The Buffett Rule, Mitt Romney, and Fairness
by Josh Hedtke | UCLA
I want to wish Mr. Buffett a speedy recovery and a swift end to his recently disclosed bout with prostate cancer. That said, I’d like to say a few negative things about his namesake rule, discuss fairness, and convey some thoughts on Mitt Romney.
The so-called “Buffett Rule” came before the Senate yesterday for a cloture vote and was denied 51-45 (nine votes fewer than necessary to proceed with debate). President Obama endorsed the “rule,” which is really a principle that holds that people who earn less should not pay higher rates than those that earn more. It was likely quite a shock to the President’s plans for deficit reduction; after all, he himself said: “It will help us close our deficit.”
He’s right, the Buffett Rule would help us close the deficit. By about $5 billion a year. That’s approximately .38% of the projected federal deficit for fiscal year 2012 and .032% of the total national debt. Since the numbers don’t quite add up, all the hoopla surrounding the Buffett Rule must be about something else.
And it is. It’s all about fairness. There’s no way in hell Warren Buffet should pay a lower nominal tax rate (on capital-gains, that is) than his secretary does (on income). Buffett, recipient of the Medal of Freedom, likes to say that his kind – billionaires and millionaires – have been “coddled” for too long. President Obama consistently uses the Buffett-endorsed rhetoric by saying that everyone needs to pay their fair share. The left has indeed buffeted the nation with the fairness rhetoric for quite some time now.
The left, and anyone else who desires a higher tax not based on certain types of income but rather on the sheer amount of income one earns, has a skewed understanding of the word “fair.” By advocating for a tax based solely on the amount of money a person has made by various means rather than on the means themselves, one is arguing for fairness of results rather than fairness of process. Such a tax is alarmingly arbitrary and rather unfair. Sure, right now it’s a tax on millionaires, but in the future it could just as easily be a tax on twohundredfiftythousand-aires.
Fair to me means uniform standards for everybody, at least in the context of governing a polity. If it is unfair that millionaires pay a lower rate than their secretaries, isn’t it equally, if not more unfair, that 50% of the nation pays no income taxes at all? Ah, but a politician making this point would then be wading into the forbidden waters of poor-people-hating and enormously-sized-voter-base-alienating.
Indeed, there is nothing truly unfair about a millionaire paying a lower tax rate on part of his income than his or her secretary. The low capital-gains tax rate has historically been regarded as a success in encouraging economic investment and growth, and so we abide by it.
But millionaires suck, anyway. Mitt Romney’s a millionaire. Does Mitt Romney suck, then? Perhaps, but not because he’s a millionaire.
Multitudes of pundits, particularly on the left, claim that Mitt Romney cannot relate to the common American person, because he’s just too rich. I mean, come on, the man had plans to construct a car elevator. Hilary Rosen had some things to say about Ann Romney’s “never working a day in her life” because the Romney family is so stinkin’ rich (despite the fact that Ann successfully raised five children and battled multiple sclerosis and breast cancer).
On the contrary, I believe Mitt Romney relates relatively well to the average American. Mitt has spent the majority of his career in the private sector, competing and creating. Mitt Romney has indeed made a very comfortable life for himself. He ascended the corporate ladder at Bain & Company and has since enjoyed the fruits of his labor, eventually finding his way into politics.
What’s so bad about this? I envy Mitt Romney and I strive to be as successful as him in the future. But the national dialogue and sentiment seem to suggest that Romney’s success is all some stroke of luck facilitated by his fortunate upbringing. It isn’t; he undoubtedly had to work hard to achieve such success, and he did. Good for him.
Sure, Romney’s been more successful than the large majority of Americans, but he still relates better to us than Barack Obama. President Obama spent two years of his entire life in the private sector and the rest either holding public office, campaigning for office, or rearranging chairs in a town hall on the South side of Chicago. How many average Americans can say their experiences have been generally similar to Mr. Obama’s?
The feeling in America these days is such that people like Romney should be down here in the lower income brackets with us rather than us be in the upper income brackets with him. Such is the underlying inspiration for a tax like the Buffet Rule. We’re currently running a race to the center rather than a race to the top. The race may be “fair,” but it’s not very rewarding.
If I were Mitt Romney, I’d brag like hell about my success and say, “Don’t you want to have as much money as me?” If Americans’ answer is yes, then they should scrap silly ideas like the “Buffett Rule” and vote our fair, incumbent president out of office in November.Josh is from San Diego