To understand the workings of American politics, you have to understand this fundamental law: Conservatives think liberals are stupid. Liberals think conservatives are evil. – Charles Krauthammer
It’s interesting to be hated. I’m a white male, married to the same woman for over two decades. We love rescuing animals in the US and working on conservation and health projects in Africa. Together we don’t make enough to qualify for the top 2% of wage earners, but we are uncomfortably close. She works 50+ hours a week in health care, has had her life threatened twice for failing to prescribe narcotics, and daily faces patients who act like their ordering off the ala cart menu at a Chinese Restaurant, “I’ll have the MRI with antibiotics I don’t really need, oh and a side of Vicodin.” I work at a job that I enjoy for similar hours but as a contractor don’t know where I’ll be working from one month to the next. The only job security I have comes from the combination of my skills, wits and luck.
Aside from being white and conservative (libertarian actually) we are hated because we obviously don’t our fair share. Now granted, technically we’re excused from this requirement because we are not part of the minority being mugged, currently set at the top 2% of taxpayers, but I don’t trust technicalities to protect my family. For example the targets of liberal ire initially were the billionaires and millionaires; then it was 1% for awhile before some of the brighter liberals realized that you can’t soak the top 1% and get all the free healthcare and cell phones you need, so it became 2%. How long before it’s 5%? 10%? Anyone with more than anyone else except those who are more equal than me?
Nobel Prize winning Paul Krugman argues that we should bring back the 91% tax rate. Krugman’s argument in essence is that the American economy grew in the 1950s under the tax rate, workers were safely empowered by unions and as a result of both company executives enjoyed modest remuneration. Of course Krugman doesn’t mention other aspects of the 1950s that may have had something to do with prosperity, such as Republican control of Congress and the White House, and its darker side segregation although the treatment of Col. Allen West by the liberal establishment serves as a reminder of that last item. He does mention that the 91% number is a sham though, writing, “The best estimates suggest that circa 1960 the top 0.01 percent of Americans paid an effective federal tax rate of more than 70 percent, twice what they pay today.”
Wait, top .01%? Didn’t he mean 1% or 2%? No, but today we are talking about a minority 200x larger? And no one paid 91% even though it was on the books. Why? For the same reason we’re in a mess today: the tax code is riddled with loopholes and taxbreaks that the average 2%er isn’t privy to or can’t use.
Cats Love Villains: Paul Robin Krugman and Ernst Stavro Blofeld
Contrary to what I may think about Paul Krugman personally, I doubt he’s stupid. While I don’t know exactly how much he earns per year, I would guess it’s in the low millions, putting him the under 1% category, but nevertheless appear on the surface he’s advocating for higher taxes on himself. I’ve wondered this about the Democrat leadership: Nancy Pelosi, John Kerry, Hillary Clinton, all of them are extremely wealthy as are their top-tier supporters, billionaires like Nazi-collaborator George Judenrat Soros, Ian Fleming’s inspiration for Blofeld if Fleming lived today, Warren Buffet and Penny Pritzker. Why are the begging to be coerced to pay more money to the IRS?
It’s because they aren’t.
If Krugman, Pritzker et al truly believed the Federal Government needed their money more than they did they would have handed it over already. There is nothing preventing a them or a anyone of lesser-worth from cutting a check to the US Treasury for 91% of their income. Has Whoppi Goldberg, Opera Winfrey or other members of the Hollywood elite pledged to do this? If not why not?
Because they know that these laws will not impact them. Krugman hints at this when he mentions the “effective federal tax rate of more than 70 percent.” How does one go from a 91% on paper to actually paying 70%? Through deductions and loopholes. How does one find those deductions and loopholes? Well GE CEO and Obama supporter Jeff Immelt knows: he has thousands of tax accountants and lawyers at his disposal who are so good at their jobs they have allowed GE to avoid taxes altogether according to the New York Times. It’s also especially ironic watching a liberal arguing for a return to the “old days” while conservatives are urging tax simplification and the closure of deductions and loopholes, progressive ideas that haven’t been tried before. Up is down, left is right and apparently I am evil in our doublespeak world of Oceania. I haz a sad...
Liberals support these tax rates because they know they won’t be subject to them. They won’t be subject to them because they write the laws and will make sure they won’t. Unfortunately I know that their return to the past will mean paying more for me because I can’t afford to send money offshore or hire an accountant. The money we earn goes quickly and the little that we save usually ends up in the pockets of locals we hire to improve our home.
I have been told, “If you don’t like abortion don’t have one.”* But I can also use the same twisted logic about taxes:
If you don’t want to pay lower taxes, don’t. Don’t waste time collecting receipts to itemize your taxes. Have your employer withhold the maximum, then when tax time comes around, send in a check with an extra 25% of your income. Bask in the afterglow of helping all those less fortunate than you and paying your fair share.
If you like Big Government, stand in line for me at the DMV or for someone else applying for disability at the Social Security office. If you want higher taxes, by all means pay them. But if you don’t want me to tell you what to do with your body, don’t tell me what to do with my money.
UPDATE: Mickey Kaus notes this about Krugman’s 91% figure.
Hmm. Something seems off here. Did this super-rich hundredth-of-the-1% in the ’50s really a) pay anything near those super-high 91% marginal rates, or did they b) employ accountants and loopholes to avoid them (as the conventional tax-reformer wisdom would have it)? If you read Krugman’s paragraph you’d probably conclude (a)–high income tax rates really sock it to the rich! But the truth is closer to (b).
According to this CRS study, that 91% marginal rate produced an effective income tax rate on the top o.o1 percent of only about 45%. Krugman himself appears to be relying on Piketty and Saez–but they come in with an even lower figure, 31%. They only get to 70% by including corporate taxes, which Krugman mentions, and estate taxes–which he doesn’t mention at all.
But it’s okay. Unlike Krauthammer’s observation I don’t think Krugman is stupid. I think he’s evil.
I’ve started saying the same thing about guns to them, “If you don’t like assault rifles, don’t buy one.” After all the Second Amendment is a right specified on parchment in the Constitution – the “right to abortion” is not, and the more assault rifles around the cheaper they’ll be for me and others like-minded to buy them. Assault rifles. Such a scary term… I own one, an MP15 in .22 caliber that would be quite useful if my house were attacked by an army of squirrels, but against even a lightly armored vehicle or assailant I’d be toast. So of course I have back up, but assault rifle… Sheesh. The only thing these rifles assault is my bank account from the cost of ammo.