Buffet Rule Ridiculousness

It is a sad state of affairs when the media is not even interested in fact-checking anything that comes out of the President's mouth.  OBFUSCATION, OBFUSCATION, OBFUSCATION!  That is all this is... "Let's focus on the 'rich' rather than telling everyone what the real problem is."  SPENDING!

From the Washington Times

The legislation would require people with incomes of more than $1 million to pay at least 30 percent in federal income taxes. It’s named for billionaire investor Warren Buffett, who says it’s not fair for him to pay a lower percentage of taxes than his secretary.

On the face of it, somehow this seems legitimate, especially with the Omaha billionaire tying his name to it.  But, let's look slightly beyond the surface... that is usually all it takes.

So, at 30%, if this legislation was to pass, let us compare the increased tax revenue to the current deficit.  Remember boys and girls, a deficit is the amount that was spent over and above what was generated through tax revenue.  In other words, we (United States) spent more than we made.

Here you can see that lo and behold, at 30% there is very little impact to that killer of economic viability, the deficit.

Let's see what happens if we taxed them (evil millionaires) at 50%.

Huh?  Not much impact at all.  The deficit (over spending) still appears to be greater than 1.2 trillion dollars.

How about at 75%... I know that is ridiculous, who would give 75% of their income to taxes?  Actually, during the Great Depression, the highest tax rates were for people making over $200k - they were taxed at a whopping 94%!!!  Additionally, it wasn't until the late eighties that the tax rate got down into the 30s.  Compare that with the first personal income taxe that was put into place under the Revenue Act of 1861/1862 - 3% for incomes over $600 and 5% for incomes over $10k - these were rescinded just 11 years later. (heavy sigh) Oh, the good old days. 

Now, let's get back to 75% of income.

Holy credit-crunch Batman!  If every person that made over $1 million paid 75% of their income in Federal taxes, we would still have a deficit (over spending) of about $1 trillion.

What about at 100%?  What if we said, "Hey, all you rich and privileged, above average, good looking, jet-setters... we want you to sacrifice this year.  You know that you can live off of savings alone... so, we want you to pay every dollar that you make to the Federal Government."

Jimminy Cricket!  WTH?!!!  This is insane!  The problem isn't millionaires being greedy!  The problem is over spending!  Isn't it obvious?  Never mind the facts - let's get on with creating a common enemy through class warfare!

Thanks to Global Economic Analysis for posting the widget for exploring the "Buffect Effect".