By Louis Avallone
You heard about this, right? In a town hall meeting in Reno, Nevada last month, President Obama said, “I’m rooting for everybody to get rich, but I believe that we can’t ask everybody to sacrifice and then tell the wealthiest among us, well, you can just relax and go count your money, and don’t worry about it. We’re not going to ask anything of you.”
Well, let’s talk about that for a minute, since you brought it up. Who is the “everybody” that is being asked to “sacrifice”, and what exactly are they sacrificing? Or is this merely the trite and tired populist campaign rhetoric talking points, taken from the Democrat operations manual that was written nearly 80 years ago with the ushering in of the New Deal?
You do know, however, that one in every two Americans do not even pay income tax, right? In fact, because of the tax cut extension passed last year, many American families, including those households making between $50,000 and $75,000 annually, will see a reduction of over $2,000 in their federal income taxes, on average. And just in case you didn’t know, the top one percent of American income earners do pay almost 40 percent of all federal income taxes, with the top five percent paying 58 percent, leaving the rest of the taxes due to be split up among the rest of us.
Okay, so if one in every two Americans is not paying any income tax, and are not being asked to “sacrifice” in some other way, then it sounds like the “wealthiest” Americans, according to Obama, need to “pony-up” more or, in the words of Joe Biden, “get some skin in the game,” even though they already have often worked endless hours, for years, with little or no pay, to finance their small business with credit cards, loans from friends and family, and mortgages where the collateral was their own home and good name.
But Obama just doesn’t get it. In one campaign speech after another, he refers to “rich folks” as if they are all lifetime members of a private club, where someone has to die in order for the next person on the waiting list to join or take their seat at the table. And since the conventional wisdom is that these “rich folks” keep getting richer (while the “poor folks” get poorer), it only stands to reason, as he explained in a speech last month, that those “who have benefited most from our way of life can afford to give back a little bit more.”
But, as Abraham Lincoln put it, “You cannot lift the wage earner up by pulling the wage payer down.” The implication from Obama’s comments, instead, is that those who benefit the most in our society have essentially won life’s “lottery” and have a moral debt to repay their community for their good luck. I get that. But Americans already contribute more than $300 billion a year to organized private charities, and volunteer eight billion hours annually to charitable activities, all without government involvement in redistributing anyone’s “wealth.”
Does anyone think that the federal government can do this better than private individuals and organizations? Of course not. Take Warren Buffet, for example. He is one of the richest men in the world and routinely advocates tax increases to fund federal government spending. Yet, ironically, he is leaving most of his estate to private charities, and not the federal government.
Obama says “we’re going to tax people making over $250,000 a year so those millionaires and billionaires will pay their fair share.” Are we listening? All we must hear is the “millionaires and billionaires” part, thinking it doesn’t affect us. But he’s talking about increasing taxes on small businesses, where most of us work, even those that earn $250,000; businesses that are responsible for over 50% of our private sector workforce, 50 % of the gross domestic product (GDP), and 90 % of net new jobs.
These are not all “millionaires and billionaires,” but he must know that. The reason that Obama is coming after the upper-middle class here is because the “millionaires and billionaires” simply don’t have enough money. In fact, he could confiscate all the wealth from the “millionaires and billionaires,” and there still wouldn’t be enough money to cover the costs of his administration’s agenda.
But back to the “rich folks” discussion and Obama’s image of them wearing a banker’s green visor, in a dimly lit backroom, counting their money, all while sipping a lacquer that most folks like me couldn’t pronounce. You see, to vilify the “wealthy” is to accept the flawed reasoning that this is a monolithic group, or that same people are “wealthy” from year to year. For most Americans, wealth is not static, nor a forgone conclusion that they will always be wealthy. Every year, new people will qualify in Obama’s “millionaires and billionaires” club, and every year too, folks will not earn enough to belong and lose their membership.
So when Obama goes after the “club” with higher taxes, he is crippling the galloping American spirit of entrepreneurship, which means fewer jobs created, less ingenuity, and a dampening of the American soul. And that’s the headline here.
Socialism may hope to make sure we all have enough, and guarantee the same outcomes. But even for Obama, it’s hard to ignore: Someone has to first create the wealth, before he can redistribute it.