When Pigs Fly: Liberals Need To Practice What They Preach

21 Apr

I’m still trying to find some sort of research on voluntary tax payments from self-identified democrats (I expect if I can gather such data, the number will be fantastically unimpressive), but until then, let’s talk about how our Nation’s Leading Democrat files his taxes:

Though tax increases alone cannot put the country’s fiscal house in order, the president should set a better example on his own tax returns.

That $245,000 the Obamas gave to charity, for example — deducting it on their Schedule A reduced their federal tax bill by roughly $85,000, and cut their Illinois state tax bill too. But you’re not required to deduct charitable giving, or to claim any tax favor. Deductions and tax credits are options. If you think the government deserves more of your income, don’t claim them.

Obama said last year that itemized deductions for the wealthy should be phased out — then on his own tax return, claimed a huge itemized deduction. Until those who advocate higher taxes for the well-off practice what they preach, the national debt situation may only get worse.

I’ll take it one step further.  Every single person advocating higher tax rates (especially for “the rich”) should release how much they paid in excess of their legally-required minimum tax.  You think Nancy Pelosi & Co. paid a single penny more in taxes than they were required to do so.

Challenge.

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19 Responses to “When Pigs Fly: Liberals Need To Practice What They Preach”

  1. wsm April 21, 2011 at 12:04 pm #

    Your “challenge” is preposterous.

    I am neither a liberal nor an Obama supporter. But an exhortation that people individually and voluntarily pay more in taxes than is legally required is, well, ridiculous. It seems to conflate the problem with the symptoms.

    The PROBLEM is the horrifically convoluted and loophole-laden tax code. The SYMPTOM is taxpayers’ realizing the benefits afforded them under this flawed system.

    • The Analyst April 21, 2011 at 2:36 pm #

      The problem is we spend more than we take in. Some people claim the solution is for “the rich” to pay more, but where I take issue is that many of these people fit into the very group they claim should bear more of the tax burden, yet very, very few (dare I say, if any) of them put their money where their mouth is.

      • wsm April 21, 2011 at 3:23 pm #

        “The problem is we spend more than we take in.” I agree that the real problem is on the expenditure side of the ledger, but I thought this post was concerning the income side.

        If we want to talk about the expenditure side, there are entire departments of the federal gov’t that I would eliminate tomorrow.

  2. HRJ April 21, 2011 at 2:31 pm #

    I’ll second that your “challenge” doesn’t make any sense, for another reason.

    It could very well be the case that if *everyone* paid higher taxes (i.e., because of a legal mandate), certain solutions would become available to our current problems that would not be available otherwise. Put another way, it’s possible (indeed, likely) that there are positive, non-linear dynamics connecting tax revenues and fiscal policy, so that it is entirely consistent to say, “I will gladly pay more taxes, but only if everyone else does, too.”

    C’mon!

  3. br_add April 21, 2011 at 5:15 pm #

    I agree with the above commenters that this challenge is preposterous.

    this logic extends to saying that a lawmaker should not advocate for longer/tougher sentences for felons because the lawmakers himself isn’t a felon. do you really think the lawmaker has to voluntarily go to prison, be put on probation, or whatever in order to have legitimacy?

    • The Analyst April 21, 2011 at 5:20 pm #

      That is a massive non-sequitur. Try again.

      • br_add April 21, 2011 at 5:38 pm #

        i think its analogous.

        so, what if obama advocated a system where only people with $10 million were taxed more – would you still have an objection on the grounds obama lack legitimacy (even though obama does not make $10 million a year)?

          • br_add April 21, 2011 at 10:18 pm #

            Interesting link… in the comments of the Landsburg article I noticed this:
            http://www.slate.com/id/2210336/
            which says IRS cannot accept more money than its owed – although I suppose Obama could choose not to itemize and then the IRS would actually be ‘owed’ the money… but then you get into questions about whether he should go higher still and not claim Sascha and Malia as dependents so his taxes are higher, or should he claim higher income, etc.

            Anyway, its the philosophical question is more interesting than the practical question. I think DVL asks the kind of questions I was trying to get at, regarding troops and education reform. Its hard for you to say that Obama (re the troops) or the republican (re education) has legitimacy and then distinguish that from Obama on taxes.

            I think fundamentally we as Americans expect to each have the same obligations to government and that government treat us the same (in some ideal sense, if not in practice). The kind of thing you’re proposing is a departure from that principle.

    • The Analyst April 21, 2011 at 11:03 pm #

      The donations do not go through the IRS, but to the Treasury. See the last point in this FAQ: http://www.treasurydirect.gov/govt/resources/faq/faq_publicdebt.htm#DebtFinance

      I’m not going to parrot the anti-tax line that raising tax rates on the highest achievers (by income, a highly imperfect metric, for another time) disincentivizes them to work harder (produce more, whatever). However, on the other end of the spectrum, if we piss off the people who already pay a ridiculous amount of taxes (in absolute and relative terms) they have the means, and raising tax rates on them may very-well provide the impetus for them to officially relocate, to the detriment of everyone else who doesn’t, at has to make-up the short-fall.

      Even during times like these, I’d far rather see sustainable cuts in wasteful, inefficient, and otherwise dumb government spending (how many wars/”wars” are we going to fight at once?!?!) before we raise taxes on a single person.

      If wealthy people (putting aside the definition thereof) want they and their ilk to pay more of “their fair share” they can do so already without the need for us to change the tax code. How many of them do you think do so?

      Likely, few, if any. (can’t find link, but for some reason I think there was only about $25 million in voluntary payments last year. I’ll try to find the actual # and drop it here if I find it).

      • br_add April 22, 2011 at 1:10 am #

        High-income people do not pay a ridiculous amount of taxes by a historical or international basis. So no, not on relative terms. Yes, they pay more in absolute terms, but I believe they also make more in absolute terms so that fact is kinda irrelevant?

        I already provided a link that shows high-income people don’t move away. We have it pretty good in the US in terms of tax burdens. Just ask the rest of the civilized world. And even when their tax burdens get worse, people still stay in New Jersey.

        I would like to see the defense budget scaled back as well. Unfortunately, that will not be enough to solve our budget problems in and of itself. It also seems like there are more people who would like to keep the DoD at current levels, so that’s democracy for ya.

        You’re saying that people who believe we should pay more taxes should make donations to the Treasury. But that is not paying more taxes, it is making a gift, so it is irrelevant and beside the point to those who are advocating higher taxes.

  4. DVL April 21, 2011 at 10:06 pm #

    That claim is ridiculous. Obama doesn’t want to give up any more of his money–no one does. He’ll agree if you ask him.

    What he wants to do is fix a problem. 85k out of his pocket doesn’t fix a problem. Decreasing spending does. Increasing taxes (gasp!) also does.

    Is it hypocritical for Obama to send troops to Afghanistan without going himself? Is it wrong for a Republican to push for education reform if he sends his kids to private school?

    Besides the fact that your argument doesn’t really make sense, it seems a little ridiculous to make cuts that will prevent someone from being able to pay for healthcare (medicare) or force them to drop out of college (pell grants) before you ask people making 7 figures to give up another 3% of their income. Tell me why that makes sense.

    • The Analyst April 21, 2011 at 10:18 pm #

      As I responded to an above comment, your analogies are non-sequiturs. I get what you’re trying to do but it does not follow.

      It would be hypocritical for Obama (and everyone in Congress) to send troops to war without allowing their sons & daughters to go. It would similarly be hypocritical for politicians to argue that public education is fine for everyone and then to send their kids to private school.

      Insane government intervention in student loan and mortgage markets has created severe and possibly irreparable damage, artificially increasing the demand for post-secondary education and housing. If you don’t understand that, do a little cursory reading, as there is no shortage of literature available.

      Many people far smarter and with many more degrees than I have beaten these arguments to death, about as conclusively as you can get with Economists. See the link to Greg Mankiw’s post http://gregmankiw.blogspot.com/2011/04/people-talking-past-each-other.html?utm_source=twitterfeed&utm_medium=twitter

      If you disagree with him, well, not sure what to say. While the # of letters after one’s name don’t necessarily mean the argument they present is correct, the only people I’ve read who disagree with him are uber-liberal types like Robert Reich.

      • br_add April 21, 2011 at 10:28 pm #

        yes, they’ve beaten the issue to death and we’re on the left side of the laffer curve:
        http://voices.washingtonpost.com/ezra-klein/2010/08/where_does_the_laffer_curve_be.html

        and punitive taxes on the rich don’t make them move away either:
        http://blogs.wsj.com/metropolis/2011/04/20/did-new-jerseys-millionaire-tax-drive-away-wealthy/

        besides, this is a philosophical (or maybe political science?) point about who has legitimacy, not an issue mankiw or other economists are better equipped to deal with (or have beaten to death for that matter).

      • DVL April 21, 2011 at 11:36 pm #

        Oh, that was government intervention that sold all those crappy mortgages? And sold/bought all those crappy derivatives? Come on…

        And explain to me how having fewer Americans with college educations benefits the country from a policy perspective.

        I get it, you don’t want to give poor people any more of your hard earned money, but at some point someone
        has to sacrifice to solve this budget thing.

        • The Analyst April 21, 2011 at 11:42 pm #

          I like how you’ve very conveniently avoided the reasonable response I made to your previous allegation. In addition, you’ve also shown that you’re completely biased and ignorant about the housing and education markets, financial and human capital. Furthermore, for some reason, despite my bio being quite literally a click away, assume that I’m some sort of rich, high-earning person, when in fact, I’m in graduate school, and thus have effectively zero real income. IN FACT: I’m taking out thousands and thousands of dollars/year in almost exclusively non-government loans to do so (despite scholarship).

          Do yourself a favor and drop the attitude/bias and do some reading before you run your mouth, my friend.

          • DVL April 22, 2011 at 9:04 am #

            First, let me say that I do read your blog and I like it a lot. But, I really had to jump in on this one on two points (that stem from your response above):

            -Conservatives (or whatever the opposite of liberal is in your world) should really stop complaining about how biased the world is toward them and how anyone who doesn’t agree does so because they haven’t read enough (or the right thing) about the issue. It’s just intellectually lazy.

            -And, back to the original post, the argument is that because Obama won’t pay more in tax voluntarily, no one should be required to pay any more in taxes than they do now. Fine, condemn him for being hypocritical (I happen to disagree, but fine), but that isn’t a policy position. Stick to policy, that’s what I like about your stuff.

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