Support the Buffett Rule to Raise Taxes on Millionaires

Target: Senate Minority Leader Mitch McConnell and House Majority Leader John Boehner

Goal: To push Republican leaders in Congress to pass legislation that would set the federal income tax rate on millionaires at a minimum of 30%.

The most financially successful investor in the nation, Warren Buffett, has remarked on multiple occasions that the rich pay too little in taxes. As the law currently stands, many of the wealthiest individuals in the US pay a lower effective tax rate than middle-class workers because there are numerous tax laws that primarily benefit the very wealthy. One such instance is the way income is taxed; income from a job is treated differently than income gained from stock transactions or dividends, known as capital gains. Long-term capital gains are taxed at a maximum rate of 15%, as opposed to the top rate of 35% for standard income. Thus wealthy investors, who make a significant portion of their income from long-term capital gains, end up paying much lower tax rates than middle-class Americans. This is one reason why Mitt Romney was able to pay a federal rate of only 13.9% on an income of $21.7 million in 2010.

The Buffet Rule was proposed by President Obama and would set a minimum tax rate of 30% on individuals making more than one million dollars a year. For one, this is simply a matter of fairness. Wealthy individuals should pay at least the same rate as middle-class individuals. Furthermore, it only makes sense given widening income disparity in our county as the rich continue to earn more while the poor and middle class mostly see their incomes stagnate or decline. Given research on the relationship between income inequality and social ills, it can be seen that the more unequally wealth is distributed in a society, the greater the level of social ills such as poor physical and mental health, greater homicide rates and less trust among citizens. It is also known that these types of ills are more common among people of lower social status. Thus, in a society of great inequality where many people are squeezed out of the middle class, these types of social ills are bound to be more prevalent. These ideas demonstrate that greater equality is in America’s interest, and the Buffett Rule would take a step in that direction.

Not only is it a matter of fairness and interest for the social good, but it would provide the federal government with anywhere between $47 billion and $162 billion in additional revenue over the next decade, depending on whether the Bush tax cuts expire or not. That additional revenue could be used to spur job growth. When an economy goes into deep recession or depression, failing businesses cut jobs, which means many workers lose their source of income, who then fail to buy much. This lowers overall demand in the economy, which only makes the cycle continue. Perhaps the easiest solution is to introduce new demand. The government can do so by spending on programs that benefit the public, such as infrastructure. This spending spurs companies to hire new workers or retain existing ones, who then will spend and create demand, which leads to further hiring. Moody’s Analytics states that for every $1 the federal government spends on infrastructure, the nation’s GDP increases by an average of $1.44. By spending the additional revenue gained from the Buffet Rule on infrastructure, the government would stimulate the economy by somewhere between $67.7 billion and $233.3 billion.

The Democratic Party is very supportive of this measure, but the Republican Party has yet to endorse it. By signing the petition below you will be taking a step to make our society more equal, reduce social ills and potentially stimulate the US economy.

PETITION LETTER:

Dear Senate Minority Leader McConnell and House Majority Leader Boehner,

Many of the wealthiest individuals in this country pay a lower effective tax rate than middle-class individuals. This is due to a number of tax laws which primarily benefit the very wealthy, such as the treatment of capital gains differently than other income. In 2010, Mitt Romney was even able to pay a rate of only 13.9% on an income of $21.7 million.

As a basic matter of fairness we must put an end to such imbalance. The wealthiest Americans should pay at least as much in taxes as middle-class Americans. Furthermore, recent research by Richard Wilkinson and Kate Pickett indicates that a more equal society reduces social ills. To top it off, the additional $47-$162 billion in revenue over the next 10 years could be used to put Americans back to work in a time of high unemployment.

The Buffett Rule would set the federal income tax rate on individuals earning more than one million dollars a year at a minimum of 30%. By supporting it, you can show Americans that you don’t favor the rich over the middle class. You can support a basic measure of fairness, and do good for our country.

I urge you to act in bipartisanship with the Democrats in Congress and support legislation containing the Buffett Rule, such as the Paying a Fair Share Act of 2012.

Sincerely,

[Your Name Here]

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3 Comments

  1. God gives enough wealth and resources to everybody, but He entrusts them to a few who are responsible for sharing so that no one has more than his or her share of the overall struggle.

  2. Adrien Aaron Adrien Aaron says:

    I’m glad to see so many people support this measure! Thanks and keep spreading the word.

  3. Quite frankly, if all these uber-rich folks would pay their taxes to begin with and then have to pay the proportionally correct rate, we’d be in a hellofa lot less financial trouble. While we’re at it, let Congress have to give up all their free perks, subscribe to the same Healthcare plans that the rest of the country does, retire on Social Security (hell even pay SS) we’d really be in better shape to begin with. Why is it none of them have offered to take a pay cut when we end up having to push back the deadline or extend the debt ceiling? Oh no, make the middle class and working poor worry and try to figure out how they will keep a roof over their heads, their kid clothed and fed. . . It isn’t the CEO’s who are the rich in this country – so a our Politicians!

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