Taxing the rich
Is 'Buffett Rule' politics over policy?
- Duration 7:10
- Date Apr 14, 2012
Is 'Buffett Rule' politics over policy?
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What Romer was calling for that is the same thing there were calling for now.
-- basic fairness and responsibility.
Everybody doing their part.
Welcome to The Journal Editorial Report I'm stood bombing in this week the polls you go well you just -- -- President Obama.
Invoking Ronald Reagan and claiming that his latest plan to tax the rich is all about -- The president officially endorse the so called Buffett rule in the swing state of Florida Tuesday.
Calling for a minimum 30% tax on those making more than a million dollars in via.
His campaign clearly thinks it is a political winner but is it good policy.
Let's fast Wall Street Journal columnist and deputy editor Dan -- got columnist Mary Anastasia O'Grady.
Assistant editorial page editor James Freeman and Washington columnist constructs.
Down to you folks might call this class warfare.
I know something about that it is this a winning political strategy.
At this -- Stuart invoking Ronald Reagan in this context really takes the cake we'll get to that later but.
Bear in mind that the first time around with the Obama rule it wasn't about basic fairness it was about reducing the deficit as the president said it's simple map both somebody did the arithmetic and it turns out it adds up to about five billion dollars a year.
A tear drop in denting that deficit so that we shifted to basic fairness.
And I think the problem with that is.
He is running in a way that it -- resentment on the part of some voters and I don't think most people carry resentment.
And the idea -- around in the front of their heads all the -- line.
But he's going to have to sustain -- -- -- giving these class workers speeches and while it may work I don't think it's a winning strategy I don't think he can.
Build a majority on that basis some people will respond but I don't think an off.
At camp I wanna stay with a political angle for a second in America does class war fan win.
A look at the president's doing this for two reasons or one is because he just doesn't have anything else -- to run on the economy's not great his record is not strong.
He's also doing it because he views this as a weak spot for Mitt Romney who is -- -- sensitive about his own wealth.
The premise if you ask Americans.
In the abstract -- they think the millionaires and billionaires should pay more they say yes.
More interest -- now are the polls that say what do you think -- the most important issue.
They do not believe this is the most important issue they want a president who's going to tell them how he's going to fix the economy.
What he's gonna do to fix the deficit so the question is do you motivate people to go to the polls on this issue.
Can he win as a president running on higher taxes that's a bigger gamble.
Which brings us to the question of whether run -- this is good economic policy.
But look the premise of the president's position is that this is -- this is -- Is it.
-- well -- the question is.
Paying your fair share.
It certainly is not mean the top 1%.
Of earners in this country already pay about 40% of the taxes the top 5%.
Pay almost 60% of the taxes and the bottom 50%.
Pay less than 3% of the taxes so -- about paying your fair share that's thirty happening.
What the president is doing here is getting at something outs which is very common in Latin America.
He wants everybody to be equal and he thinks that that's a resounding.
-- message to the American voter I don't think artists James well.
Ben just to clarify this is not what Ronald Reagan was calling for -- -- -- amazing this week the White House using the 1986 tax reform.
Good connection and connecting it to the buffet rule the 86 tax reform under Reagan was lowering rates cutting deductions simplifying taxes and what Obama and President Obama is proposing air no elimination of deductions no simplification.
No rate cuts.
Increasing taxes on capital gains so it's it's really the exact opposite I think you have to wonder.
Is any growth strategy to say we're gonna tax.
Equity investment more in -- judgment is it good economic -- -- to -- -- really was -- here with all of these nervous investors are scared companies individuals sitting on cash.
Investing in long term treasury bonds instead of taking risks.
And this is a this is an -- right at that -- -- to say we're gonna make it more expensive to invest in equities.
And to james' point what what is so fascinating about the president's presentation especially invoking Reagan is.
He himself does not even talk about the growth aspects of this tax policy did anyone hear him talking about how his tax policy was going to.
Foment economic growth Reagan did it all the time.
Barack Obama isn't even talking about that which is obviously the primary issue in the center of the campaign it's really kind of amazing that he doesn't somehow try to make a case for how this is going to improve the economy -- I think it's going to be voted on next week in the -- How much Democrats support will it.
Guess -- they have brought this issue up several times in the senate before it has never actually passed.
Any you touched on an another -- for Democrat says.
Senate majority leader Harry Reid is starting to get a real reputation and -- overseeing a graveyard America.
Growing complaints and that says the house Republicans and passed dozens of pieces of legislation there are I even bills.
The president Barack Obama says he support the senate Democrats support.
Then but Harry Reid said no time tended to be any of those and bring them to the floor because they're holding show votes -- this.
Legislation that's not gonna pass but -- all design for the political campaign this fall.
All designed for the political campaign this fall I have to keep going back to that question does class war fat win that.
Politically in America I understand that in the past it has not.
This year -- you think it's a winning issue politically.
I don't they're going to try again because he don't have much else now the only way that they might win this is if Mitt Romney does not actually respond -- this is the president drawing a line in the sand saying this is what we are going to fight over.
If Mitt Romney decides to agree with him and continue saying things like while the rich can take care of himself.
-- -- that issue he's got to go out and make the argument that lower tax rates for all are what create jobs and economic growth he can't do that.
Then that the Republicans have a problem I think Kim is absolutely right on that this is an opportunity for Romney I mean here is the president is going after.
The single most important group of people who can create jobs who can give us capital formation.
Who can give us growth and Romney has to make that very clear because if -- the president just.
Sales through on this resentment issue I think it's going to be very tough.
Last but you can hit the buffet rule it's it's a political Shanley doesn't raise money and Warren Buffett is really back and be affected by it because he is bragged about shielding his wealth from capital gains taxes so it's not even get -- -- -- at -- I want the last -- in class war but it does not look in America.