The president has been calling for people who "make" over 1 million dollars a year to pay at least 30% of their income in taxes to help pay their fair share. Well it turns out that the majority of people who "have" (not make) over 1 million dollars are currently retired and have the money in retirement accounts that represent a lifetime of savings and therefore don't fall under the income tax rate of 35% for people making over 1 million dollars but under the dividend tax rate of around 15%. According to the last census, there are 3 million people in the U.S. who "have" 1 million or more in savings accounts or stock mutual funds etc. 3 million vs 300 million U.S. population gives us the occupiers "evil 1%". But of those 3 million people only 235,000 actually "make" or earn 1 million or more each year. These people are currently subject to a 35% top tax bracket. So this is already 5% more than Obama's campaign rhetoric. Unless the Bush tax cuts are reinstated for 2013 the top rate will rise from 35% to 40%
But lets say for argument that we take an additional 1 million dollars more per year in taxes from each of these people. That would give us 235 billion a year in new tax revenue assuming that these people would actually sit back and let the government take another million without deciding to move to Costa Rica or to move the money to offshore businesses to avoid those taxes. The current U.S. national debt has been growing an average of 115 billion dollars per month over the last two years. So this new tax would only cover 2 month's of our federal budget shortfall and still leave us with a national annual debt growing at 1.1 trillion dollars a year. But if your goal is to demonize the wealthy and create a red herring issue to motivate the poor to vote for you while ignoring your economic record then it is a great idea. ---- Mike Bair 4/12/12
