Recently, President Barack Obama and the Democratic Party have been pushing the “Buffett Rule,” a tax law named after Warren Buffett that would require households making over $1 million annually to pay at least 30 percent in federal income taxes. The bill was brought to the Senate, and though it received a majority of support, it was blocked by a Republican Party filibuster.
The republican argument against the “Buffett Rule” is one we have heard before: raising taxes on the rich will hurt job growth and prevent the economy from expanding. This argument is of course based entirely on conjecture, without statistical support. In fact, according to numbers from the Bureau of Economic Analysis and Tax Policy Center, the opposite is true.
When the top marginal tax rate was between 28 and 31 percent, the annual growth of the economy was an average of 2.6 percent. When the top marginal tax rate was between 39 and 50 percent, however, the annual growth of the economy was at 3.7 percent. In fact, if we look farther back in history, the top marginal tax rate stood at one point between 75 and 80 percent, with the annual growth of the economy at 4.6 percent.
The unemployment correlation that the republicans argue does not hold water either. When former President Bill Clinton raised taxes in 1993, unemployment dropped from 6.9 percent to 6.1 percent and continued to fall for the next seven years. When former President George W. Bush cut taxes in 2001, the unemployment rate rose from 4.7 percent to 5.8 percent.
It is interesting that the republicans continue to state that their focus is on reducing the national debt, yet they oppose attempts to do just that. According to the Joint Committee on Taxation, the legislation proposed by democrats in the Senate would raise $47 billion over 10 years, while the proposed republican tax bill would cost the U.S. Treasury $46 billion, with half the benefits of the bill going to households making over $1 million annually. It does not take an economics degree to realize that to cut a deficit of any type, you must have more money coming in.
Logically, it makes no sense to oppose a tax increase on the rich. In this country, multimillionaires are paying a lower tax rate than some in the middle and lower class. Warren Buffett himself stated publicly that his tax rates are lower than his secretary’s. Mitt Romney, the apparent Republican Party nominee, paid only 13.9 percent in taxes on an annual income of $21.7 million.
Underneath all the rhetoric behind the Republican Party’s refusal to back the “Buffett Rule,” the truth is simple. They are not following a logical argument or the facts. They are not following their constituents, of whom a whopping 72 percent support the bill. They are following the money. Donations from multimillionaires and big corporations overwhelmingly favor the republicans, and they will protect that money trail at any cost.
Now I understand that many of those in the upper class do work hard for their money. But, if they have more, they should give a little more back to the society that made it possible for them to have more.
Our national debt will not go away by itself and continuing to cut government programs in education and health care will only set our nation further behind others. We need more income, and it should come from those who have more to give. Republicans in the Senate and the House need to stop standing in the way of progress for our country.