President Obama pushes Buffett rule
Berkshire Hathaway Chairman and CEO Warren Buffett waves at the New York Stock Exchange after ringing the opening bell on September 30, 2011 in New York City. A proposed 30 percent minimum tax on millionaires supported by Buffett and currently being pushed by President Obama has become known as The Buffett Rule.
Kai Ryssdal: Speaking of the general election, President Obama was on the campaign trail in Florida today. Couple of fundraisers and a tax policy speech.
The president's stumping for what's come to be called the Buffett Rule: a minimum tax rate of 30 percent for Americans making more than a million dollars a year. You'll not be surprised to hear Republicans say the proposed rule isn't so much tax policy as tax politics.
Our Washington bureau chief John Dimsdale reports.
John Dimsdale: White House aides say the tax code is rigged in favor of the wealthy. They released a study this morning that finds the highest income households in the country paid an average federal tax of only 18 percent. That’s because most of their earnings are taxed as capital gains.
In Florida today, Obama said that’s not fair.
Barack Obama: The share of our national income going to the top 1 oercent has climbed to levels we haven’t seen since the 1920s. The folks who are benefiting from this are paying taxes at one of the lowest rates in 50 years.
The Buffett Rule’s 30 percent minimum tax on millionaires would bring in an estimated $47 billion in extra government revenue over the next 10 years. Not much compared to the $10 trillion or so in expected red ink over the same time.
James Galbraith: This is, it has to be said, a symbolic gesture. It does not by itself solve any actual economic problem or even make any significant contribution.
Still, University of Texas economist James Galbraith thinks it’s a good idea.
Galbraith: I favor useful symbolic gestures and things that help focus the debate on the problem of inequality, on some of the inequities in the tax code. And it could open the door to a broader progressive reform.
The Buffett Rule is on the Senate agenda next week. Few predict it will pass. But for now, the White House believes it has an argument for fairness on its side.
In Washington, I'm John Dimsdale for Marketplace.