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Obama Gets the Numbers Wrong In His Tax Plan
Fox News ^ | September 19, 2011 | John R. Lott Jr.

Posted on 09/19/2011 9:55:28 AM PDT by JohnLott

The justification for President Obama's new proposed tax on the wealthy is wrong on the numbers. Despite the president's claims, millionaires don't pay lower tax rates than middle class workers. His proposed surcharge on capital gains and dividend taxes will raise already high tax rates on high income individuals and force even more investment outside the United States. The so-called "Buffett rule" is based on Warren Buffett's claim:

"The 400 of us [here] pay a lower part of our income in taxes than our receptionists do, or our cleaning ladies, for that matter. If you’re in the luckiest 1 per cent of humanity, you owe it to the rest of humanity to think about the other 99 per cent.” . . .

But much more importantly, Buffett's claim ignores why the capital gains and dividend tax rates are set at the level they are: corporate income has already been taxed once when the company earned it. In the United States the combined federal and state corporate tax rate is 40 percent, the highest rate in the world. . . .

(Excerpt) Read more at foxnews.com ...


TOPICS: Business/Economy; Editorial; Government
KEYWORDS: buffett; buffettrule; classwarfare; johnlott; obama; rich; taxes; warrenbuffett

1 posted on 09/19/2011 9:55:28 AM PDT by JohnLott
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To: JohnLott

“If you’re in the luckiest 1 per cent of humanity, you owe it to the rest of humanity to think about the other 99 per cent.” . . .

I agree. That’s why we should encourage the rich to give more to charities instead of the federal government.


2 posted on 09/19/2011 9:57:21 AM PDT by ari-freedom (Thank you, Bob!)
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To: ari-freedom

here here, why do they think giving it to the government is helping the other 99% is beyond me.

The government looses 72% due to administration alone.


3 posted on 09/19/2011 10:00:11 AM PDT by dila813
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To: JohnLott

What American liberalism represents is so odious, so immoral and so manifestly insane that liberals have – in my estimation – essentially forfeited their right to participate in the discussion of public policy


4 posted on 09/19/2011 10:01:27 AM PDT by Ouderkirk (Democrats...the party of Slavery, Segregation, Sodomy, and Sedition)
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To: JohnLott

does the ‘Buffett Rule’ mean we don’t have to pay all of our taxes, fight paying them with the IRS for years, and then complain our taxes are too low? (snark)


5 posted on 09/19/2011 10:01:27 AM PDT by BookmanTheJanitor
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To: JohnLott

Obama has the federal government, the richest organization in the world, demanding more while claiming others have not paid their fair share. What a joke.


6 posted on 09/19/2011 10:03:27 AM PDT by CodeToad (Islam needs to be banned in the US and treated as a criminal enterprise.)
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To: JohnLott

How about introducing a 45% wealth tax on these 1 percenters, tax the pile of cash they already earned. Warren should be all over that one.


7 posted on 09/19/2011 10:03:27 AM PDT by montyspython (This thread needs more cowbell)
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To: BookmanTheJanitor

What is next the no one gets to be a millionaire tax?


8 posted on 09/19/2011 10:04:24 AM PDT by Boardwalk
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To: JohnLott

0bama is mathematically challenged.


9 posted on 09/19/2011 10:08:33 AM PDT by reg45
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To: ari-freedom

And to create more jobs!!!!!!! Give a man a fish....


10 posted on 09/19/2011 10:19:29 AM PDT by tiki
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To: JohnLott

I suspected the bonehead was coming after capital gains and dividends. My stocks are well below basis right now, so I’m not selling anytime soon. Given the new policy, I won’t be buying more either.


11 posted on 09/19/2011 10:20:35 AM PDT by Myrddin
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To: JohnLott

While the author makes some good points he didn’t recognize that Buffett includes the FICA withholding in his calculation. Since the SS portion of income is capped this helps his illustration of why his secretary is “paying more”. Buffett never provided a detailed breakdown so who knows what the actual numbers are.


12 posted on 09/19/2011 10:22:42 AM PDT by SageofRugby
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To: JohnLott

While the author makes some good points he didn’t recognize that Buffett includes the FICA withholding in his calculation. Since the SS portion of income is capped this helps his illustration of why his secretary is “paying more”. Buffett never provided a detailed breakdown so who knows what the actual numbers are.


13 posted on 09/19/2011 10:23:14 AM PDT by SageofRugby
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To: JohnLott

Progressives are Mathematically challenged


14 posted on 09/19/2011 10:30:37 AM PDT by 4Speed
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To: JohnLott

5% annual wealth tax, excluding residences up to $1m, tax-protected IRA-type accounts up to $5m, and other personal assets up to $1m.

Maybe a better rate if they’re holding treasury notes.

Just until we extinguish the national debt.

I’m sure Warren and his pals would love that.


15 posted on 09/19/2011 10:30:42 AM PDT by Atlas Sneezed (Are you better off now than you were four trillion dollars ago?)
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To: JohnLott
The rich didn't create this problem, the government did.

This is not a plan, it's an insult. They want to raise taxes immediately and will "start" to bring the deficit down starting in 2017?

I say we start immediately to replace politicians to who plan in periods that exceed their current term.

16 posted on 09/19/2011 10:34:22 AM PDT by oldbrowser (Obama is a one trick phony (wealth distribution).)
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To: Beelzebubba

I think they intend to include residences because the Kennedys are turning the main house at the Compound into a “library”.


17 posted on 09/19/2011 10:41:14 AM PDT by massgopguy (I owe everything to George Bailey)
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To: JohnLott

“But much more importantly, Buffett’s claim ignores why the capital gains and dividend tax rates are set at the level they are”

Right, so if Buffett owns Berkshire Hathaway and they pay
corporate income taxes, then the income tax is already paid, and dividend taxation is double taxation.

But here is the funny thing - Buffett the hypocrite is going around saying he should pay more, and yet the company he owns is fightng the IRS over taxes!!!


http://netrightdaily.com/2011/08/warren-buffett’s-taxing-hypocrisy/

[Warren Buffett] wrote of the so-called “super-rich,” which he apparently defines as households earning $1 million or more a year: “Most wouldn’t mind being told to pay more in taxes as well, particularly when so many of their fellow citizens are truly suffering.” Isn’t that nice of Mr. Buffett?

But if he were truly sincere, perhaps he might simply try paying the taxes the IRS says his company owes? According to Berkshire Hathaway’s own annual report — see Note 15 on pp. 54-56 — the company has been in a years-long dispute over its federal tax bills.

According to the report, “We anticipate that we will resolve all adjustments proposed by the IRS for the 2002 through 2004 tax years at the IRS Appeals Division within the next 12 months. The IRS has completed its examination of our consolidated U.S. federal income tax returns for the 2005 and 2006 tax years and the proposed adjustments are currently being reviewed by the IRS Appeals Division process. The IRS is currently auditing our consolidated U.S. federal income tax returns for the 2007 through 2009 tax years.”


Buffett needs to PAY UP.


18 posted on 09/19/2011 10:50:28 AM PDT by WOSG
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To: reg45
He did say he had a numeracy problem.
Right after the 10,000 killed by a tornado and the 57 state remark.
19 posted on 09/19/2011 10:55:48 AM PDT by cruise_missile
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To: JohnLott

Obama gets a lot wrong:

“I will close GITMO within 1 year.”
“I will end the wars and bring the troops home.”
“Healthcare debates will be openly broadcast on C-SPAN.”
“As long as we pass the stimulus bill, unemployment will not go above 8%.”
“We will be held accountable for how every penny of this stimulus money is spent.”
“All these shovel-ready jobs are waiting the passing of the stimulus bill.”
“Obamacare will lower healthcare costs and create 400,000 jobs immediately.”
“I will not renew the Patriot Act.”
“There will be no lobbyists working in the White House.”
“PAYGO.”
“I will repeal the Bush Tax Cuts.”
“I’ll be focusing like a laser on job creation” (pick any of the thousand times he’s said that).
“There will be comprehensive immigration reform in the first year of my presidency.”
“I will cut the deficit in half by the end of my second year.”
“Sunshine before Signing - All bills will be posted on line for 5 days before I sign them.”
“I will go through every budget, line by line, and eliminate unnecessary spending.”
“I will make government functional again.”

“If I can’t turn this economy around by the end of my 3rd year, I’ll be a 1-term president.”
-— Barack Obama


20 posted on 09/19/2011 11:12:24 AM PDT by WOSG
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To: JohnLott
Obama Gets the Numbers Wrong In His Tax Plan

This is not really 'news' as I understand the definition of 'news'.

Now, if Obama got the numbers right in his tax plan? That would be news...

21 posted on 09/19/2011 11:38:59 AM PDT by WayneS (Don't Blame Me, I voted for Kodos!)
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To: JohnLott


"Math was muh best subject, heeyurk!!"

22 posted on 09/19/2011 12:01:22 PM PDT by cake_crumb (Obama: the Unholy Won.)
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To: WOSG
"If I can’t turn this economy around by the end of my 3rd year, I’ll be a 1-term president."

Hopefully he got THAT one RIGHT.

23 posted on 09/19/2011 12:06:17 PM PDT by cake_crumb (Obama: the Unholy Won.)
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To: reg45
0bama is mathematically challenged.
24 posted on 09/19/2011 12:26:23 PM PDT by svcw ( http://www.internetlastpage.com)
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To: JohnLott
I fear Obama just doodled higher than a kite in math.

Teacher: Barack would you please show the class how to graph this quadratic equation. Here's the chalk kid.

Barackodoodler:'None plus me equals Hopey Changy! Walk like a buterfly and sting like a flea I'm so happy I'm me, now about meth, umm yeah I took it to get high, wasn't that the point? Check my grades in school, oh wait I made certain no one knows I had troubles since that madrassa...I AM THEE ONE. Take a looky me now!'

Teacher:*Head pound x5*

25 posted on 09/19/2011 1:26:43 PM PDT by Karliner ("If we were real domestic terrorists, shoot, Obama would want to pal around with us, wouldn't he?")
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To: JohnLott
Qui bono?

The banks benefit here. Taxing dividends that individuals get means they are fully taxed twice, which just increases the advantage the banks get.

Where I work, it was explained that the interest rate we need to use in figuring payback for a project, is 8% for a loan or bond, and 12% for dividends. Doubling the tax on dividends puts the tradeoff at 8% vs 16%. This new tax will just mean more business for the banks, and a shafting for the stockholder as the price of the stock collapses.

If the Republicans were going to take a risk, I suggest the offer to accept this tax, but only if dividends are deductible at the corporate end, thus taxed only once.

That would shake things up a lot. Equity and debt would be on a more even playing field. Shareholders are more patient than banks, you can cut a dividend without bankruptcy, but you can't not pay the banks the interest they demand. If a dividend isn't paid, the managers might get thrown out. If interest isn't paid, the company might get foreclosed on. This just might reduce some of the short term thinking of American managers (or not, as much is driven by bonus payouts).

But, since it's an idea that can't be fully expressed in a 3 word sound bite, I expect it will never be considered.

The bankers seem to be the only folks neither party is willing to offend.

26 posted on 09/19/2011 1:59:44 PM PDT by slowhandluke (It's hard to be cynical enough in this age.)
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To: All; JohnLott
As someone who knows a little about math, Herman Cain had a response to Obama today:

Today, the Obama Administration's assault on the private sector continued. In yet another speech, he called for America's job creators to shoulder an even heavier burden than they must already. President Obama promised that his efforts were not "class warfare," but instead "math."

Perhaps he could learn a lesson or two on math from me. I have a degree in mathematics and spent the earlier days of my career as a supervisory mathematician for the Department of the Navy. Then, I worked for 40 years as an executive in the private sector where I balanced budgets, saved failing companies and created jobs. Both obviously demanded a command of advanced mathematics.

Here's what I can tell him about math: raising taxes on anyone, no matter their income level, will do nothing to stimulate our economy, create jobs or balance our federal budget. Increasing taxes on the private sector will destroy jobs, further damaging our economy and sending even less revenue to the federal government.

His eagerness to punish the private sector indicates he doesn't understand the most important truth of basic economics: the private sector creates jobs. These are the jobs that pay for the food for our families, the roofs over our heads, the heat for our homes, the clothes on our backs, the schools for our kids and the plans for our retirement.

Perhaps his ignorance of basic economics is due to the fact that both he and more than 90 percent of his Administration have no private sector experience at all. Thus, they are all too willing to continually punish America's job creators, all in the name of "fairness."

President Obama's once said, "You can put lipstick on a pig, but it's still a pig." I agree. It doesn't matter that he calls it "paying your fair share." It's still class warfare.


27 posted on 09/19/2011 3:52:52 PM PDT by newzjunkey (Will racist demagogue Andre Carson be censured by the House?)
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Thanks JohnLott. Here's the Occupy Wall Street battle cry, how's this one taste, Buffett?
"If you're in the luckiest 1 per cent of humanity, you owe it to the rest of humanity to think about the other 99 per cent."

28 posted on 10/15/2011 9:45:00 AM PDT by SunkenCiv (It's never a bad time to FReep this link -- https://secure.freerepublic.com/donate/)
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