25:34-40

Nowhere in here does Jesus say "you paid taxes and your government cared for the people."  He says "YOU fed me" and "YOU clothed me."  YOU DO IT.  As a matter of fact, Jesus told us in Matthew that He sees caring for the poor as precisely the same as caring for Him!  Again, Mr. President, it's not about government caring for people.  Compassion exists in more than just government spending.  There are better, more efficient ways to take care of the needy.  Like private charities.  The conservatives that you rip as being evil and heartless have consistently out-given you supposedly compassionate liberals.  That's because conservatives are compassionate with THEIR OWN money. Let's compare Obama's charitable giving to the "evil, greedy Republican" Mitt Romney. 

According to the Obama Campaign, President Obama gave about 6% of his income in the two years before he became President to charity. Vice President Joe Binden gave a pathetic .15% of his income in 2006. 

Now according to the Romney Campaign, In 2010 and 2011, Romney gave an average of over 16% of his income to charity. 

Finally, let's take an average, middle-class conservative, hardworking single adult. Me.  Without diving into too much detail because I do believe my giving is between myself and my Lord and Savior Jesus Christ, I will say unequvically that I also gave a larger percentage of my income to charity (primarily via my church, which uses that money to give to missionaries and Christian charitable organizations throughout the world) than candidate Obama did.

So, Mr. Obama, who is the compassionate one?  I say it is the person who gave nearly 3 times as much of his own money away as you did, not the one who wants to be generous with everyone else's money.  Then again, I personally believe that "to whom much is given, much is required," with my own money, and not other people's money.

Dissecting the Liberal Talking Points: Warren Buffett is the Exception, Not the Rule

In Monday's Deficit Reduction speech, Obama proposed a "Buffett Rule" based on Warren Buffett's paying less taxes than his secretary. There are so many issues with that claim, and I'm pleased that the nonpartisan Tax Policy Center crunched the numbers and found the falseness in the claim. 

First and foremost, there are the facts:  Individuals who make $1,000,000 will pay approximately 29.1% in taxes after deductions, while those making $50,000-75,000 will pay 15%.  These are the IRS numbers friends.   According to an AP article on this subject:

On average, the wealthiest people in America pay a lot more taxes than the middle class or the poor, according to private and government data. They pay at a higher rate, and as a group, they contribute a much larger share of the overall taxes collected by the federal government. (1)

So the wealthy actually pay significantly more taxes, both in a percentage and in net dollars. And again, before the Left starts gumming about "fair share" the wealthiest 10% pay 50% of the taxes. The only people who don't pay their fair share are the people who pay 0% in taxes and receive the majority of the benefits that are coming out of taxes from the rest of us who do pay taxes, but I digress.

The entirety of this argument is based upon a misunderstanding of taxes and tax rates. Perhaps Warren Buffett doesn't pay his full tax rate, but that's because he's pretty good at using the legal system (note: they aren't "loopholes" they are legal deductions and tax shelters) to reduce his tax payments. For the record, nothing is stopping Buffett from sending more tax money. I know I said it about a month ago, but Mr. Buffett if you want to send more money to the government, the address is:

Department of the Treasury
1500 Pennsylvania Avenue, NW
Washington, D.C. 20220

 This entire argument is centered around a fundamental misunderstanding of taxation. First off, Buffet's annual salary is currently $100,000 (2), well below Obama's $250,000 per year "millionaire." (Apparently the President has STILL not figured out how much money is $1,000,000 and whether or not $250,000 = $1,000,000. For those of you from Palm Beach County, FL, $250,000 doesn't equal $1,000,000.) Secondly, there is a major difference between income taxes and capital gains taxes. 

Income taxes are paid on salary. Salary is guaranteed to an employee from their employer as payment for services rendered. The employee contracts with the employer to provide labor in exchange for those wages. The employer then fulfills their end of the contract with wages. Unless you work on pure commission, your salary is guaranteed. There is no risk. If you are in the top tax bracket, your tax rate on income is 35%.

Now we come to Capital Gains taxes. Now there are huge differences between Capital Gains taxes and Income Taxes. One, there is no guarantee of a Capital Gains situation (that's making money on an investment, for those of you from Palm Beach.) There is also a huge chance that you lose that money. With income there is no chance of losing your money, because a) you didn't invest your money and b) you are guaranteed your paycheck, or else your employer is in breach of contract. Two, and more importantly, that money was already taxed once! It was either taxed as income at up to 35%, or it was taxed as inheritance at either 50%, or at 35%, unless it was inherited in the brief period of time when the rate was 0%, and even if it was, that money was taxed as the deceased's income or capital gains! So any money in a capital gains situation was taxed previously, and then it's taxed again at an additional 15% for being successfully invested.

In conclusion: First of all, very few CEOs are not paying less taxes than their secretary, unless their secretary's salary is more than their own (which is highly possible, since many executive assistants of Fortune 500 CEOs make more than $100,000 per year). Secondly, Capital Gains taxes are different than Income Taxes. Please write this down. Thirdly, even if Buffet does pay less than his secretary, he is the exception, not the rule. And finally, once again, if Mr. Buffet feels he isn't taxed enough that address to send the amount he feels he has under paid is:

Department of the Treasury
1500 Pennsylvania Avenue, NW
Washington, D.C. 20220

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(1) FACT CHECK: Are Rich Taxed Less Than Secretaries?

(2) Wikipedia: Warren Buffett