Wow. Seriously, Chris Cillizza and Sean Sullivan? Seriously??
The article, titled “Mitt Romney was right (on taxes),” chastises the public for hypocrisy in believing, on the one hand, by wide poll margins, that people should do whatever they can to legally reduce their taxes as much as possible, yet on the other hand disapproving of politicians (especially wealthy ones) doing exactly that. These writers use two examples: the respective cases of Mitt Romney and Barack Obama, the latter who just released his newly-filed tax returns for last year showing that he and his wife paid federal income taxes at a rate of 18.4%.
About Romney, they write:
The two-time presidential candidate, whose considerable wealth made the release of his tax returns a focal point of the 2012 campaign, insisted that he paid what was required but no more.
Eighty-five percent of the American public should have agreed with Romney. But, of course, they didn’t. Romney was cast as trying to game the system for the benefit of he and his wealthy friends. In a February 2012 Washington Post-ABC News poll, two in three Americans said Romney did not pay his fair share of taxes (the public was split over the question in the fall). And a majority of voters in the 2012 exit poll said that Romney’s policies would generally favor the rich and he lost that portion of the vote overwhelmingly.
About Obama, they say, “The Drudge Report, a popular conservative-leaning aggregation site, quickly went with a banner expressing incredulity at the 18 percent rate. Conservatives on twitter were similarly disgruntled.” As if it’s the general public rather than the far-right starve-the-beast crowd that’s shocked. And as if it’s even clear that the Drudge Report writer’s incredulity is about Obama’s paying only the legally required amount rather than the lowness of the legally required amount. The headline, which is not attached to a story, best as I can tell, but instead simply links to the Wall Street Journal news report about Obama’s tax return, reads, “Obama only pays tax rate of 18%?”
Well, yes. That’s what Obama is actively trying to change: the lowness of the federal income taxes paid by the wealthy.
It’s also a safe bet–even safer than, say, betting on Berkshire Hathaway stock–that Warren Buffett has never had a retirement-savings account in a Cayman Islands bank that has between $20 million and $120 million (or the deflationary equivalent) in it, achieved almost certainly by stated initial gross devaluation of equities placed into the account. And that he did not avail himself of the IRS’s 2009 tax amnesty program for people who were shielding income from the IRS in Swiss banks because he did shield income from the IRS in Swiss banks. Romney likely did both, which probably is why he refused to release to the public tax documents that would dispel those inferences. The only other reasonably possible motive for his failure to release those documents is that they would have highlighted the outrageousness of legal tax loopholes that Romney did not want to draw attention to–also a possibility, although, I suspect, not the actual, or at least not the predominant, one), but in any event not one that supports these journalists’ characterization of the public’s poll responses as hypocritical.
What’s really remarkable, in my opinion, is that at least one of these two Washington Post political writers, one of them very high-profile–and as a regular reader of their blog, The Fix, I suspect it is Cillizza, the high-profile one, rather than Sullivan–thinks that a poll question using the phrase “pay their fair share of taxes” references not preferred tax policy but instead actual, current tax policy. The poll question almost certainly was intended to reach, and was understood by the poll respondents to be asking, about the voter’s preferred tax law, not about how the voter thinks people should act, by choice, under current, existing tax law. With the caveat, of course, that most people don’t think wealthy people such as the Romneys should violate tax law, as many, many people who followed the specifics of the Romney-tax-returns controversy last year did conclude.
There is, in other words, nothing even slightly hypocritical in believing that people are morally entitled to avail themselves of legal tax breaks but that tax law should be amended to remove some of those tax breaks, to raise tax rates on the wealthy, to tax investment income at the same or near-same rate as investment income, and to tax large estates. Or to do at least some of these things.
The belief that the law in its current form does not exact payment of a fair share of tax revenues from the wealthy, and the belief that it’s fine for people to employ current tax law to lower their own taxes, irrespective of their views on what tax policy should be, are not contradictory. Unless, like one or both of these journalists, you think the phrase “fair share of taxes” means two distinct and contrary things at once. But most people, I’m pretty sure, understand quite well what that phrase addresses. And it’s only one of those two things, not both.
What is hypocritical is to argue for low taxes for “job creators” and then be shocked that they are that low, but this is largely a difference between pundits and public. Self appointed leaders are shocked when the followers don’t follow.
Myself, I think it would be a much stronger argument if those rich people who are calling for higher taxes on rich people actually paid higher taxes voluntarily.
There is an account called “Gifts to the United States” and you can just send them a check.
Those who do so, well, I’ll be convinced that they really mean that they, themselves, should pay higher taxes when they do so.
Last time I looked (back in 2006) this account got mebbe $3 million a year.
Not all that many people seem to really want to pay higher taxes……
Really, Worstall? Not all that many people seem to really want to pay higher taxes, and you know this because they don’t unilaterally donate gifts to the U.S. Treasury? No matter that many, many people voted Democratic in this past election and in 2004, 2006, 2008, and 2010–for president, for senate candidates, for House candidates–knowing full well that the candidates they voted for were proposing tax increases for them and that the Repub candidates were proposing lower taxes for them? And no matter that many high-profile wealthy people, including Obama, Bill Clinton, Buffett, and some Silicon Valley zillionaires–have been outspoken on the subject, and many, many others donated lots of money to these candidates?
So what’s next, Tim? If the sun rises tomorrow, you’ll say it’s because John Boehner and Mitch McConnell are holding down the congressional fort? After all, actual evidence of cause and effect doesn’t seem high on your list of prerequisites to conclusions you draw. Next time David Brooks goes on vacation, you could ghostwrite his column for him; you have his modus operandi down pat.
It’s a basic economic concept: revealed preferences. Look at what people do not what they say.
Peopple have the option to pay higher taxes. So, do they? Apart from a very few, no, they don’t. Therefore, clearly, people are not actually paying higher taxes despite that opportunity to do so.
It is legitmate to draw a conclusion from that fact.
Ah, Tim,
Yours is the tedious argument of a middle school boy. What grown-ups understand is that voluntary contributions will not have a significant effect on the federal budget. What grown-ups understand is that only by mandatory tax increases can a serious dent be made in the federal budget.
The actual point here is that many people support raising taxes on themselves and all others like themselves because they know it will be fair and will make a difference. The fact that they don’t simple make a solitary donation in that same amount show that they understand that wouldn’t be fair and would not make a difference.
Hope that helps.
Yes, Tim. Look at what people do–such as voting for, and donating money to the campaigns of, Dem candidates who campaign on policy proposals that would increase their own taxes, and who vote against Repub candidates who promise to lower their taxes.
Spot-on, Joel. Except for the part where you say your explanation might actually be understood.
Well, Tim see what company you have placed yourself in. those “basic economic concepts” may not be all they are cracked up to be in sophomore economics.
Joel, you make the tedious argument of a grade schooler. No one is suggesting that voluntary contributions would fix the revenue problem, only that it would help. It would also indicate to the rest of us that the pro-tax rich are serious about their claims that they are undertaxed. In other words, the pro-tax rich should voluntarily contribute funds to the Treasury to demonstrate their sincerity. I won’t hold my breath.
True, there is no hypocrisy in favoring higher taxes while paying taxes at the current, lower rates. However, if wealthy pro-taxers really wanted to gain converts, they would set an example by voluntarily contributing additional monies to the U.S. Treasury. They never do this. Also, one could argue that when a pro-tax rich person claims a contribution deduction on his tax return he is, in fact, shifting monies from the public to the private sector, something he claims to be against. If he truly thinks government spends money more wisely than private charity, why take the deduction? Wouldn’t it be MORE charitable to give the money to the feds? They never do this, either.
I don’t know why voluntarily contributing tax payments is presented as the proof of people wanting higher tax rates on themselves. It’s a clever position to hold, yet ignores the realization that people are not stupid.
When everyone is benefiting from an action, contributing voluntarily to increase that action beyond the mandate of all contributing only assures those who want to contribute less benefit more and thus achieve their lessor contribution.
Now, maybe those who don’t want higher taxes think those who do are so stupid they will fall for such an argument. Ha!
The real proof of the wealthy wanting higher taxes because they understand the benefits to society in whole is found in where they put their political money and how much. When I see Warren Buffet et al dancing on the political/public floor as the Koch’s are dancing then I’ll take their claims of concern of the need for higher taxation seriously.
Otherwise, as usual it’s the 99% having to do the heavy lifting via physical campaigning to save the wealthy from themselves as only the wealthy “tax me more” group has the money to get on that dance floor.
Dan, I’d love to see Buffett or Soros or any of the others establish some vast apparatus similar to the Koch political-octopus setup, but what the Kochs have done has taken many years and is really incredibly diabolical in its operations and infiltrations. Buffett, Soros and many others do contribute very substantially to Dem campaigns, and they make high-publicity statements and arguments about their positions on tax and fiscal policy. I don’t think it’s fair at all to suggest that they don’t mean what they say and aren’t doing heavy lifting on this.
There also are many other very wealthy people who have done some heavy lifting on this. one that comes to mind is Bill Gates Sr., who has been very outspoken about it. But there are many others who are not names known to the public who have, too. One of my neighbors growing up, who is a former top-level person at Goldman-Sachs (pre-major-controversies) and who is now the head of a large (untainted-by-scandal) hedge fund, is among them.
Go to any upscale suburb or city neighborhood during an election season and you’ll see lawn signs and the like in front of the houses of people whose taxes would rise if the candidates they’re actively supporting won. Do you doubt their commitment?
The gut-wrenching stories about the family of the little eight-year-old boy killed by one of the bombs in Boston on Monday (his mother and sister were very seriously injured) makes pretty clear that this family is quite upscale–and also that the family is involved in liberal political causes. Here’s betting that the parents donated to Obama’s and Warren’s campaigns last fall in more-than-trivial amounts.
Bev,
I do get that the wealthy are contributing. It’s obvious in the fund raising reports.
However, somewhere along the way there has to be a counter apparatus to the right’s system. I think what Dean did for the dem’s was approaching it in a people’s way, but it appears the DLC’s/Obama machine was not looking to really let the “people” be more than workers.
Political campaign contributions for progressive/liberal/dem politics are only countering the campaign contributions for conservative/regressive/repub politics. That leaves the Koch like apparatus money unchallenged.
Howard Dean’s approach if it had been solidified and made part of the Dem’s DNA had the potential to challenge this other apparatus.