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September 19, 2011 8:00 AM The ‘Buffett Rule’ vs. ‘Class Warfare’

By Steve Benen

Over the weekend, the White House leaked word that President Obama will push a new debt-reduction idea: the “Buffett Rule.” Named after Warren Buffett, the chairman and chief executive of Berkshire Hathaway, who’s been urging policymakers to raise taxes on the very wealthy. As Buffett recently explained, millionaires and billionaires “have been coddled long enough.”

We don’t yet know the details of the proposal — most notably, what the new millionaires’ minimum tax rate would be — but Republicans are already responding with predictable disgust.

Here, for example, was House Budget Committee Chairman Paul Ryan (R-Wis.) yesterday on Fox News, making the case for coddling millionaires and billionaires for a while longer. See if you can pick up on the subtlety of his talking points.

Class warfare, Chris, may make for really good politics but it makes a rotten economics. We don’t need a system that seeks to divide people. […]

“[I]t looks like the president wants to move down the class warfare path. Class warfare will simply divide this country more. It will attack job creators, divide people and it doesn’t grow the economy. […]

“[I]f we are just going to do class warfare and trying to get tax increases out of this, and I don’t think much will come of it…. He’s in a political class warfare mode and campaign mode.”

So, I guess I’ll put him down as a “maybe” on the Buffett Rule?

By any reasonable measure, Ryan’s arguments aren’t just wrong, they’re borderline offensive.

For a generation, Republican policymakers have rigged national tax policy to reward the wealthy, and then reward them some more. We’ve seen the class gap reach Gilded Era levels, only to hear GOP officials again demand that working families “sacrifice” while lavishing more breaks on the very wealthy.

Remind me, who’s engaged in “class warfare” and “dividing people”?

Also note the larger policy context here. President Obama wants the richest of the rich to pay a little more, but keep tax breaks in place for the middle class. Paul Ryan and his cohorts want the polar opposite — more breaks for the very wealthy and higher taxes for the middle class.

Let’s also not forget that one of the GOP’s more common tax-policy arguments is that nearly half the country doesn’t have any federal income tax burden — and they see that as a problem that needs fixing. As a practical matter, the Republican argument on this is practically the definition of “class warfare.”

I realize much of the political establishment has come to look at Paul Ryan as a wise wonk who deserves to be taken seriously, but it really doesn’t take much to realize how spectacularly wrong the far-right Wisconsinite really is.

Steve Benen is a contributing writer to the Washington Monthly, joining the publication in August, 2008 as chief blogger for the Washington Monthly blog, Political Animal.

Comments

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  • Mac on September 19, 2011 8:04 AM:

    Republicans *do* love their wars.

  • c u n d gulag on September 19, 2011 8:10 AM:

    Paul Ryan is a well paid, well taken care of, blue-eyed sociopath.

    The Republicans have been waging class warfare for almost 30 years.

    I suggest we rename how hostages feel from "The Stockholm Syndrome" to 'The Reagan Syndrome."

    Oh, and we need to get a really good Democratic candidate up in Ryan's district so that we can make him a casualty of class warfare.

  • Steve Paradis on September 19, 2011 8:12 AM:

    And please, could we have a little less of the "working class hero" airs of Paul Ryan? The family construction firm was his safety net when his father died; he said himself his mother got him into a job on the local congressman's staff when he talked about becoming a ski bum.

  • FRP on September 19, 2011 8:13 AM:

    That Americans are engaged in more wars all over the place , including the infantile ones on adjectives . So yes Republicans love them some war , but so do the ordinary stripe of narrative slurping American wanna be hero . All it takes to lose that appetite is another one . An appetite fed by thirty years of class warfare being waged against the "Middle Class" by the allied forces of plutocrat John Bircher and Corporation persons making 14 billion and having no taxable responsibility . The fine fettle of right wing class warfare has left just such an appetite . Or should I say appetites ? In the end there can be only one , yup , hunger .
    The American hero is now bravely looking for booschievilles to park their middle class carcass . In these estimable quarters they can dine on fine Jungle Stews from their pick of first class seconds .

  • Grumpy on September 19, 2011 8:23 AM:

    Given that a higher tax rate on millionaires would affect Obama himself, it's more like class insurgency, am I right?

  • ElegantFowl on September 19, 2011 8:28 AM:

    The rich are net Job Destroyers. That applies not only to the executives doing finance-industry bidding to outsource jobs, undermine unions, and use increased productivity to increase profits instead of investing in growth. It applies to garden-variety millionaires who take home 10X median salary for ordinary performance at ordinary white-collar marketing-sales-whatever jobs. Their outlandish compensation drains resources that could be used to hire and pay people who actually make and do stuff.

    Don't even use the republican words and join debate. They're Job Destroyers.

  • Bartender on September 19, 2011 8:30 AM:

    Ok, Republicians, so you don't like Obama's plan. Tell me, when in the last 50 years have your proposals for sustained economic growth hasn't included raising taxes and higher tax rates for the wealthy - especially during war time. Even Reagan had to backtrack and raise taxes when he cut too much. So show me the data. SHOW ME THE DATA!

  • Steve Stein on September 19, 2011 8:31 AM:

    They only call it "class warfare" when we start fighting back.

    Ryan reminds me of the kid who cried "Mommy, he hit me back first!"

  • lou on September 19, 2011 8:31 AM:

    shorter Ryan: How uppity of the darkie to point out how the wealthy have made out like bandits in a shitty economy.

  • POed Lib on September 19, 2011 8:31 AM:

    There is already a candidate in Ryan's district WI-1. I am not a resident, so cannot say if the candidate is credible or not. He is on the ground, and already using the "catfood offense" against Ryan. He is a county supervisor, and so has a modest name. However, Ryan will be very difficult to beat. He routinely gets 65%, and the redistrict made his district safer. I'm not holding my breath, myself.

  • ElegantFowl on September 19, 2011 8:33 AM:

    And Mitt Romney's tenure in private equity at Bain earns him Job Destroyer #1.

  • Brenna on September 19, 2011 8:33 AM:

    I think Paul Ryan is evil incarnate. He also said yesterday he liked the idea of the unemployed working for free. "Work Shall Set You Free." Anyone remember that slogan?

    I'm glad to see Obama in fighting form. I think a lot of people will support him on this. Good policy, good politics.

  • blondie on September 19, 2011 8:36 AM:

    Excuse me, I realize that rational thinking and common sense have no place in the Republican worldview, but ... don't we already have different tax brackets? How is this, in the end, any different?

    Oh, that's right, it's not.

  • FRP on September 19, 2011 8:38 AM:

    FDR was an insurgent , Obama is new money so he is more of an ordinary rebel . His grandchildren of the Manor born should fit the FDR insurgent role .
    After Alexander defeated the Persians there was an emptying of the royal treasuries . The following was a predictable sustained economic boom lasting until the next ancient war against the yeoman , merchant class could be won .
    The reason the rich grow richer is that they are led by bullies who take candy from babies .

  • flyonthewall on September 19, 2011 8:44 AM:

    Everyone who consumes is a job creator. The class Ryan refers to is a minority. Since when have repubs been for minorities?

  • SadOldVet on September 19, 2011 8:54 AM:

    Yes, but Ryan does support using the Georgia model of having unemployed work for privately/corporately owned businesses for free.

    Naturally, that is definitely not class warfare!

  • SW on September 19, 2011 8:55 AM:

    He's not just wrong, he's a whore. My apologies to legitimate sex workers everywhere.

  • Fever on September 19, 2011 9:10 AM:

    Folks its progressive tax system which means the more you make the higher your tax rate. That statement has been true under both Republican and Democratic leadership and it’s true today. Ryan supports a progressive tax system as well as every other mainstream Republican. However, as a percentage of tax revenue collected, the “rich” pay more than ever before. Us Republicans think that is the root cause of both out of control spending and the current economic malaise. And when the tax code targets one group of people that happen to be rich, while sparing all others, I see no other way to describe it than “class warfare”.

  • Dave Munger on September 19, 2011 9:17 AM:

    All Obama is asking is that millionaires pay the SAME RATE as middle-income taxpayers. How is this class warfare? This is the opposite of class warfare. Class warfare is when upper-income taxpayers pay LESS than everyone else, i.e., the situation we have right now. Obama is proposing to end class warfare.

  • mellowjohn on September 19, 2011 9:22 AM:

    class warfare as defined in one of my favorite movies:

    "Red Will" Danaher: So the I.R.A. is in this too, is it?

    Hugh Forbes: If it were, Red Will Danaher, not a scorched stone of your fine house would still be standing.

    Michaleen Flynn: A beautiful sentiment!

  • T2 on September 19, 2011 9:40 AM:

    remember, whatever a Republican says, reality is the opposite. When Ryan complains about "class warfare" being waged by Obama, what Ryan really means is he wants class warfare so the Rich Class can get wealthier at the expense of the mid/low.

  • Lance on September 19, 2011 9:43 AM:

    It's 'Class Warfare' when we fight back.

    It's 'Class Opression' when we don't.

    The bullies are whining to the principal when we punch back.

    It's more than time for us to stand up for ourselves.

  • Kathryn on September 19, 2011 9:51 AM:

    I wonder if there is any data on the percentage of millionaires who are self made, as opposed to millionaires who inherited either substantial money or businesses. Betting the vast majority fall into the latter categories.

    Part of the American dream/fantasy is if you work hard enough, you too can become rich and successful. It would be interesting to know the percentage of self made millionaires. Not to denigrate working hard, but the vast majority of Americans are not going to climb up the wage ladder no matter how hard they work especially in this environment given how many folks are looking for work. How many Americans born into poverty and often dysfunction become rich? It's a much slower assent from poverty to some slight increase in quality of life. Taxing the poor more is kicking them to the curb. If the voters turn this country over to the Republicans, we will see people dying in the streets or backstreets. Already American are dying from lack of money to get antibiotics and other medical care.

  • sparrow on September 19, 2011 10:02 AM:

    That Ryan has his staff read Ayn Rand pretty much tells you where his head is at with his juvenile adherence to a world view that there are basically really only two classes in America: a few John Galts living at the top of the food chain and the rest a bunch of parasitic leeches whose lives depend on the John Galts for their survival. Sadly, that so many have bought into this flim flam pitch is an indication of just how well the Republicans have marketed the notion to the rubes.

  • jcricket on September 19, 2011 10:13 AM:

    Poor Fever @9:10.

    Doesn't know that tax law distinguishes between earned income and capital gains. The rich DO have lower tax rates because they disproportionately garner income from investments.

    That's the beauty of being rich, you have so much left over from normal living that you can invest. The little people who need their paychecks to pay bills really don't have that luxury and pay a higher tax rate on their income.

    The rich get further tax breaks because there are tax loopholes and credits (often related to specific investments or even industries) that have been set up in the tax code specifically as favors from congressional 'gratitude' for political support.

    This is the real class warfare going on. Crony capitalism in the tax code in the form of a lower capital gains tax rate, loopholes, and credits for those who can pay to play. The rest of us have to pay full price.

    Fever, you might think that the root cause of the bad economy is out of control spending, but you are ten years too late. Where were you and your R buddies when Bush was emptying the surplus in the Treasury and borrowing to pay for two wars and give billions to the pharma industry in the form of Medicare D? Oh, that's right. You were patriotic and waved the flag without saying a thing.

    And as for 'malaise' (nice Carter reference, by the way, Dog Whistle much?), why don't you aim that little arrow at Wall Street where banks are sitting on cash but refuse to lend to small businesses, or at the multinational companies (oil companies) who make money here, but siphon the cash to their overseas havens?

    You Republicans who copy and paste the conservative meme don't seem to understand that the public at large simply doesn't believe that the rich are paying their fair share. And the reason for this is simple. They're not.

  • Peter C on September 19, 2011 10:26 AM:

    Divide the country EVEN MORE?????

    The Republicans have been in open revolt since Obama took office. There is no common ground to walk away from anymore.

  • zandru on September 19, 2011 10:48 AM:

    Thank you, jcricket. That was excellent - well stated and accurate.

    The public doesn't know a d*** thing about taxes. Makes you wonder who does their 1040s every year. As I've said before, you can learn a lot simply by reading the instructions for the 1040 long form. Get your "PhD" (in relative terms) by checking into the 1120 for corporations.

    When you KNOW, you can speak authoritatively, and even if people think of you as a "librul", they are more likely to accept that your facts are right.

  • Texas Aggie on September 19, 2011 11:09 AM:

    "nearly half the country doesn’t have any federal income tax burden —"

    It isn't almost half the country. It's ALL the country doesn't pay any federal income tax on the first $26,000 for a family of four just taking the standard deduction.

    And, Zandru, when you say the public doesn't know jack about taxes, you couldn't be more right. Not too long ago Steve was discussing what a marginal tax rate was and how people just didn't get it. This discussion about not paying taxes is just an extension of that same problem.

  • Fever on September 19, 2011 12:13 PM:

    Jcricket:

    It is true; the tax code does not tax capital gains at the same rate as earned income. In addition the tax code is filled with loopholes and evidence of crony capitalism. Having said these truths, imposing higher tax rates on earned income doesn’t do anything about capital gains, loopholes or crony capitalism. And as usual, when backed into a corner, you Democrats love to throw the kitchen sink at the issue: Banks (borrower fraud), Bush (an oldie but goodie), big pharma (is there a small pharma), Iraq (didn’t your team vote to fight), Wall Street (the ones that gave money to the poor to buy houses), deficit spending (scary isn’t it), multi-national companies (who employ people), etc. I think we should stay on issue.

  • Roger Ailes on September 19, 2011 12:16 PM:

    I'm all for class warfare, but I'm doubtful Obama will let us win.

  • Old Uncle Dave on September 19, 2011 12:44 PM:

    Ryan and his ilk won't realize the error of their ways until angry mobs start torching the gated communities of the rich.

  • Josef K on September 19, 2011 12:54 PM:

    The lack of self-awareness of the Republican caucus never ceases to amaze and depress me. But then it does seem a bit of a pattern in western society that a major power goes through some self-inflicted massive bloodletting on or near the turn of ever century.

    Great Britain spent most of the 1600s in upheaval. France was chaos incarnate between 1789 and 1800. Russia slowly (then violently) blew up between 1905 and 1922.

    Guess its our turn now, all thanks to the increasingly-ironically named Republicans.

  • Rob on September 19, 2011 1:24 PM:

    As an outsider I can see one thing clearly...your country is doomed. The Republicans (more like republican'ts for how much they love to gum up your country's works) are squarely in the employ of the untra rich and the corperations. They have convinced the hillbillys in the south and the farmers in the mid-west that anything that disturbs their rich masters plans is unamerican and the yokels believe it. It's not about proof it's about who shouts the loudest and praises the non-existent super being the most who is believed. Apparently their definition of freedom is really freedom to be enslaved by the wealthy and the corperations. As a result your sons and daughters go off to fight wars not to liberate people or to fight terrorism, but to liberate people from their natural resources and fight the terror of the rich not becoming even more so.
    So now that your president just asks the vultures who prey upon you to contribute their fair share (after all they have feasted and grown fat) these republicants call it class warfare.
    It seems more like a case of class self defense after all the rich declared war ont eh rest of you long ago

  • Texas Aggie on September 19, 2011 1:25 PM:

    imposing higher tax rates on earned income doesn’t do anything about capital gains, loopholes or crony capitalism. - Fever

    Fever, as per usual for the right wing, is indulging in distraction from the issue at hand. He puts out a false statement as the basis for his argument (no where is there any indication that the higher tax rates being asked for are only on earned income) and then distorts the subject. If s/he were being honest about it, then imposing higher tax rates on all income, as is being proposed by Warren Buffett, would cover the pseudoproblems that Fever imagines.

    Then there are the silly snide remarks s/he makes about the basis for our problems such as Bush getting us into two unpaid for wars that are now being paid for on the books, the banks that are continuing to defraud borrowers with fake robosignatures claiming to own a mortgage that they have no idea who owns, big pharma that is using its muscle to prevent small pharma from producing generic drugs that would reduce the costs of medical care and that is using PR and its corps of paid for doctors to get people to take drugs for conditions that don't exist, Iraq that was opposed only by Democrats (check the votes), Wall St. that did and continues to sell trash as gold and that never gave money to anyone, and multinational companies that off shore jobs and profits so that they don't pay taxes on them. As for the "scary deficit," only the republicans are scared by it. Knowledgeable people including the vast majority of economists and business owners want MORE deficit spending at the moment to allow people to buy things thus stimulating demand and job creation.

  • Fever on September 19, 2011 4:53 PM:

    If you eliminate deductions/loopholes for the rich and allow them for the poor, you effectively increase the percent the rich pay in taxes. Same result for capital gains taxes. Look, its clear Obama wants to tax the rich despite the fact the rich pay a higher percent of the total tax proceeds than ever before. I was simply pointing out the untruths with the Jcricket’s notion that the rich don’t pay their fair share. BTW, are those the same “knowledgeable people” that think by increasing unemployment benefits you increase employment.

  • Chuck on September 19, 2011 5:43 PM:

    What Fever and others are missing is that we are not talking about the total taxes that the rich and poor pay, but the tax rate.
    From the Times of Londen:

    Mr Buffett said that he was taxed at 17.7 per cent on the $46 million he made last year, without trying to avoid paying higher taxes, while his secretary, who earned $60,000, was taxed at 30 per cent.

    I'll grant that Mr. Buffet paid far more in taxes than his secretary, but can you tell me why it is fair, and necessary, that he pay half the tax rate?

  • Doug on September 19, 2011 9:51 PM:

    Thank you, Chuck!

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