Joe Scarborough: Hey, Let’s Raise Capital Gains Taxes On Uber-Rich

While we’re at it, why not take away all the amortization and other breaks companies receive? Let’s nail them with higher taxes, especially companies like Progressive Insurance, General Electric, and Heinz. Take away all the breaks for the sports and entertainment industries

(Politico) The Oracle of Omaha came on the show yesterday and promoted his plan to impose a minimum 30 percent tax on millionaires and billionaires. Warren Buffett said such a tax was necessary because fully a quarter of the 400 richest Americans (who averaged $200 million in income) paid a tax rate of less than 15 percent – and six of those super-rich individuals paid nothing at all.

The reason they pay those percentages is because many don’t actually have much earned income. Some have none. Hence, low tax rates. Plus, they are also able to make massive charitable donations, reducing liability. Anyhow, that’s why so many of those rich liberals advocate to raise their income tax rates. They aren’t worried about it.

FOMJ (Friend-of-Morning-Joe) Steve Rattner has also called for similar increases in tax rates for the ultra-wealthy, with particular emphasis on the capital gains tax and dividends rate. As Steve noted in his New York Times oped, “We need at least $4 trillion of long-term debt reduction, with a substantial portion – on the order of $1.2 trillion — coming from new revenues.”

What we really need is about $16 trillion in debt reduction, and, oh, to pay for the unfunded liabilities, which is somewhere between $75 and $200 trillion dollars.

Mr. Rattner advocates a top capital gains rate of 28 percent.

That’s the rate paid during much of the Clinton years, till it was lowered to 20% in 1997. I say, let’s do it. Let’s put all those rich liberals on the hook. Let’s watch them squeal when they realize that their talking points regarding raising their taxes has come home to roost.

If politicians really want to make millionaires and billionaires pay at a tax rate that most of us endure on April 15th, their moral pangs would be soothed more effectively by following Buffett’s minimum tax plan or focusing on raising the tax rates on capital gains and carried interest. As Mr. Buffett told me yesterday, the richest Americans won’t be affected by the President’s plan to push the top marginal income tax rate back to 39.6 percent. It may be a great punchline on the campaign trail, but hiking the top rate will do little to impact the richest of the rich.

Buffet knows that an income tax increase would mean nothing. Raise his capital gains tax? Big.

Would this mean more revenue into the treasury? Depends on how these “evil rich” people respond. Do they invest more and work their portfolio’s to make up for the lost income? Or do they hold back and shelter it? Not cash in their stock? Move it overseas? Not invest in new businesses?

And the second question is, does anyone believe that the government would do anything other than spend any new revenues instead of using it towards debt and deficit reduction?

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6 Comments

Comment by george talbot
2012-11-29 10:44:50

I’ll go for increased taxes when, and only when, the riches of people like the Kennedys, Kerry and others, are taxed on their wealth. That means no more off shore deposits, death taxes applied to all wealth and unearned (inherited) wealth is taxed like my income is. Oh, and why let the non-taxpayers off the hook. Why can’t they shell out, say 10%, of all their entitlement benefits. I make less than 250K and my tax rate is 21%. Maybe I should quit work and go on the dole.

 
Comment by Gumball_Brains Subscribed to comments via email
2012-11-29 22:59:01

if you did george, you’d probably make more money.
I’m perfectly OK with a wealth tax of 35% on all wealth over $1 million. And, that rate goes up if that income is earned in a smaller percentage of the year compared to an annually earned wealth.

Heard a news report.
The major players in a N. Carolina State Lottery were those households who made less than $20,000 per year. Those households (total income) with income $13,000 or less, paid about 10% of that toward lottery every year.

WHen I was on food stamps, I didn’t have that much disposable income to spend $25 a week on gambling. But then I worked and only received food stamps. I didn’t get all the 20 other welfare programs.

I say we drop the eligibility level to a real poverty level of say… 100% or less. NOT 250%. You can only be eligible for 2 forms of welfare. Take your pick.

 
Comment by Trish Subscribed to comments via email
2012-11-30 13:55:07

 
Comment by Gumball_Brains Subscribed to comments via email
2012-11-30 13:58:42

Poor horse has been getting a pounding lately. From ALL …ALL .. sides.

 
Comment by Trish Subscribed to comments via email
2012-11-30 14:04:13

Yes, poor thing has.
I am so sick of talking about taxing the rich (believe me, it won’t affect my income one tiny bit)especially when I hear nothing, nada, zilch about reducing spending. The f’ers simply want to tax the rich- (I like the over 1 million figure you used GB) and I believe Democrats want to KEEP the loopholes so the Kennedys and Kerry’s and all other rich folks can dodge their taxes still. Otherwise we could have some effective tax reform. But they just want to play class warfare, not fix the problem.

One More Time

 
Comment by Gumball_Brains Subscribed to comments via email
2012-11-30 16:57:23

I don’t know how strong it is inside DC, but I think there is growing murmur about just walking away from this mess. Letting the cliff smack the Obama-voters in the face. Granted, it will hurt alot of good people. But, as you know, people don’t know something is wrong or in trouble until the ship begins to break in half from having tipped up at a 50 degree angle.

Will people wake up in time once they realize that there really is no free lunch any more? that there is such a thing as responsibility?

I say, stop any debt ceiling increase and walk away. let the pain hit that should have been fixed 1-40 years ago.

This whole Super Committee on Balancing the wha wha hawhawahahwblahblah…. was just a punt by the people last year. No one could agree to do anything then nor now. Let them feel the pain.

Especially when we get attacked or invaded, maybe then people will see how useful a well-armed and stocked military is.

 

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